Innovating Leadership:
Co-Creating Our Future
Hosted by Maureen Metcalf
Conversations with global thought leaders on leadership, culture, and innovation—designed for executives navigating complexity and building resilient organizations.
Design a Culture That Boosts Performance
Episode Description
Organizational change succeeds when leaders understand and address the behavioral, psychological, and systemic factors that influence how people respond to transformation. Drawing on behavioral science and evidence-based management, the discussion examines why rational plans often fail in execution and how habits, cognitive biases, and change fatigue can undermine strategic initiatives. Enduring organizational strength is built through adaptability, learning, and the capacity to evolve under pressure.
Key Takeaways
- Effective transformation requires addressing human behavior, not just processes and strategy.
- Cognitive biases can distort decision-making and prolong investments in ineffective initiatives.
- Change fatigue reduces organizational capacity and weakens the impact of future transformation efforts.
- Adaptability becomes a competitive advantage when learning and adjustment are embedded into operations.
- Evidence-based leadership improves the likelihood that change initiatives produce sustainable results.
Why This Episode Matters
It highlights why many well-designed change initiatives fall short and how leaders can build organizations that become stronger, rather than weaker, through disruption.
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Episode Content:
Your Organization Doesn’t Have an Engagement Problem. It Has an Agreement Problem.
Before launching another engagement initiative, examine what your systems teach people is safe, valued, and expected. These are the social agreements of your workplace.
Most organizations have plenty of intelligence on board. What they lack are systems that permit people to use it.
Leaders say they want employees to think critically, challenge assumptions, share knowledge, and act with initiative. Yet their organizations quietly reward something else:
- Stay in your lane.
- Wait for approval.
- Protect your expertise.
- Don’t make others (especially your bosses) uncomfortable.
As those unwritten rules and invisible agreements pinch on each member of a team, we call it disengagement. But all too often, it’s not really an employee-engagement problem. It’s an agreement problem.
Our Systems Ignore What We Say: They Teach Something Else Instead
Every organization runs on agreements. Some are explicit: work hours, reporting lines, decision rights, performance goals, and job descriptions…basically, anything formally codified. Others are largely invisible:
- Who is allowed to challenge an idea?
- What requires permission?
- Is disagreement safe or career limiting?
- Does sharing knowledge increase your value or reduce it?
- Are people expected to contribute judgment or simply execute instructions?
- Do you get in trouble contributing to another department’s “silo”?
- Does shunning hit people with contradictory observations or ideas? (Yes, this really happens.)
These agreements shape behavior more powerfully than a town hall, a values statement, or an invitation to “speak up.” If the formal message is “bring your best self to work” but the lived message is “don’t take risks,” employees will believe the lived message.
That’s a perfectly rational response to the system, not a motivation failure. It actually encourages disengagement.
Trust: Leadership’s Most Suspicious Desire
We learned how agreements affect leadership systems in our podcast with Jim Ritchie-Dunham, Annabel Membrillo, and Ana Claudia Goncalves. They provided a case study from a major international bank.
Leaders invited employees to share knowledge, propose ideas, and contribute capabilities beyond the boundaries of their formal roles. The invitation was genuine; the bank truly wanted to transform the workplace, procedures, and culture.
Yet, for six months, almost nothing happened.
The easy conclusion: People were resistant, apathetic, or unwilling to change. In reality, they were waiting for evidence. Years of experience taught them what the organization really expected (i.e., the unwritten agreements). One invitation could not instantly erase that accumulated distrust.
Eventually, people began to test the opening. Ideas emerged, including a university-linked diploma program and events connecting employees with technologies and providers. Knowledge began to move. Expertise broadened beyond isolated pockets, strengthening backup capacity, flexibility, and succession.
The six-month silence showed how long employees needed to decide whether the new agreement was credible and whether they could trust leadership again.
Trust often arrives after the invitation, not with it.
The Lesson Sitting Next to You
The bank found something even more important: A group of roughly 50 people already produced exceptional results while also maintaining strong relationships, communication, and care for people. For years, this particular team had been quietly, even invisibly, doing what the bank leaders wanted to see across the entire organization.
