Building a High-Agency Culture

A company’s stock can plummet due to various reasons, but sometimes the problem lies within the company’s culture. General Electric’s debt load was a major concern, but the board identified a deeper issue: a culture that rewarded silence and punished error. A survey revealed that 62% of managers believed “calling out problems is career-limiting.” This mindset led to a 0.8 percentage-point erosion of operating margin each year.

A high-agency culture flips this equation. It is a work environment where every employee feels personally authorized and expected to act, fix, and learn without waiting for a formal sign-off. This shift from “who’s at fault?” to “how do we solve this now?” is a measurable lever on performance, risk, and talent retention.

Companies with high-agency cultures experience significant increases in employee engagement, customer satisfaction, and overall financial performance. For example, a study found that companies with high-agency cultures experience a 25% increase in employee engagement and a 30% increase in customer satisfaction.

GE’s Journey to Transformation

Larry Culp became the CEO of GE in 2018, inheriting a company with a declining market perception. Rather than reshuffling the portfolio, Culp’s first priority was cultural: creating a problem-solving culture. He dismantled the 14-layer approval process for capital projects, slashing decision latency by 41%. He also eliminated the forced-ranking system and introduced a peer-feedback loop that emphasized learning over ranking.

Culp’s changes had a direct impact on the company’s financial performance. GE Aerospace reported a $190 billion backlog and 21% year-over-year revenue growth by the fourth quarter of 2025.

He also eliminated the forced-ranking system and introduced a peer-feedback loop that emphasized learning over ranking.

The Power of Agency

Culp framed agency as the only asset that cannot be shorted. He introduced mechanisms to make agency a lived experience for every employee. The “8-hour rule” forced leaders to confront bottlenecks before they festered, resulting in a measurable drop in “time-to-decision” metrics.

By 2024, internal surveys showed 71% of employees could answer “my ideas move faster than 24 hours.” This shift was not just about speed; it was about creating an environment where employees felt empowered to take ownership of problems and solutions.

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Strategic Perspective: What Can We Learn?

The GE case proves that agency is not an abstract virtue; it is a set of engineered processes that reshape incentives, information flow, and accountability. Leaders looking to replicate the results should start with a diagnostic audit of blame signals.

Next, make failure visible by creating a dedicated channel where the CEO and senior leaders log their own misses first. Transparency cascades down. Align compensation to resolution metrics, and streamline decision gates. GE’s elimination of 14-layer sign-offs for sub-$25 million projects cut latency by 41%.

Critical Insights: Implementing Agency in Your Organization

Below is a practical playbook distilled from GE’s experience:

• Audit blame signals. Deploy a concise survey (e.g., “I can admit a mistake without jeopardizing my career”). Benchmark the results and repeat quarterly.
• Publish leadership failures. Create a dedicated channel where the CEO and senior leaders log their own misses first. Transparency cascades down.
• Tie compensation to problem resolution. Allocate at least 20% of variable pay to metrics such as “issues closed per quarter” rather than pure revenue targets.
• Introduce rapid micro-experiments. Allow teams to spend up to $5k on a three-hour pilot. If the experiment solves a problem in three locations, it graduates to broader rollout.
• Replace layers with clocks. Adopt an eight-hour escalation rule for any stalled initiative. Track compliance and publish the rate of on-time escalations.

Conclusion

Creating a high-agency culture is a strategic imperative for organizations seeking to drive sustainable growth and profitability. By following the playbook outlined above and making agency a lived experience for every employee, leaders can create an environment that encourages innovation, creativity, and experimentation.

Leaders looking to replicate the results should start with a diagnostic audit of blame signals.

As Culp noted, “Agency is the only asset that can’t be shorted.” By prioritizing agency, leaders can create a culture that drives long-term success and profitability.

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