Article

At a glance: Most companies do not fail because they have the wrong strategy. They fail because they do not execute it consistently. Five often overlooked factors determine whether a strategy delivers growth: communicating it every day rather than just once; treating cultural change as an ongoing leadership responsibility; building trust before a transformation begins; recognizing employees' emotional commitment as a measurable driver of productivity; and dominating a category rather than merely competing in it. All five are considered "soft" factors, yet each can be measured. The article closes with five questions every leader should ask.

The hidden obstacle: The strategy itself is rarely the problem

Consider four possible scenarios:

• The right strategy is executed consistently.
• The right strategy is not executed consistently.
• The wrong strategy is executed consistently.
• The wrong strategy is never executed in the first place.

In the vast majority of companies I work with, the situation is this: They have a strategy that is fundamentally sound and has required substantial investment and thought, both internally and externally. Yet the organization still struggles to put it into practice.

When a strategy is a poor fit, the people around a company are often the first to sense it. Employees, customers, and sales partners have a keen sense of whether a direction is sincerely intended or merely stated. One prominent example from recent years: In 2022, Mercedes-Benz adopted an uncompromising luxury strategy, only to abandon it a few years later, saying it had never pursued a luxury strategy at all. It is easy to imagine the effect this has on employees, customers, and dealers.

The real mistake is rarely the ambition. It is the failure to explain convincingly why this particular strategy is right for this particular brand. Without that explanation, doubts go unanswered. This applies to global brands and mid-sized businesses alike. In the latter case, the audience is the company's own workforce rather than the public. The conclusion: Strategy alone is not enough. How it is communicated matters, too. Poor or absent strategy communication makes growth impossible.

Five factors that determine growth

1. Strategy communication: Mobilize people instead of merely informing them.
2. Cultural change: Treat it as a leadership responsibility, not a project.
3. Trust: Build it before you need it.
4. Employees' emotional commitment: Recognize this overlooked driver of productivity.
5. Competitive positioning: Own a category instead of simply putting offerings on the market.

Lever 1: Strategy communication: Mobilize people instead of merely informing them

In many companies, strategy communication is treated as an event: twice a year, at a strategy day or a town hall. That is not enough. Strategy communication is not information to be distributed once. It is a daily leadership responsibility. Its purpose is not simply to make sure employees know the strategy. Its purpose is to mobilize every individual. If even one person is left out, that is one too many.

Companies that take this seriously show what it means in practice. Siemens says it communicates its strategy—its journey toward becoming a "One Tech Company" that brings together the digital and physical worlds—in every leadership interaction: why decisions are made one way rather than another, why tasks are delegated, and how individual steps contribute to the bigger picture. That consistency shows in the results.

The idea that a well-explained vision moves people is hardly new. Harvard professor emeritus John Kotter has shown that more than 70 percent of transformation programs fail to achieve their goals and that leaders typically undercommunicate the vision by a factor of ten¹. Those responsible for the moon mission apparently understood this: They commissioned comics for the engineers involved so that each person understood what they were building and why it mattered.

My practical recommendation: Use two or three slides at every suitable opportunity. Show them not once, but again and again: Why are we doing what we do? Where are we on track, and where are we not?

Lever 2: Cultural change is a leadership responsibility, not a project

In many companies, culture is delegated to HR and organized as a project—with the mistaken assumption that a project eventually ends. That is precisely why so much culture work has little lasting effect. It helps to look briefly at the term itself: Culture is the sum of a community's intellectual, artistic, and creative achievements, characteristic of that community at a particular time and in a particular place.

Two words matter: community and characteristic. The first leadership question, then, is: How do we—from the executive board down—become a community rather than a collection of individuals working separately? The second is: What makes us distinctive? This is a question about growth, not an academic exercise. Distinctiveness is one of the few proven drivers of brand growth. The more distinctive a brand, the stronger its growth. Yet many companies prefer to follow competitors rather than develop a character of their own, then wonder why growth fails to materialize.

Community grows from shared values, and values become shared only when people actively work on them. Writing a book or printing a poster is not enough. Hilti makes this a consistent part of leadership work: The company invests around ten million Swiss francs a year in helping every employee work in line with its values. Among other initiatives, "values sherpas" work with teams during multiday "Culture Journeys" to explore what the value system means for everyday collaboration. This happens repeatedly, not just once. BMW also shows how culture can be expressed externally: Through its own lifestyle collection and the tagline "Goods with Freude," the brand makes a central cultural theme visible and tangible. Its performance relative to competitors reflects this.