The organization did not need to import some trendy new theory of high performance. It already had a working example to learn from within its own ranks.
The difference was not simply talent. This group operated under different agreements: about contribution, coordination, knowledge, and responsibility.
That creates a powerful leadership insight: The future of your organization may already be happening on a small scale, hidden in another department.
Too often, leaders search outside the company for a model while overlooking the team down the hall that has already solved part of the problem. But remember those hidden agreements. The task isn’t copying that team’s visible practices mechanically. It’s uncovering the underlying conditions that make those practices work. It’s discovering what those people feel free to say, decide, question, and share.
And why other teams cannot.
Hidden Agreements: The Operational Risk
When knowledge remains concentrated in one person or function, you have a single point of failure. That cost is both cultural and in your operating system:
- Decisions slow down because too few people can make them.
- Problems wait for the designated expert.
- Rework grows because relevant knowledge arrives too late.
- Succession risk increases.
- Adaptability declines.
- Innovation stalls between a good idea and permission to act.
There’s an even bigger, more chronic result: The organization employs highly capable people, yet operates below its collective intelligence.
That gap is often treated as a soft issue. That’s deceptive. The results are quite hard: wasted capacity and concentrated risk.
Start the Change with One Agreement
Redesigning the entire culture at once is difficult, if not impossible. Too many hidden agreements lurk beneath the social surface.
Instead, begin by identifying one agreement that prevents people from using their best judgment. Ask:
- What contribution do we say we want from people?
- What do our approval processes, meetings, incentives, and promotion decisions actually reward?
- Do we have a team already operating under more productive agreements?
- What evidence would employees need before trusting a new invitation?
- What is one agreement we can change now, and what operational outcome should improve if we do?
Research consistently shows employee engagement at alarmingly low levels worldwide. The solution isn’t weekly pizza parties or some other morale campaign. It emerges from uncovering the agreements people experience every day.
If you want more initiative, stop asking how to motivate people. Start asking what your system has taught them is safe, valuable, and expected. Then change those expectations.
Thank you for reading our newsletter, where we bring you thought leaders and innovative ideas on leadership topics each week.
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Resources:
Learn more about hidden agreements and vibrancy at Jim’s institute’s website, https://isclarity.org/.
The free agreements survey mentioned in this episode is online at https://isclarity.org/pages/surveys.
Our host Maureen Metcalf posts a newsletter every week on LinkedIn. You can subscribe here.
Maureen’s latest book is Innovative Leadership & Followership in the Age of AI. You’ll find details about it at https://bit.ly/LeaderInAI, or check out the Kindle version at https://amzn.to/44buVz8. The audiobook version is now available at https://amzn.to/4dTCleZ.
Her other 10 books are available on Amazon here.
Other episodes with Jim Ritchie-Dunham you’ll enjoy:
- The Science Behind Our Yes!
- The Power of Passion & Perseverance: Four Levels of Grit
- Back to the Future…of Work with Jim Ritchie-Dunham, Suzie Lewis, and David Dinwoodie
Guest(s):
Guest(s) Bio:
Jim Ritchie-Dunham is president of the Institute for Strategic Clarity and Clinical Associate Professor of Strategy at the University of Texas at Austin’s McCombs School of Business. He is also a department associate with the Harvard T.H. Chan School of Public Health’s Center for Work, Health, and Well-being. His research examines the agreements that shape human interaction, organizational performance, and ecosystem-wide flourishing. He is a co-editor of Leadership for Flourishing, published by Oxford University Press in 2025, and the author of Ecosynomics: The Science of Abundance and co-author of Managing from Clarity.
Annabel Membrillo is a systems-change practitioner, educator, and collaborative strategist with approximately 35 years of experience supporting systemic transformation and collaborative strategy across organizations. She is associated with Universidad del Medio Ambiente in Mexico, where she is Director of the Faculty of Business. Her work includes organizational design, systemic strategy, sustainability, regenerative leadership, project evaluation, and developing communities capable of meaningful social and environmental change.
