The CEO conversation right now has two camps fighting over the same word: hardcore. On one side are the executives who’ve decided the answer to a complicated moment is to crank up intensity and push everyone harder. On the other side are those in line with Sheryl Sandberg’s reframe. Sandberg argues that “hardcore” can mean kind, that you can be demanding and humane in the same breath. Both camps are making real points, and yet both miss the bigger story.
The bigger story isn’t just about CEOs who are failing or succeeding. It’s about the much larger group of leaders inside your own company, quietly producing the wrong outcomes while nobody pays attention because those leaders look fine on paper.
In a Harris Poll study we conducted with more than 2,200 employed Americans, we asked employees to rate the direct-line leaders they work for. Only 30 percent of those leaders came back as exceptional. Sixteen percent were rated outdated, still operating from a playbook that no longer works. The largest group, 54 percent, came back as “good.” In other words, they’re solid, competent leaders who generally hit their numbers and rarely show up in HR’s inbox. You might call them the leaders nobody worries about. And yet, that’s exactly why you should be worried about them—because employees need a lot more from leadership to be successful today.
Loud failure, quiet failure
When top leadership goes loudly wrong, you see it. There’s a name attached. Boards know what to do. CEOs know what to do. The dysfunction has a face and a fix.
When leadership goes quietly wrong, you don’t see anything for a while. Engagement scores stay middling. Voluntary turnover ticks up, but CEOs blame the market. Initiatives launch with energy and quietly die three months later, and nobody can pinpoint when. A few high-potentials leave. The leaders running those teams still hit—or at least get close to—their quarterly numbers. The dashboards say everything’s fine.
Our research shows the dashboards are wrong.
When we asked employees what they actually feel under so-called “good” leadership, the picture changed. Very few of these employees say what’s important to them is valued and that they feel heard. Just 14 percent say they’re reaching their potential—the lowest score on that question. On the flip side, employees say exceptional leaders make them feel heard, supported and motivated. And yet, so few leaders meet that exceptional definition. Nearly three out of four leaders are falling short on what the moment requires.
The math that should keep CEOs up at night
I keep three equations on a sticky note on my desk.
Uncertainty × Outdated Leadership = Disengagement
Uncertainty × Good Leadership = Anxiety, Complacency, Drift
Uncertainty × Exceptional Leadership = Confidence, Safety, Trust
The first is obvious. The third is aspirational. It’s the middle equation that does the damage, because most organizations are living there right now and don’t know it.
Under stable conditions, good leadership is enough. People do their jobs, save the rest of their energy for life outside work and the organization functions. We are not in stable conditions. Economic volatility, AI disruption, geopolitical pressure and restructuring are all coming at our employees at once. Under those conditions, good leadership doesn’t produce good outcomes. It produces a slow erosion. Trust drains and discretionary effort migrates somewhere else. The people you most want to keep tend to quietly check out before they leave.
Where the middle equation hits your P&L
A seminal Gallup study often cited by business researchers found a direct connection between high employee satisfaction with leadership and key business outcomes, including customer satisfaction, productivity, profit, lower employee turnover and reduced accidents. The study’s authors found management practices designed to improve employee satisfaction “can increase business unit outcomes, including profit.”
Subsequent research by Gallup, including its most recent meta-analysis, shows that the most engaged business units deliver 23 percent higher profitability than the least engaged, alongside higher productivity and lower turnover.
The same research finds 70 percent of the variance in team engagement traces back to manager quality. These findings point to your leadership bench being one of the largest controllable variables for your P&L.
Specific leaders prove the point, Doug Conant took the Campbell’s CEO job in 2001 with engagement scores Gallup called the worst they’d seen. He led with gratitude and over the next decade Campbell’s outperformed the S&P 500 by nearly 50 percent.
SHRM puts the cost of replacing a senior or specialized employee at up to 200 percent of annual salary, and when good leaders fail, the people who leave first are the ones with the most options.
Why the gap between good and exceptional exists
Here’s the part that surprised me when our research came back. The gap between good and exceptional leaders isn’t where most CEOs assume it is.
When we analyzed the top 10 attributes that distinguish exceptional from good, nine were what might be defined as “heart” skills. This includes gratitude, listening, empathy, the ability to build cultures where people feel included and trust. Only one was considered a “head” skill, and even that one wasn’t strategy or analytics. It was transparency.
