My department heads are all hitting their individual departmental Rocks, but as a collective leadership team, they fail to collaborate on cross-functional strategic goals. How do we measure and incentivize the performance of the leadership team as a single, cohesive unit?

Question

Tyler Smith · Accepted Answer

If your department heads are hitting their individual department metrics but the company is missing its overall goals, you have a team of highly functional silos, not a cohesive leadership team. When executives are only evaluated on their departmental performance, they instinctively protect their own resources and headcount at the expense of the larger business.

To fix this, you must align their incentives with the overall success of the company. In EOS®, this alignment starts with the V/TO®. Your leadership team must collectively own the company's annual and quarterly goals.

Tie a significant portion of their executive compensation and bonuses to the achievement of corporate Rocks and overall profitability, rather than individual department targets. If the company does not hit its quarterly revenue and net profit targets, no one on the leadership team gets their full bonus, regardless of how well their individual department performed. This structural shift instantly changes their behavior.

Additionally, use your weekly Level 10 Meeting™ to foster cross-functional accountability. When an issue arises in operations, it is not just the operations head's problem; it is a leadership team issue. By using the IDS® process together, the team learns to collaborate on solutions that benefit the whole company. When your leaders start thinking like owners who share a single bottom line, they will naturally stop protecting their silos and start collaborating to build enterprise value.