Ana Cláudia Gonçalves is a thinking partner, mentor, executive coach, strategist, systems adviser, researcher, and social entrepreneur. Drawing on more than three decades of experience in multinational organizations, she works with executives and organizations navigating strategy, transformation, human development, and systemic change. Her current work focuses on helping leaders connect organizational performance with regenerative capacity and human flourishing. She contributed the chapter “Leading Shifts in Regenerative Capacity for Flourishing” to the 2025 Oxford University Press volume Leadership for Flourishing.
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Transcript
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Maureen: [00:00:00] Today we’ll be talking to three people; the first person we’re gonna be talking to is Jim Ritchie Dunham. He’s the president of the Institute for Strategic Clarity. Second is Ana Claudia Goncalves. She’s served in international positions in ten countries. And our third guest is Anabel Membrillo, who works as a collaborative partner with a wide variety of organizations exploring how to design organizations and change processes.
So Ana Claudia, who has been a CEO, will be talking about how she’s used the Vibrancy framework within her organization and the value it brought. What results did you get?
Ana Claudia: Hello, Maureen. As a CEO you know that what we are looking for is the concrete and tangible results. When I saw Vibrancy for the first time, I said, “Oh my God, I’m not the only one who thinks that is really the way of better results.”
And, I understand that [00:01:00] there is a survey that can give me the measurement, the tangible measurement of the evolution of a transformational journey. For me, it was really interesting to have concrete measures of where we are as a company and what kind of evolution we can propose based on that to reach the new stage in the company, and measure that transformational process.
Never ever before I was able to prove the results of a transformational process, and that was the first time that I found concrete tools to really measure the impact of a transformation.
Maureen: What people may be more familiar with is some of the Gallup engagement surveys.
I’ve heard people say, “Well, you know, it’s nice that people are happy, but what I really need to do is deliver returns to our shareholders, and if it doesn’t do that, I don’t know that I get to be [00:02:00] nice. I have to deliver returns.” So what did you do that both increased vibrancy and drove bottom line results?
Ana Claudia: My thinking about what you said is a bit different because I have life case studies where we have better results than we expected by increasing the vibrancy.
This term vibrancy may sound unfamiliar in the organizational and corporate environment, but this vibrancy is increasing the capacity of each of the members of the organization to deliver their best. So if I’m working with more of the potential of each of the persons in the organization, I will achieve a much better result.
Maureen: Having studied with Jim also, what I’ve learned is focus on underlying agreements.
So I [00:03:00] deliver more vibrancy by changing the agreements we have within the organization. So why don’t we shift to Annabel and tell us how you moved to identify the agreements that were impacting vibrancy and results?
Annabel: In the beginning, we only apply the survey to the CEOs and the directors and the board. But the second year, we apply the survey to the whole company, and that gave us a really big surprise. Inside the company, we already have a living example of extraordinary result. So for that specific group, around 50 people, they were having a really nice set of agreements that allows them to be extraordinary in the way they were, like, having the outcomes that the bank was asking for.
But they also had that set of agreements that allows them to be taking care of people and how people [00:04:00] was behaving and communicating and, and maintaining all those set of different agreements that makes you design the change management process.
So that, that was one of the biggest thing for me, that big surprise that we find out that we already have a really big group with a different set of agreements. So that was the second year, and the last year we also applied the whole survey to the group to be looking at how those agreements were changing during time and to be like asking ourself the underlying assumptions and how to redesign the next step for the group.
Maureen: So what I hear is a few different approaches. We would wanna know what is the final outcome. I heard a lot more measurement than I have experienced on some engagements, especially engagements that deal with kind of the, quote, “soft stuff,” and that the measurement also included measurement [00:05:00] for profitability and changes.
And I’m assuming that Ana Claudia, you had to report that on a regular basis.
Ana Claudia: I can share some detailed information. For instance, with the knowledge sharing we improved from one person have one subject matter expert to four years after, they have four subject matter where they are experts, and that have a huge impact in the bottom line because we can have more work, we can solve more problems with the same team.
