Inside Healthy Organizations

The Performance Metric Most Leaders Ignore

Michael Sullivan · February 5, 2026

For CEOs and executive teams missing their numbers: why how your leadership team works together belongs on your performance dashboard, how to measure it, and what changes when you do.

How well a leadership team works together is the performance metric I see most teams measure least and invest in least, even though it explains a surprising amount of their results.

Why it belongs on your dashboard

McKinsey found that companies that worked on it saw earnings rise about 18 percent, against 7 percent for the S&P 500 over the same period. The two moved together; McKinsey does not claim one caused the other.

Patrick Lencioni puts it plainly: “The single greatest advantage any company can achieve is organizational health.” It is hard to copy and usually ignored. Strategy, AI, and innovation matter, but without trust, clarity, and accountability, even strong plans stall in politics, confusion, and rework.

What I see on leadership teams

When executive teams bring me in, it is rarely because they woke up wanting to work on how they work together. They call when:

• The team is misaligned on strategy or priorities, and decisions get revisited after the meeting.
• Meetings are draining, political, or inconclusive, and everyone is busy, but the business still feels stuck.
• There is a gap between the plan and the numbers, and no one agrees on why.
• Attrition is rising in critical roles, or top performers are quietly disengaging.
• AI or another shift is hitting the business faster than the team can respond.

Underneath each of those is the same short list: trust, clarity, accountability, or the ability to have real conflict without damaging relationships.

You can measure it

Leading indicators: how fast decisions get made, how well meetings work, collaboration across functions, and how aligned the leaders are. Lagging indicators: time to market, retention, customer satisfaction, operating margin, and revenue per employee.

When trust improves, decisions get made in the meeting instead of in side conversations, and meetings get shorter. When clarity increases, priorities stop changing every quarter. When accountability rises, leaders hold one another to behavior and results, and performance conversations get cleaner and faster.

I have not always done this well

Early on with a large healthcare client, I held back a hard truth about how misaligned the senior team really was, because I did not want to look difficult or risk the relationship. Six months later, the same issues were back on the table, only more expensive and more political. That pushed me toward what Lencioni calls Getting Naked: tell the truth sooner, even when it feels risky.

Recently, I worked with a mid-size tech leadership team that was missing its revenue targets while doing all the right things on paper. Over 90 days, we rebuilt trust on the executive team, set three priorities that were not up for debate, and overhauled their leadership meetings. Decisions on key issues went from weeks to days, friction between functions eased, and the team ended a multi-quarter slide by hitting its next two targets in a row.

With AI, this is what is left to compete on

Strategy decks leak, technology can be copied, and AI gives everyone the same analysis. What remains is how fast a leadership team can decide, adapt, and execute together. It is one of the most underused performance levers leaders have.

Send me a note with the one place where ambiguity is costing your team the most right now.

Talk about your team

Also on LinkedIn: www.linkedin.com/pulse/why-organizational-health-missing-performance-metric-most-sullivan-0540e

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