The Hidden Costs of Mediocrity in Business

Companies often focus on big strategies, such as market expansion or digital transformation, innovative products like the latest smartphone or a breakthrough drug, and cutting-edge technologies like AI or blockchain in pursuing business excellence. While these elements are undoubtedly critical, mediocrity is another frequently overlooked factor that can significantly impact an organization’s bottom line.

Mediocrity, often characterized by a lack of ambition, innovation, or effort, can manifest at all company levels, from leadership to blue-collar workers. This type of culture can be identified and measured through key performance indicators (KPIs) related to productivity, innovation, and employee turnover. When these KPIs consistently fall below industry standards, it’s a sign that mediocrity is eroding the company’s performance.

The impact of mediocrity can be seen in several ways:

Reduced productivity

Imagine having a team where every member is unwilling to go the extra mile. This lack of productivity can harm the company’s efficiency and overall performance. Mediocre individuals who are less productive can create an unproductive environment where results are unsatisfactory and efficiency suffers.

Diminished innovation

Teams that lack innovation play it safe, do not make much effort, and leave only today. Nothing can make them even start thinking that something may change. Risk is at the lowest level possible. These teams hinder the development of new products, processes, and structures. They stay with what is known better. They do not intend to search for improvements. They first slow teams’ productivity and then impact company performance with their behavior.

Increased turnover

Mediocrity can lead to high turnover as energetic individuals seek environments that resonate with their nature. This turnover can significantly impact a team’s capability, knowledge, and expertise in different areas, creating an urgent need to address the issue.

Damaged reputation

Remember a role in a different team or company you wanted, only to find during the process that the feedback for that team or company was not positive? The more a team supports mediocrity in the workplace, the weaker the company becomes. Mediocre-performing teams struggle to attract potential talents who may help them overcome their helplessness. Not having innovators and talents negatively impacts relationships and the number of customers interacting with the team.

Missed opportunities

The combination of all the above-mentioned characteristics of a mediocre team and place evolves in “preventing” the organization from capitalizing successfully on different market, society, and environmental opportunities.

Mediocrity may be seen as a struggle, but it is up to the company and its leadership team to decide whether to continue supporting this situation and environment or focus on working to change it. The urgency of this decision cannot be overstated, as the longer mediocrity is allowed to persist, the more it will erode the company’s potential for success.

There is no such thing as a constant state of mind, behavior, or action agenda, especially regarding company repositioning and survival. After all, if someone decides to act mediocrely, they can mainly damage their environment. Still, if a company does it, it may affect all those who demonstrate mediocre behavior and make others suffer.

And YES, it is not easy to change the attitude and turn a mediocre culture into a high-performing one. However, the action agenda and leadership team who want it badly can make miracles with the right effort and strategies. Here are five strategies a leadership team can implement to ensure that accurate and impactful changes will happen and mediocrity will turn into high performance and care. So here is what a leadership team can do to save the company from getting the stamp of mediocrity. The potential for transformation is significant, and with the right approach, mediocrity can be overcome.

1. Defining Clear Expectations and Goals:

• Set ambitious but achievable targets: Mediocre teams and companies often lack an understanding of the core—vision, mission, and values. The most significant impact here may happen when the leadership team clears those elements and communicates their impact and connection to the future understandably and acceptably. The more precise the messages are articulated, the better people will understand their roles in the agenda that is happening now and what needs to happen in the future.
• Establish performance metrics: Talking about a brighter future is a good start, but to improve from what is now, the leadership agenda should include a way to measure progress. Developing key metrics to underline progress is not an easy process. However, the more these metrics are connected to the company’s objectives and provide regular feedback for further improvement planning, the higher their impact on the transformational goals.

2. Foster a Culture of High Performance:

• Recognize and reward excellence: In short, this means focusing on recognizing, acknowledging, and celebrating achievements and impactful contributions on all levels. This not only motivates individuals to strive for excellence but also makes them feel valued and appreciated, fostering a positive work culture.
• Promote a growth mindset: Sounds easy, right? Still, dealing with people’s attitudes is difficult because they change slowly and painfully. The simple action here is to decide what a Growth mindset means for the organization and how it is defined and put some real agenda on how to support it. This may mean encouraging learning from mistakes instead of judging them, promoting challenges and struggles, and speaking up and acting toward the constant development of skills for everyone
• Create a positive work environment: Sounds good, but positivity is in the eyes of the beholder. What may look acceptable or OK for one may be a severe disturbance in the heads of others. Despite that, the focus should be on defining standards for collaboration and defining what open communication means, with all levels of stoppers and supporters for it and communicating and supporting it through the organizational structures with clear and precise action plans.

• 3. Invest in Talent Development:

• Identify high-potential employees: While in the years behind, this was a blurry expression more used by HR people, leaders have started understanding that term and implementing it as a priority in their agendas. It started back in time as an insecure action agenda focusing on hard skills, but nowadays, if a leader wants to move forward, investing in training and development for everyone and differentiate those who only need hard skills and those who need structured programs for leadership development is a crucial element of the long list of things to help the organization embrace change and limit mediocrity.
• Provide growth opportunities: While seen as an essential part of what companies do, leaders still poorly understand GROWTH. They still need to learn that the time when people grew up led by leaders’ vision is over. Nowadays, flexibility is essential. The learning paths should be designed to help the organization and the individual feel that they are growing in their unique and acceptable way. This may help people stay in the organization and move the mediocrity far away from the ongoing daily and strategic agenda. Encourage continuous learning: With learning on the path of growth, people must focus on staying on track with what is essential for them and the organization. One-time learning exercises have been around for a long time. Once embraced as an idea for change, continuous learning is a mandatory strategy component to keep the organization on the winning path and keep people inside it for a long time. The focused efforts in this direction create a sustainable cultural pattern of lifelong learning by providing access to educational resources, developing and executing training programs and curriculums, etc.