We can do a much better program of backup and, definitely a capacity of delivering much more flexible.
Maureen: Succession planning, risk management, having more than one person manages risk in a way that is required to run a successful organization.
Jim, if you would talk to us a little bit [00:06:00] about what is vibrancy. What is it and why does it matter?
This is your life’s work, so this must be really important stuff.
Jim: Great to be with you, Maureen. The question that we’re asking is, when we find groups individuals that are doing what we seem to think as extraordinary results and experiences, what are they doing? And this is a question that a lot of us have been asking for a long time.
We pair that up with the surveys, like the Gallup study that shows that most people are unengaged or actively disengaged in their communities or organizations globally. And, as we started to find groups that were doing what we thought was extraordinary, what is it that differentiates these groups?
So to do that, we created a survey to say, “What is it that people are doing when they say, ‘I’m really energized by when I’m in this community. I love being here.’ And we get just these amazing results.” I said, “Cool. Well, how long you been doing that?” “Well, about 20 years.” What is it that people are doing that are getting such great results?
So we desi-designed this survey [00:07:00] to see if we could differentiate between people’s experiences of groups that were really awful to really great, and what is it that differentiated them. Um, this is a survey that now has over twenty-seven hundred responses, ninety-four countries, big organizations to very small, communities, government, business, civil society networks.
So a wide variety. And what we’re finding is this thing, we’ll call a good vibe, a vibrancy. It’s a term that at first sounds very fluffy, new agey, but it’s a term that comes out of people describing the difference between when I feel really energized in a group and when I don’t. ” I have to medicate myself after being with you people” is a low vibrancy experience.
We saw a recent medal that people were handing out to each other, “I survived another meeting that should have been an email.” “Highly disengaged and I really don’t wanna be here. I don’t even know why I’m in this meeting. I’m only here because somebody put it on my calendar.”
To people saying, “I’m really [00:08:00] stepping into my potential and learning every day, and I love being here, and I always bring my best.” So what we’re finding is that people prefer to be highly engaged and to be able to make their unique contributions and bring the best ideas that they can and getting to play in that kind of way. And then it’s not a surprise when we do our research and the statistical analysis to say that places where people, as Ana Claudia described earlier, that are highly energized, highly engaged, bringing the best that they can, learning all day long deliver much better results.
So even just from a basic leadership perspective, I’m paying for these folks to be here, and I’m not getting anything out of them, or they’re actively disengaged and terrorizing my company. Or they’re here, and they’re highly engaged in bringing the best that they can because they deeply care about what we’re doing and really supporting each other in them.
So what we found in all of that work is the difference is in these agreements that we have, and starting to see why is it that we’re in this group that really is quite awful, but over here we’re in a group that’s pretty good or [00:09:00] great?
And to say, “Well, it’s ’cause they have different agreements.” So while you can get very sophisticated in the consultancy and the strategy of what the agreements are, what we’re finding is most of the time it’s just a very basic question of are you liking the experience you’re having? And be like, “No.”
Ask other people in your group, are they liking it? And they’ll often say no. Say, “Well, could we choose different agreements?” Say, “Oh, you know, we actually could choose different agreements ’cause we make them up.” And this is where we come to, as you said earlier, vibrancy is a choice. And if we choose to live a different way, then let’s ask each other, “Well, what would we like our agreements to be, and do we have experiences of what they could look like?”
And so the survey is an instrument that we have that’s available online for free at the institute to support you in seeing, well, where are we in our agreements, and what agreements could we choose to have a different experience and then achieve these kinds of outcomes that Annabelle and Ana Claudia were talking about?
Maureen: So we’ve been talking a lot about agreements. Can you give us a couple of concrete [00:10:00] examples? What do I agree to when I go to work other than I show up and you pay me?
Jim: Excellent. One is does our agreement say that I am a cog in the wheel, a cog in the machine of this place, and I’m infinitely replaceable by anybody?
