As a leader continuously working to develop your leadership skills, you may find yourself relying heavily on systems, processes, and checks to ensure your team operates efficiently. While these are crucial, there’s one major element that can undermine even the most foolproof system—workplace dynamics. Have you heard the saying “Culture eats strategy for breakfast”? It's absolutely true.
Many leaders feel good about checking all the boxes when it comes to employee or team member processes but pay little attention to the warning signs of dysfunction within their teams because they feel like they’ve done “all the things”. Leaders also often mistakenly believe that if there was an issue, someone would bring it to their attention. This rarely happens – especially when there is dysfunction at play.
Why should leaders care? No matter how well-oiled your processes are, toxic behaviors and poor relationships will always find a way to trickle down and show up in your business results.
Business Outcomes Don’t Lie
Even if you don’t hear complaints from your team, you can see the results of dysfunctional dynamics in key business metrics. Look out for signs such as:
Increased turnover, especially with high performing employees because they can’t thrive in a toxic environment. They know their worth and understand their energy will be better spent and amplified in thriving environment.
Low Engagement and Productivity. A disengaged workforce leads to lower productivity.
Lower satisfaction scores, as customers experience the ripple effects of a dysfunctional workplace. If your clients are voicing concerns, receiving inconsistent service, or noticing a drop in quality, your workplace dynamics could be the cause.
Miscommunication or missed communication. When departments aren’t aligned, or there’s a lack of communication, the outcomes are missed opportunities and confusion. No significant progress is made as the focus is on surviving, rather than thriving.
Poor morale is a silent killer of team performance. When employees feel disconnected, unsupported, or unappreciated, their engagement drops. This isn’t just about being unhappy—it affects how they show up for work, contribute ideas, and push through challenges. A Harvard Business Review article titled “The Price of Incivility” by Christine Porath and Christine Pearson, proved that employees are 48% less productive when stuck in negative team dynamics. Ask yourself: “What if my team members were 50% MORE productive?" “What would that mean for business results?” You would be hard pressed to find anything that could improve productivity so drastically - and at no extra cost!
You may also notice the following:
No one seeks or offers feedback. Like I mention above, many (if not most leaders) mistaken this silence as a sign that everything is fine. “No news is good news.” so the saying goes, however if silence is accompanied by lagging results, its most likely an indication that team dynamic problems are lurking under the surface.
Certain groups form and others are left out. This leads to disjointed collaboration and creates a culture of "us vs. them." When this mindset sets in within a team, it’s hardly conducive to a collaborative environment where everyone works towards the same goals.
There’s a general sense of tension in the air - a clear sign that workplace relationships are fraying.
When discussing roadblocks or the team’s shortcomings, there is a lot of finger-pointing. There is rarely ownership of the problem. There’s always a reason – and according to them, it’s never their fault.
Proof that Culture Beats Systems
Companies with healthy workplace dynamics tend to have more resilient teams, higher innovation rates, and better long-term performance due in large part to hightened employee engagement. Gallup has also reported that companies with engaged employees can experience 21% higher profitability. Meanwhile, dysfunctional cultures drive talent away and lead to wasted resources, as employees disengage or leave altogether.
I think I may be leading a dysfunctional team…what can I do?
If you’ve identified some potential problem behaviors or dynamics within the team, you can start by taking immediate steps:
Model transparency and openness yourself.
Tackle conflicts head-on, and make it clear that team dynamics matter just as much as technical outcomes.
Recognize and reward not just high performance, but also collaboration, empathy, and leadership at every level – behaviors that are aligned with the desired outcomes.
Hold ALL team members accountable – not just for their share of the work, but for contributing to a healthy, positive and collaborative work environment for all.
If you’re struggling to find ways to do this, simple regular 1-to-1's are a great habit to instill. While technical issues can be addressed, it’s important to also make time for more rounded discussions around team dynamics. Below are 8 open-ended questions that can help initiate this open dialogue with ALL of your direct reports:
Question #1: "What’s been the most rewarding part of your work recently, and why?"
Question #2: "Is there anything that’s been particularly challenging for you lately? How can I help?"
Question #3: "How do you feel about the current team dynamics? Are there any areas where you think we could improve?"
Question #4: "What’s one area you’d like to develop or grow in, and how do you see us supporting that?"
Question #5: "How do you feel about the balance between your workload and personal time right now?"
Question #6: "How do you think we can improve the communication and collaboration within the team?"
Question #7: "Can you share an example of something that went well recently that we should replicate in the future?"
Question #8: "If you were in my position, what’s one thing you’d do differently to help the team or the organization?"
By staying attuned to the signals of dysfunction dynamics, you can address the root causes before they damage the team and/or your business. Leaders who create a healthy, thriving environment will see those benefits reflected in the bottom line.
If you are looking for a more customized leadership development experience, leadership coaching may be the better option to get you to your professional development goals faster. Book a complimentary “Discovery Call” to discuss your goals and see if working with a leadership coach might be the way to go.