We Didn’t Fail the Strategy. We Passed the System Test.

This is part 3 of a 6 series post on execution

Belief feels human. Incentives feel mechanical. For a long time, I wanted to believe belief would be enough — that if people genuinely bought in, they’d naturally align and figure the rest out.

It isn’t.

People do what they’re paid to do. They also do what gets them praised, promoted, protected, and left alone. Those signals communicate what we actually value, and they shape behavior. And behavior is what execution actually is.

What I missed for a long time is that those signals don’t sit outside the process. They are how values and choices become real.

So where do values actually show up?

Not in posters, decks, or town halls — hell, not even the “values” page on your new shiny corporate website. Values show up in decisions. They show up in what leaders fund, who they promote, what they tolerate, and what they’re willing to personally trade off.

Over time, those decisions harden into patterns. And those patterns become the values people trust—which then become your company culture.

That’s where values stop being abstract and start shaping how work actually gets done.

For a long time, I treated process as its own reason for failed execution. A separate bucket. Distinct from incentives and rewards. Something downstream of strategy that lived in ops decks and delivery plans.

I was wrong.

Processes aren’t flowcharts, Jira tickets, or approval steps. Process is our choices and values made repeatable.

If strategy is simply a set of choices — either written down or expressed through action: where to play, what to prioritize, and what we’re willing to trade off then process is how those choices get enforced. Processes are the mechanisms that turn intent into behavior.

Which means performance and promotion reviews? Process.

What gets budgeted versus what gets a polite “we’ll see next quarter”? Process.

Who gets praised in all-hands, and who quietly disappears? Also process.

If your strategy isn’t explicit about what it’s willing to invest — time, recognition, funding — in the behaviors it depends on, it’s incomplete. Outcomes aren’t enough. Aspirations aren’t enough. Strategy has to show up in the everyday choices people make when no one is watching.

I’ve watched teams genuinely believe in a direction and still behave in ways that quietly undermine it. Not because they’re disengaged or cynical, but because the environment — often unintentionally — makes other behaviors safer and more rational.

I’ve said we value long-term outcomes while incenting short-term wins. I’ve said collaboration matters while rewarding individual heroics. I’ve said focus is critical while praising people who say yes to everything and look busy doing it.

None of that was malicious. All of it was instructional.

Incentives don’t just drive activity. They teach people what matters. And when those lessons contradict the strategy, execution suffers quietly — even if belief was strong to begin with. At that point, the work stops being about outcomes and starts drifting into corporate theater: motion everywhere, very little actual progress.

This is exactly where this ties back to They never truly believed in the strategy, and it’s also what The Innovator’s Dilemma is really about. At its core, it isn’t a story about missed intelligence. It’s about rational people operating inside organizations that reward the present and, inadvertently, punish the future. The very mechanisms that make organizations successful — customer focus and efficiency — slowly become the constraints that trap them.

Incumbents listen to their biggest customers. They fund the highest-margin products. They promote leaders who hit near-term targets. All of that is rational. Rewarded. Revered. But disruptive ideas don’t look attractive through those lenses. Early on, they serve smaller markets, generate worse margins, and feel operationally awkward. Measured by existing incentives, the future looks like a bad bet.

This is what happened to Cloudera. Not a failure of vision or intent, but an organization behaving exactly as it was incentivized to behave. “Cloud Era” is literally in the name; the future was clearly understood. But fully committing to cloud-native services would have required deprioritizing the products, customers, and revenue streams the company was still rewarded for protecting. Cloud initiatives existed, but they lived on the margins — underfunded, slower moving, perpetually early. From the outside, it looked like hesitation.

So the dilemma isn’t that leaders can’t see disruption coming. It’s that acting on it requires violating the very rules that made them successful in the first place. That tension creates fear: fear of making the wrong investments, of betting too early, of backing the wrong horse.

And instead of absorbing that risk themselves, leaders often outsource it to the team. We ask people to execute the future with underfunded, under-resourced, under-visible, and undervalued work — and then act surprised when progress stalls.

That’s backward.

Leaders have to absorb that risk themselves by turning time, money, and attention into explicit rewards, incentives, and mechanisms people can actually feel in their calendars and performance reviews. That’s the part most strategies skip.

So belief in tomorrow doesn’t lose in a dramatic battle. It gets quietly outcompeted.

This is where execution failures get mislabeled as performance problems. What looks like underperformance is often perfect performance against the incentives in place.

People aren’t rebelling. They’re doing exactly what the organization signals it expects them to do. Over time, people stop listening to what’s written and start responding to what’s reinforced.

That’s culture.

There’s a line from Atomic Habits that gets quoted a lot by my good friend: you do not rise to the level of your goals. You fall to the level of your systems.

That framing is uncomfortable for leaders, because systems don’t exist in the abstract. We design them. Or we allow them.

The accountability is on us as leaders.

Goals don’t fail on their own. Systems don’t either. They do exactly what they were built to do. When execution fails, it’s tempting to say we missed the goal. That framing is comforting. More often, we didn’t fail the goal.

We passed the system test.

When it happens, the question isn’t why people didn’t do the right thing. The more honest question is simpler, and harder: What behavior do our values and systems make rational?

Because if incentives point away from the strategy, execution isn’t failing.

It’s working exactly as designed.

This is part 1 of a 6 part series on execution

1. I Blamed Execution. The Truth is Much Harder.
2. They never truly believed in the strategy.
3. Incentives, rewards, and mechanisms reinforced behaviors that conflicted with the strategy.
4. We hadn’t developed the skills the strategy required.
5. We had the wrong people for the strategic choices we made.
6. We measured execution poorly — or not at all.