I’ve been speaking with several leaders recently who are navigating a similar tension.
There has been significant investment in technology, particularly AI, with an expectation that it would unlock productivity and performance.
At the same time, many leaders are finding that the reality on the ground feels more complex. Teams are not necessarily performing better, change is harder to embed, and in some cases, leaders are feeling more stretched than ever.
What it reinforces is that the challenge organisations are facing is not primarily about technology capability, but about how leadership is being exercised in a rapidly changing environment.
The latest State of the Global Workplace 2026 report provides a useful lens on this.
Leadership, Not Technology, Is the Constraint
Despite the pace of AI adoption, most organisations are not yet seeing meaningful returns.
The report highlights that:
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95% of organisations have not seen measurable profit impact from AI, and
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89% of leaders report no improvement in productivity.
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Only a small proportion of employees believe that AI has fundamentally changed how work gets done.
This suggests that the issue is less about access to tools and more about how those tools are being introduced, supported, and integrated into the way people work. Technology can enable change, but it does not lead it. That responsibility still sits with leaders.
Engagement Is Declining at a Critical Time
At the same time, global employee engagement has dropped to 20%, which is the lowest level recorded since 2020.
Most employees are either not engaged or actively disengaged, and this has a material impact on performance.
Gallup estimates that low engagement is costing the global economy approximately $10 trillion in lost productivity.
Engagement is often discussed in cultural terms, but in this context, it is more useful to think of it as a measure of readiness. Organisations are asking people to adapt to new ways of working, adopt new technologies, and navigate ongoing uncertainty. When engagement is low, that readiness is also low, and transformation efforts become significantly harder to land.
Managers Are Under Increasing Pressure
One of the more important insights from the report is the shift in manager engagement.
Manager engagement has dropped by nine percentage points since 2022 and now sits at 22%.
Managers have traditionally been more engaged than their teams, often acting as a stabilising layer within organisations. That is no longer the case.
Many managers are now operating under increased pressure, with larger spans of control, higher expectations, and the added complexity of leading through technological change. In many cases, this is happening without a corresponding investment in capability or support.
This matters because managers play a disproportionate role in shaping the day-to-day experience of employees. When managers are stretched or disengaged, it has a direct impact on team performance, engagement, and the ability to execute change.
AI Adoption Is Being Driven – or Blocked – by Leaders
The report also makes it clear that the success of AI is closely tied to leadership behaviour. Employees are significantly more likely to see value in AI, and to use it effectively, when their manager actively supports its use.
However, relatively few employees report receiving that level of support. This creates a disconnect between organisational intent and employee experience. Technology may be implemented at scale, but without leadership alignment and active sponsorship, adoption remains uneven and its impact limited.
This reinforces a broader point: transformation is not achieved through rollout alone. It requires leaders who can translate change into meaningful action for their teams.
Wellbeing Is Improving, but Emotional Load Remains High
There are some positive signals in the data, with global wellbeing (measured as “thriving”) increasing slightly to 34%.
At the same time, levels of daily stress, anger, sadness, and loneliness remain elevated compared to pre-pandemic levels. Leaders are experiencing higher levels of negative daily emotions, even where their overall life evaluation is higher.
This highlights the often unseen emotional load of leadership. Leaders are not only responsible for outcomes, but also for navigating uncertainty, supporting their teams, and making decisions that can have significant impact on others. Over time, this can affect how they show up, the quality of their decision-making, and their capacity to lead effectively.
Uncertainty About the Future of Work Is Growing
The report also points to increasing uncertainty about the future of work. While job market optimism has improved slightly, it remains below pre-pandemic levels.
At the same time, a growing proportion of employees believe their roles may be impacted or replaced by AI in the coming years.
This creates an additional layer of complexity for leaders. They are not only managing performance and delivery, but also addressing concerns about job security, career pathways, and the relevance of skills in a changing landscape.
What This Means in Practice
Taken together, these findings point to a consistent theme.
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Organisations are trying to navigate significant change with leadership approaches that have not evolved at the same pace.
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Technology is advancing quickly.
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Expectations are increasing.
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The environment is more complex.
Yet many leaders are still being asked to operate without the clarity, capability, or support required to lead effectively in this context.
The organisations that will navigate this well are likely to be those that invest deliberately in leadership, not just systems and tools.
This includes:
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building capability at the manager level,
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creating alignment around how change is led, and
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recognising that performance is driven as much by human factors as it is by systems and tools.
Questions Worth Taking Back to Your Team
As you reflect on this, resist the urge to jump straight to solutions. Start with the questions that matter:
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If AI and technology are not yet delivering the productivity we expected, where is leadership – rather than capability – the real constraint?
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How equipped are our leaders to lead through the level of change, ambiguity, and expectation we are placing on them?
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If engagement is a measure of readiness, what is our current level of readiness for the future we are trying to create?
A Final Thought
These are the conversations I am increasingly having with leadership teams – helping them step back from the noise of tools, systems, and initiatives, and focus on what will shift performance.
If you’re seeing some of these patterns in your organisation, and if you’re looking to strengthen how your leaders are showing up and leading through this complexity, this is exactly the work I do.
I’m always open to a conversation.
