In May 2026, Bloomberg ran a piece on how CEOs across the world’s largest non-technology companies are simultaneously discovering that their workforces have somehow become insufficiently ruthless. Unilever’s Fernando Fernandez opens every meeting by reciting his quarterly targets out loud before saying hello. Nestlé’s Philipp Navratil has promised investors he will be “ruthless in assessing our talent.” Citi’s Jane Fraser has reminded staff they are judged on results, not effort. Novo Nordisk’s Mike Doustdar is restructuring a Danish drugmaker to behave more like Tesla. And 3M’s Bill Brown is using the word “relentless” with notable enthusiasm.
That last one is the joke, and the joke is on us.
3M is the company that invented Post-it Notes by allowing Spencer Silver, one of its chemists, to spend six years failing to find a use for an adhesive that was too weak to actually stick anything to anything else. The compound — a low-tack, reusable pressure-sensitive adhesive he stumbled onto in 1968 — was a textbook failed experiment. He gave internal seminars about it. He wrote it up. He couldn’t find anyone interested in productizing it. Then in 1974, another 3M scientist named Art Fry, who sang in his church choir and was annoyed that his hymnal bookmarks kept falling out, remembered Silver’s useless adhesive and put it on a piece of paper. Post-it Notes launched commercially in 1980 — twelve years from the original failure to the product that became a billion-dollar category and a permanent cultural artifact.
Under the performance culture Bill Brown is now selling, Spencer Silver gets the lowest performance ranking, half his bonus, and a conversation about whether he is a fit. Art Fry never gets to play with the adhesive because he is too busy hitting his quarterly numbers in the tape division. The product never exists.
This is not a sentimental complaint. It is a strategic one. The CEOs in the Bloomberg piece are confusing two very different things — performance and productivity — and importing a management posture from companies whose strategy they do not share. They are, in the most literal sense, running a cargo cult.
Performance Is Not Productivity, and Neither One Is Innovation
Performance is output measured against a pre-specified target. Productivity is output per unit of input over time. The two are related but they are not interchangeable, and neither of them captures the only thing that builds durable competitive advantage in any non-commoditized business: invention, judgment, and the willingness to make bets that probably will not pay off this quarter.
When Navratil tells Nestlé managers that conduct and comportment will no longer matter as much as hitting numbers, what he is operationally saying is that the company will now reward people who deliver short-horizon, observable, pre-specified outcomes and punish everyone else. That is a perfectly reasonable framework for running a payroll department or a logistics pipeline. It is a catastrophic framework for R&D, brand development, key account management, customer-facing innovation, or anything else whose value compounds slowly and shows up in places you cannot reliably forecast.
You can run an oil refinery on this culture. You cannot invent a new business inside it.
The Cargo Cult: Why Big Tech’s Logic Doesn’t Transfer
The most important thing to notice about the current layoff wave is that it has two completely different theses behind it, and the executives invoking them are pretending they are the same thesis.
The big tech thesis is real, even if it turns out to be wrong. Meta, Microsoft, Google, Amazon, and the rest are spending several hundred billion dollars a year on AI infrastructure. They have a coherent — if aggressive — story about why this capital expenditure pays back: a meaningful fraction of white-collar labor inside their own organizations will be substituted by their own AI systems within a decade, so they should capture the savings now and absorb the productivity gains as the technology arrives. You can argue with that thesis. You cannot say it is incoherent. When Meta cuts six hundred people from its AI division and tells the rest they are now “more load-bearing,” that is at least a strategy.
The non-tech thesis does not exist. Nestlé is not building data centers. Unilever is not training frontier models. HSBC is not racing Anthropic and OpenAI for the next generation of architectures. They are selling KitKats, shampoo, and corporate deposits. They have no proprietary path to capturing AI productivity gains that justifies stripping tens of thousands of jobs from their own organizations. What they have is a peer group of CEOs cutting heads, an analyst community rewarding the optics, and bonus packages that vest before the consequences land.
This is the textbook definition of cargo cult management. The original cargo cults were Pacific islanders who, after watching Allied forces during World War II build airstrips that summoned planes full of supplies, attempted after the war to build their own ceremonial airstrips out of bamboo to summon the same planes back. The form was copied. The mechanism was not understood.
Watching a non-tech CEO announce a performance culture to investors while pointing vaguely at AI is the corporate equivalent. The form — layoffs, stack rankings, intensity rhetoric — is borrowed from companies whose strategy is actually about technology substitution. The mechanism — proprietary AI investment, technical leverage, software-based scaling — is not present and is not on the roadmap. The bamboo airstrip is the press release.
What This Actually Breaks
The predictable consequences of ritualized performance culture are well documented, and they do not show up in the quarter the policy is announced. They show up two to five years later, by which time the CEO who announced the policy is either retired, promoted, or focused on his next initiative.