And so if that’s true, then our agreement is that my voice isn’t invited. I’m here to do my job because of the capacities that I bring. And so in many communities like that, we sign a contract, and I love that word. To contract somebody, to say, “Of all the things that you are, what I really want, Maureen, is just your capacity to do this one thing. And if you start bringing anything else, leave that at the door ’cause we’re not interested.” And that’s an agreement that we’re making when we bring you in for a specific thing that you’re doing, and I don’t wanna know any of the rest of this stuff, and you’re infinitely replaceable at any moment by anybody else.
And that tends to be in what we’re calling these low vibrancy groups, right? That it’s just not very engaging to be brought in that way. And people are marathon runners and can do this for very long periods of time. It’s shocking that humans can do that.
But it’s not a very engaging, [00:11:00] energizing place, and people that do that tend to have to medicate by running or getting a cup of coffee or going for a beer or doing something other than that afterwards. In contrast to that, we find groups that are really inviting, says, “I want you to bring the best of who you are. That’s why it’s exciting to have you in our community. And what is it that you’re learning about yourself as you’re doing this so that you can bring ever more of who you are? I mean, that’s why you’re here, ’cause you’re just an amazing individual to have in our community, and I wanna know what you’re seeing and learning and being of who you are to bring the best. So I invite your unique contribution, and therefore, I expect your best contribution.” And so in those communities that we’re finding that we’re labeling as high vibrancy groups where people describe it that way and very energizing, they don’t talk about contracts, they talk about invitations. “I’m inviting the best of you.”
But our declaration, our statement to each other is, “Because I’m inviting the best of you, then 100% participation is required, because you’re really good at what you do, and I need you to be there, so you [00:12:00] have to participate.” So shifting from a contract where people are in meetings that they don’t even know why they’re there, to saying, “You’re invited to participate, and therefore, almost 100% participation is required because you’re the one that brings that voice.”
So shifting from contracts to invitations, shifting from “I have to compensate you” — Don’t you love that? Compensation — I have to compensate you for being here and giving of your flesh and blood to be here, versus in a growth conversation about what is the value you bring and what is the value we bring to you for your unique contribution.
Those are examples of very specific organizations. I’m thinking an accounting firm and a textile mill. So we’re not talking about things that would be lovely if they existed. These are real companies doing that on a daily basis.
Maureen: So I used this methodology with one of my clients, and one of the things I really like is the differentiation between the three levels of vibrancy.
So in the highest vibrancy level, my client was able to see the possibilities of what he was [00:13:00] creating and this client had amazing vision. The next level is with that vision, what do I need to develop in my people and my organization to make that possible? And then the third level is the outcomes. And it was interesting to look at the group.
We had some people who could meet him in the place of possibility and other people, they didn’t know how we were gonna get there, but they trusted him. And then going through this very structured process of if this is our vision, what do we need to do to get there? And what agreements do we need to have in place to do that? And then third, delivering results.
And the feeling of, “I’m a trusted member of this team, and what I bring is important,” is so different, at least to me, from clients where I’m just saying, “Tell me what to do, because it doesn’t matter what I think.”
So what is it that we can do from a business perspective to drive economic value and from a human perspective to create environments [00:14:00] where people love the work they do and they go home feeling energized? They’re better parents. They’re better spouses. They’re better partners. They’re better community members. All of these things because of building this capacity to form agreements. So let’s go back to Ana Claudia, and tell us a little bit more about the experience.
What happened? What kind of results were you getting?
Ana Claudia: The previous example that I was telling you: we thought we had to have a structure and strong backup program.
We need sharing, knowledge sharing. We didn’t have that kind of culture of knowledge sharing. And to do so, we opened the space to the people in the organization to share whatever kind of gifts they have related or not with the business. We did the invitation and nothing happened during the first six months because people are not used to be treated as a [00:15:00] person, a complete person. But after six months, people come with a lot of ideas, and some of them were preparing a diploma course in association with a university and with a specific subject matter related with the business.