Culture work, then, is anything but vague or arbitrary. It can be learned, it belongs on the leadership agenda, and—as we will see below—it can be measured in concrete terms.

Lever 3: Trust must be in place before you need it

Employees follow a new strategy or a transformation only when they have trust. The crucial mistake is one of timing: Starting to build trust in the middle of a transformation is too late. Trust must be in place before it is needed, both inside and outside the company. Whether customers buy because a company is superior or because they trust it ultimately comes down to trust, too.

From a research perspective, trust rests on three components:

1. Competence: Without it, nothing else matters. No one follows a mountain guide who does not know the mountain.
2. Goodwill: A genuine, perceptible commitment to doing right by customers and employees.
3. Integrity: The component most widely understood but least often practiced. It means making decisions, acting, and communicating consistently in line with your own values and strategy. Not occasionally, but every day, in every moment, with every decision - and repeatedly explaining how those decisions connect to the company's values.

A study of high-performing teams conducted by Google with Harvard shows what a clear framework for action can achieve. Two factors proved especially important: clear performance expectations and psychological safety. People need to know the boundaries within which they can act, make mistakes, and develop. Without either factor, progress stalls. Expectations without safety create a culture of fear. Safety without expectations may feel good, but nothing moves forward. Only the combination of clear goals and a framework for action defined by values and positioning enables development and growth.

Lever 4: Employees' emotional commitment: The overlooked driver of productivity

Emotional commitment develops when employees can identify with their company's values, see those values put into practice, and build shared successes and experiences over time. This is more than a feeling. Studies show a direct link between employees' emotional commitment and measurable outcomes: It can reduce absenteeism by up to 78 percent, substantially lower workplace accidents and quality defects, improve customer ratings, and noticeably increase productivity.

Emotional commitment is therefore just as relevant as cutting costs: It is the counterpart on the revenue side. Many companies work intensively to reduce costs, but few work systematically to increase productivity through commitment. This is especially important when a company has to reduce its workforce. Those who remain need to feel emotionally committed; otherwise, a difficult period becomes a productivity problem with lasting effects.

Lever 5: Competitive positioning: Own a category instead of simply putting offerings on the market

The final lever looks more concrete than the other four, and it is. Yet it, too, is often underestimated. It is about dominance. The question is not how well positioned you are in your market, but who actually dominates that market. Consider an example from medical technology: A provider of breast prostheses defined its market not as a product category, but around the goal of helping women who have had a breast removed live without unnecessary limitations. It then developed offerings to own that category.

Studies of the world's most valuable brands repeatedly show that companies that establish, shape, and dominate a category achieve significantly greater increases in value than companies that merely place offerings in an existing market. This changes how we think about products, services, and communication. The goal is not to launch another offering, but to own a category that belongs uniquely to your brand. That includes editorial content and sustained work to advance the entire category, not just your own offering.

What this means for your agenda

A mid-sized medical technology company I worked with had stagnated for five years. It was caught in a crisis of purpose and had lost its drive, even though its business strategy was clear. The turnaround did not come from a new strategy. It came when, over three months, the company rediscovered what it stood for and why it wanted to grow. That is the substance behind all five levers: A brand is the concentrated expression of a company's ability to excel. And that ability does not come from another program. It comes from consistent, daily leadership work on strategy communication, culture, trust, commitment, and positioning.

Five questions every leader should ask

1. What is the real state of our company's culture? How do I know?
2. How many of our employees could explain, with conviction, what we stand for?
3. Do our most important customers buy from us because we are superior or because they trust us?
4. Where is our transformation really getting stuck: in the plan, or because too few people are following us?
5. As CEO—or within my own area of responsibility—what would I need to do differently if brand, culture, and trust had the same place on my agenda as revenue and margins?

None of these five levers can be moved by a one-off program. Despite their reputation as "soft" issues, all five are measurable: Strategy communication, cultural development, trust, emotional commitment, and category dominance can be assessed, tracked, and managed. That is where the hidden growth lies—the growth many companies leave untapped.

Contact

Want to find out where your company stands on these five levers today? Get in touch: growth@brand-trust.de 

References

[1] Kotter, Harvard Business School, "Leading Change," HBR 1995/1996