4. Lead by Example:

In the end, the obvious thing to do is the mantra that all leadership gurus and trainers preach today—LEAD BY EXAMPLE. And that means everything and nothing at the same time. Let us set some essential criteria for what it can mean for an organization and leadership teams that do not act mediocre but proactively and with the thought of winning the agenda for the organization now and in the future.

• Demonstrate a strong work ethic: Examples start when people feel threatened or supported personally – THE ETHICS. Exemplifying this level can win or lose people for the organization and its broader and long-term agenda. It is essential to demonstrate a strong work ethic and act according to the company-wide standards and values the leadership team has preached. Everything seen as a discrepancy between established and communicated standards turns trust into negativity and lowers morale, internal motivation, and engagement. The fundamental mission vision and values are crucial to creating a connected mindset that not only understands the basic rules and expectations but also accepts them as standards for personal contribution
• Communicate effectively: Still, after so much has been written about it, communication remains one of the most misunderstood elements of the set of tools, balancing organizational growth and lowering mediocrity. Organizations and leadership teams often do the first part of this exercise perfectly – communicating the mission, vision, and values in a simple, concise, and understandable way and screwing it up on the second part – showing people how their role contributes to the organization’s long-term strategic agenda. Setting mission, vision, and values as standards look more like a controlling tool if not connected to the personal contribution as an element. Making people understand how their unique role contributes to the organization’s success, aligned with behaviors, expectations, and actions, is crucial to ensure a high level of understanding of the communication agenda set by the leadership team. That creates effective organizational teams and pushes organizations to new limits.
• Hold employees accountable: The old way of thinking in the 20th century was that the manager is responsible for the employee’s results, behavior, and performance. And this couldn’t be more wrong. Taking responsibility for the person for their actions, decisions, and consequences is a prerequisite to creating an organization with low morale, lazy and unproductive staff, and non-motivated and internally engaged people. On the other side, establishing clear Accountability standards and giving people the opportunity and freedom to make decisions but also work with the consequences of their choices is a sign of maturity and a high level of trust and hinders mediocrity in favor of productivity, high levels of of of engagement and positivity in the team.

5. Embrace Change and Innovation:

Many years ago, I joined a large organization that promoted innovation and freedom of action. At the end of the first month, I realized they had been stuck to what they knew better and did not want to move in any direction. And that has made them blind to what is happening around them. Quickly, they lost clients, but because the universe of potential clients was quite big, they didn’t see it as a struggle. People were told how great they were, but in reality, they lacked the essential skills to sell company products successfully and relied more on the famous brands in their portfolios. The sales team was more like a well-paid merchandiser instead of good salespeople, the HR stuck to what they knew best and didn’t change their approach toward the other parts of the organization, the Marketing team was stuck in a global agenda and found themselves excuses, not to present anything new and innovative enough. And one day, this all caused a drop in sales and the need for a new agenda that could make the company great again. With the insights from the market, the CEO’s team on a global level introduced two new business lines (something never done in the company’s history), and priorities changed. After a short assessment, the organization understood they had missed valuable opportunities in the time behind. Now, they were trying to catch up with the market, which caused people to feel exhausted and demoralized, leading to mediocre results in several areas for the first two years after the innovation was presented. Many left the company, while those staying in it didn’t embrace the change and tried to save themselves by closing in on what they knew best and skipping everything else.

Although the story looks sad, it is a true story of a giant in a business area that sold favorable products at the time and still does it even today. If they had done this differently, maybe the pressure would have been lower, and the agenda would have been more balanced if they had done it step by step instead of simultaneously rushing with several global projects. Done differently may have meant that leaders show behavior aligned with several actions and values. Here they are below:

• Encourage experimentation: Nothing new can create fear in people’s hearts and minds. It is normal. After all, we live in our comfort zones, and leaving them is always unpleasant. To push these limits to new heights, leaders must first create a “sandbox” where people feel safe to experiment and propose new ideas by taking calculated and unpunished risks.
• Foster a culture of agility: What many leaders and organizations miss is the changing environment around them. Stuck to what they know best, they miss the signs from the outside. For example, Blackberry and Nokia – once the best-known manufacturers of cell phones- are now in history. The same happened with Kodak and many others. At the same time, giants like PepsiCo have turned their questionable results from the sparkling drinks market into a real profit by embracing the change, understanding the market, buying other categories of products, and building entirely new business structures. Now, PepsiCo makes the smallest profit from what was once the central part of their portfolio stars – sparkling drinks. Leaders must encourage people and themselves to embrace change and support flexibility, agility, and adaptability as key contributors to company success by acknowledging environmental changes and appropriately acting toward them.
• Celebrate failures: This one is easier to say than do. In people’s nature, there is a habit of comparing ourselves to others. Some call it jalouse, while others see it more professionally as a compensation mechanism. But after all, it is an attitude that should be managed and controlled. We tend to celebrate our wins loudly and, at the same time, try to hide our mistakes as profoundly as we can. It is part of the human nature. But what an enlightened leader once said, “We will only be successful if we start celebrating our failures.” And damn, he was right. Seeing failures as just safe and trying to achieve something new and revolutionary can change attitudes and perspectives, make people and organizations more accustomed to the positive changes, and help them focus on what adds value instead of what hinders it. After all, it is a tool to lower mediocracy and turn it into innovation and support

IN CONCLUSION:

After all that has been written, I hope you see that overcoming mediocrity is not a quick fix. It requires a sustained commitment from leadership and employees. After all, mediocrity is a choice. By striving for excellence, companies can differentiate themselves from competitors and build a strong foundation for growth.