Microsoft ran a stack-ranking system from the 1990s until 2013, when it formally killed the practice after roughly two decades of evidence that it had become, in the words of its own internal reviews, the single most destructive process inside the company. Engineers refused to work on the same teams as other top performers because the curve guaranteed someone would be rated low. People hoarded information. They sandbagged commitments. They gamed peer reviews. Yahoo’s Marissa Mayer imported a similar system the same year and watched it accelerate the company’s collapse. Jack Welch’s original rank-and-yank model at GE — the prototype for everything Navratil and Doustdar are now reinventing — has been repudiated even by GE’s own subsequent leadership, and the company that pioneered it spent the 2010s being broken up.
Teresa Amabile’s research at Harvard Business School has spent thirty years documenting the cognitive consequences of running this play. Threat, surveillance, and short-horizon contingent rewards reliably narrow cognitive focus to the known task. They produce more of what you already know how to measure. They are the opposite of the cognitive state that produces non-obvious solutions, novel combinations, or new businesses. The conditions under which people produce creative work are nearly the inverse of the conditions Bill Brown and Mike Doustdar are now installing.
What you can expect, then, is the following sequence. Top performers — the people who actually have outside options — leave first, because they always do. Mid-tier performers stop telling the truth in meetings because volunteering bad news is now penalized. Risky bets quietly disappear from the portfolio because the people who would have made them have correctly calculated that the upside accrues to the company over a decade while the downside accrues to their performance review in eight weeks. Customer-facing employees become measurably worse at the parts of their job that do not show up on a scorecard but do show up in churn rates eighteen months later. R&D pipelines fill with incrementalism. And in three to five years, the same investors now cheering the ruthlessness will be asking why the company has no new products.
There is also the second-order issue, which is loyalty. Mike Doustdar reportedly told a Novo Nordisk all-hands that the company’s return-to-office mandate was justified by reference to Amazon and Tesla. An employee on that call said he was trying to sound like Elon Musk. This is being said about a Danish drugmaker, in a country with five weeks of statutory vacation, strong labor protections, and a national culture that explicitly values work-life balance and consensus decision-making. You cannot transplant Tesla’s culture into Copenhagen by force of will. What you can do is signal to every Danish employee with options that the implicit contract under which they joined the company has been unilaterally rewritten. Loyalty is not a renewable resource. Once burned, the next generation of recruits prices it into their offer or chooses somewhere else.
The Steelman, Briefly
There is a real problem buried inside the CEOs’ argument, and it is worth conceding directly because the worst version of this critique pretends otherwise.
Some of these companies — Nestlé in particular, by the Bloomberg account — really had drifted into a culture where individual targets were rarely enforced, bonus payouts were nearly automatic, and qualitative ratings could be massaged. When an A-player and a B-player receive the same review and the same compensation, the A-player updates their model of the company. They start looking. The B-player, sensibly, stops working harder than is required to clear the bar. The aggregate effect, sustained over years, is an organization that converges on the lowest acceptable standard of work.
That is a genuine failure mode and it deserves a real response. But the response is differentiated rewards, honest reviews, and the willingness to actually fire people who are not performing. Those are management activities. They do not require a press release. They do not require the CEO to start meetings by chanting his earnings targets. They do not require an analyst to be invited to spend a day with the CEO and conclude that he is “a f---ing leader.” The fact that these CEOs are not quietly tightening their performance management but are loudly performing ruthlessness on earnings calls — the phrase “performance culture” appearing six hundred and thirty-three times in S&P 500 filings last year, up from four hundred and sixty — tells you what the actual product is. The product is the announcement. The investors are the customer. The employees are the raw material.
Ruthless Is Not a Strategy. It Is a Brand.
The CEOs in the Bloomberg piece are not solving a strategic problem. They are managing a narrative for the people who set their compensation. The narrative is that the company is finally being run hard, that mediocrity is being stamped out, that the next quarter’s margin expansion is durable rather than borrowed from future R&D budgets, and — most importantly — that the CEO himself is the kind of leader who is willing to make hard calls. The narrative is the deliverable.
Spencer Silver was, in the only sense that has ever produced a Post-it Note, an unsatisfactory performer for years. He was working on something that did not have a target, did not have a deadline, did not have a customer, and did not have a forecast. In a Navratil-era 3M, he would have been managed out twice over before Art Fry ever sang in his choir. We do not know what the next Spencer Silver is currently failing to invent inside Nestlé or Unilever or Novo Nordisk. We will find out in roughly a decade, when the pipeline is dry and the same investor base is asking, with no apparent irony, why the company has not produced a real new product since the early twenties.
Ruthless is not a strategy. It is a brand. And brands, eventually, get audited.