Episode 34: What to Do When Loyalty Becomes a Performance Issue

Episode 9 in the series, The Founder’s Blind Spot

Loyalty is valuable. Loyal employees bring stability, wisdom, and a steady presence that anchors your business. But here’s the blind spot: when loyalty is rewarded more than performance, growth begins to stall.

Founders often defend underperformers with phrases like, “He’s been with me since the beginning,” or “She’s part of the family.” And while loyalty matters, it cannot be a free pass. When new ideas are ignored in favor of “the way it’s always been,” innovation goes silent. And when innovation goes silent, your best people quietly leave.

In this episode, James breaks down the difference between good loyalty—the kind that strengthens culture and carries performance—and problematic loyalty, where tenure shields underperformance.

This episode is for founders who:

Are struggling with the tension between loyalty and performance and want to protect culture without stalling growth.

What you’ll take away:

• Loyalty paired with performance is priceless.
• Loyalty without performance erodes trust and sets a lower standard.
• Tenure is not the same as loyalty: some prove loyalty daily, others coast on years of service.
• Rewarding loyalty over results slowly drives out your top performers.

• Who in your company represents good loyalty — people who’ve been around and are still raising the bar?
• Where might you be protecting someone under the banner of loyalty, even though performance is slipping?
• What would change if loyalty was honored, but never separated from results?

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