Some other ideas is partnering with some providers to build up an event: a day focused on technology and searching for new technologies and ways to apply that. And that gave them the possibility to learn how to share. That sharing for the organization is fundamental because with that kind of practice of sharing knowledge, we could have this leap from the knowledge of one subject to the profound knowledge of four subjects.
It’s a very concrete measure of changing agreements because [00:16:00] never ever people were invited to bring up their initiative, and that have a bottom-line result. In three years, we have a bottom-line result of approximately 20% of our yearly budget. So it’s significant.
What we do know is then people are more happy, they are more productive, they can deliver more of themselves, and the quality is much better. It’s very clear when we think as an economist and as a CEO or executive, we’re paying a salary, and we are having just 20% of the potential of that individual? It’s absurd. It’s absolutely absurd. Maybe Anabel can also talk about that experience.
Annabel: Well, there’s two things I want to talk about the experience. One is one of the examples that Ana Claudia was talking about that for me was the [00:17:00] perfect example of out-of-the-box thinking, that was this small group building up a really full program with an university and teaching that to the inside workers and for also for the partners and for the clients.
So that, that was something that that happened, and that helps to bring up individual results and make better relationships with the client and with the other providers. So that, that was, like, a huge example of what can happen with this kind of design. And the second thing is this kind of process helps you to have a really good assessment and to be changing the design, adapting the design depending on where is the people and where is the organization and what the organization is ready to go into the next step.
In this example with the bank, we did that in the [00:18:00] very first part of the process, but at the end of the process, we were doing very interesting things about people expanding their learning capabilities. So they were already into the sharing, and they were already into learning how to share with others how they knew and h- and the knowledge and capability and the skills.
So, uh, in, in a second phase, we were doing programs to help them to realize that they could be learning even more than they could imagine. And that was another great experience, a beautiful experience on how to look at people doing that because, I have, like, a tons of examples of individuals that really expand the capabilities of how they do that.
Maureen: So it sounds like in, in your examples, people are moving from twenty percent productivity to significantly higher. And that the organization in [00:19:00] leveraging their skills created more profitability, smarter people, all which are driving flexibility.
So we, we take the survey, we look at agreements, and we also map where am I losing financial return and human potential regard to each of these agreements. Can you tell us a little bit about that?
Annabel: We had a chance not only to do the survey and the agreements map, but we measured the cost of scarcity in the beginning and the cost of scarcity at the end, and the difference is the real impact of that transformation.
So for executive perspective, it’s much more powerful to have a really scientific and proved and serious study that can tell you how much was the impact of a transformational process. It’s much stronger to have that kind of [00:20:00] proved concrete measurement than I have the feeling that was good. That’s one of the reasons why I think this framework makes a lot of sense nowadays, is having concrete tools to measure, to assess the impact of a transformational process.
Maureen: And the tools also, I’m assuming, directed where you invested your energies. I do the mapping, it tells me the highest return is here, so you are gonna focus on those, obviously, right? You’re not gonna focus on the stuff that doesn’t matter. Uh, and the reason I bring that up, though, is we don’t always have such a clear map on where to focus.
We know there’s something broken. We know that something’s wrong, and then we tell people to go figure it out, and they, they decide to have pizza lunches. Well, that doesn’t really fix the engagement problem. It makes them not hungry for pizza on Wednesdays.
And having been in organizations that were vibrant and those that weren’t, there’s a real difference. I-if you just take a minute and [00:21:00] think about where were the places you worked where you were most productive and most excited, and where were the places you couldn’t wait to get out?
So how do we create these places that are more vibrant? And then the tools that underlie those are: what agreements are we making? There are such a broad range of things that we do, levers that we pull, in essence, in running organizations, and this agreements map really helps us look at what are those levers, and they’re not always what we would intuitively think, which is why we haven’t fixed them.
Jim has suggested that you can take the assessment for free, and we strongly encourage you to do that. And think about then what is your next step in how do you frame your agreements within your organization or within your family, and what one agreement might you change to help you be more effective?
Thank you again to Jim, Annabelle, and Ana Claudia for sharing your experiences and wisdom with us.