Google ran a parallel study on what defines great leadership more than a decade ago, with a different methodology. The study, called Project Oxygen, found a similar 9-to-1 ratio. While it was a different decade with a different research design, they got the same answer. Most companies still aren’t building leaders with these essential heart skills.
This is where the “hardcore” debate gets it half right and half wrong. The “we need to demand more” instinct is correct. The moment requires more from leadership than it ever has. And yet the “more” that matters now is presence, gratitude and the willingness to listen before broadcasting. These are all skills on the human side of leading. The explosion of AI is making these skills all the more valuable every quarter.
Three moves CEOs can make now to support and coach their leadership teams
Reframe leadership investment as risk mitigation, not development. The minute leadership development gets categorized as growth or training, it becomes optional. It floats in the budget and gets deferred when the quarter gets tight, which is exactly when you cannot afford to defer it. The capabilities that separate good leaders from exceptional ones—such as gratitude, listening, empathizing, communicating with context, connecting strategy to growth—determine whether your transformation lands or stalls. Calling them “soft skills” underestimates them, which is why you need to budget for them like you would for cybersecurity.
Demand different indicators from your top team. Engagement scores and attrition numbers are lagging, and CEOs can’t afford to ignore them. Ask your direct reports for leading indicators every quarter. Identify decisions that are being revisited multiple times and initiatives that launch with energy and simply die. You also need to track high-potentials and determine which leaders help them feel known as a person, not just measured as a contributor. It’s critical for CEOs to have a handle on which of your leaders are costing you the people you most need to keep.
Model the heart work yourself. You cannot ask your leadership team to slow down enough to express specific gratitude, listen for what isn’t being said or be more transparent with their teams if you aren’t doing those things in your own meetings with them. The leader makes the weather, and the CEO makes it at scale. If your team experiences you as transactional or performative—calm one day, stressed and commanding the next—they will replicate that downstream and call it leadership.
Stop confusing output with leadership
The 54 percent middle “good leaders” didn’t appear by accident. Some of those leaders got their teams because they hit individual contributor numbers. Others have run teams for years without ever being measured on people leadership specifically. Both paths produce the same result.
Reset the bar. Whether you’re evaluating a candidate for promotion or a leader already in the seat, look for evidence they’re closing the three gaps that define exceptional leadership. Do their people feel that what matters to them is valued? Do their people feel heard? Do their people feel they’re reaching their full potential? If you can’t get specific answers and examples, the leader isn’t where they need to be.
The 54 percent middle isn’t one group
You can’t treat the 54 percent as a single block. After watching this play out across hundreds of leadership teams over the past 25 years, my read is that the middle breaks roughly three ways.
The important piece is that about half of your “good” leaders are coachable to exceptional with real investment and willingness on their part. The skills can be taught, and we now have the data to know which ones to teach.
Another segment of the leadership group will stay where they are, performing as solid managers without ever stretching further. That’s a fine outcome if you place them in roles where the team and the moment don’t demand more.
The remainder is the group most CEOs avoid talking about. They aren’t going to make the jump, either because they don’t believe in the work or because they’ve plateaued. Some belong in roles where heart skills matter less. Some need to be exited. The longer you carry them in critical people-leadership seats, the more of your future leaders they take down with them, because the high-potentials reporting to them leave first.
All of this points to some important new directives for CEOs to succeed today. The CEOs who lead well through this moment are willing to make investments in leadership development and track progress against newly defined outcomes. How do employees rate their own leaders on trust and genuine support, as well as traditional business outcomes like profitability and growth? After both factors are taken into account, CEOs can determine which of their leaders are actually in the right seat.
The cost of not bringing heart skills to the leadership table
Of course CEOs need hard skills and the ability to manage to the bottom line. The problem is that too many chief executives don’t know how to bring both head and heart to their leadership. Further, they’re not coaching their own teams to become truly exceptional in both sets of skills. This is the work of modern leadership. Employees need a lot more than “good” from leaders to take business to the next level in today’s complex world. Our teams demand an exceptional bench of leaders. As CEOs, it’s time you do too.
