The Three Laws of Performance

1. Performance Correlates to How Situations Occur

How people perform correlates to how situations occur to them.

Performance is linked to perception. The First Law of Performance states that how individuals or groups perform is directly tied to how they perceive or experience a given situation. This "occurring" goes beyond simple perception; it's the reality that arises from one's perspective, including views of the past and future. It's not about objective facts, but how those facts land for a person.

The reality illusion. People often operate under the assumption that everyone sees a situation the same way, based on shared facts. However, the First Law reveals this as the "reality illusion." Our actions are driven by how the world occurs to us, not necessarily how it objectively is. This explains why different people facing the same facts can have vastly different responses and performance levels.

Occurrence drives action. When a situation occurs as impossible, people's actions will reflect resignation or resistance, leading to poor performance. When the occurring shifts – for example, from hostile to collaborative, or from futile to doable – actions naturally change from disengaged to proactive, from resigned to inspired. Altering the occurring is the leverage point for transforming performance.

2. Your Default Future Is Already Written

Although most people have never articulated what they really think will happen to them personally or organizationally, they live every moment as if it’s destined to come about.

Living into the future. Every person and organization has a "default future," an unarticulated sense of what is inevitably going to happen. This future is shaped by past experiences, expectations, fears, and predictions, and it exists at a gut level, influencing present actions. People live into this default future, often unaware that their actions are making it come true.

Past predicts future. The default future is essentially a projection of the past. If past experiences have been marked by conflict, struggle, or failure, the default future will likely reflect this, leading to actions that perpetuate the cycle. For example, workers who felt like "tools" in the past will act defensively, reinforcing management's negative perceptions.

Resistance is futile. Trying to fix problems or implement change initiatives often fails because the underlying default future remains unchallenged. People's actions, driven by this ingrained sense of what's coming, undermine even well-intentioned efforts. The default future is a powerful force that must be addressed directly to achieve breakthrough performance.

3. How Situations Occur Arises in Language

How a situation occurs arises in language.

Language shapes reality. The Second Law reveals that the way a situation occurs to us is inseparable from language. This includes not just spoken words, but also body language, tone, symbols, and all forms of communication. Language is the medium through which our perspective is formed and held.

The unsaid's power. Beyond what is explicitly said, there is the "unsaid but communicated," which includes assumptions, expectations, and emotions. Even more powerful is the "unsaid and communicated without awareness," which shapes what is possible or relevant to say and do. This hidden layer of language significantly influences how situations occur and limits our freedom.

Linguistic clutter. When the unsaid, especially the unaware unsaid, is filled with unresolved issues, complaints, and interpretations taken as facts, it creates "linguistic clutter." This clutter takes up mental space, preventing new possibilities from emerging and leaving people feeling "stuck." It's like a full closet with no room for anything new.

4. The Key to Performance Is Clearing Linguistic Clutter (Rackets)

Becoming aware of rackets, and taking responsibility for them, is one of the most important aspects in elevating performance.

Finding the hidden key. The key to unlocking performance lies not in fixing problems (looking under the light), but in addressing the hidden dynamics of occurrence, particularly the unsaid language that creates clutter. This requires exploring the "dark, unfamiliar, hidden places" within ourselves and our organizations.

Understanding rackets. A significant source of linguistic clutter is "rackets," which consist of a persistent complaint, a pattern of behavior, a hidden payoff (like being right or avoiding domination), and a cost (like loss of freedom or joy). Rackets operate below awareness, and their payoff keeps them going, perpetuating unproductive behavior.

Clearing the space. Making space for new possibilities requires moving the unsaid into the realm of the said. This involves articulating persistent complaints, identifying rackets, and bringing hidden issues into open discussion. Disclosing a racket diminishes its power, allowing individuals and groups to address the underlying issues and create room for new actions and futures.

5. Future-Based Language Transforms Occurrence

Future-based language transforms how situations occur to people.

Creating new realities. The Third Law introduces "future-based language" (also called generative language), which has the power to create new futures, not just describe existing ones. Unlike descriptive language, which is limited to predicting based on the past, generative language invents possibilities that didn't exist before.

Displacing the default. Generative language doesn't modify the default future; it replaces it entirely. By declaring a new future, individuals and groups create a possibility that displaces the one they were living into. This new, invented future then becomes the context that shapes how situations occur in the present.

Compelling action. An invented future, crafted through generative language, is not merely a dream or hope; it's a possibility to which people commit themselves. This commitment makes the future real in the present moment, compelling action and transforming how situations occur from difficult or impossible to vibrant and full of possibilities.

6. Rewrite the Future by Completing the Past and Declaring Anew

To complete means moving an incident from the default future to the past.

Blanking the canvas. Creating a new future requires emptying out the default future, like preparing a blank canvas for a new painting. This involves seeing that constraints are language-based, articulating and rejecting the default future, and most powerfully, completing issues from the past that live as "incompletions" in the default future.

Completing incompletions. Incompletions are unresolved issues from the past (resentments, regrets, broken agreements) that continue to color how situations occur in the present and clutter the default future. Completing them involves addressing what happened, taking responsibility for one's part, and taking necessary actions like apologizing or giving up a racket. This process moves the issue from the future to the past, freeing up space.

Declaring a new possibility. Once space is created, a new future can be declared using generative language. A declaration is a speech act that brings a possible future into existence. It's a future that inspires action, addresses the concerns of those involved, and feels real in the moment of speaking. This declared future, backed by commitment, replaces the default future and transforms occurrence.

7. Leaders Empower Others to Rewrite the Future (Corollaries)

Leaders have a say, and give others a say, in how situations occur.

Shaping occurrence. Leadership, viewed through the Three Laws, is about empowering others to rewrite and realize new futures. The First Leadership Corollary states that leaders influence how situations occur for others, often by including them as coauthors of the future, shifting perspectives from resignation to commitment.

Mastering conversation. The Second Leadership Corollary highlights that leaders master the conversational environment. Organizations are networks of conversations. Leaders ensure this environment has "blank space" by resolving incompletions and addressing rackets, and is grounded in "integrity" – honoring one's word to create workability and wholeness.

Listening for the future. The Third Leadership Corollary emphasizes that leaders listen for the future of their organization to arise. They create the space for generative conversations where a compelling future can emerge, incorporating stakeholders' concerns. When this future "clicks," leaders articulate it, becoming its embodiment and inspiring others to live into it.

8. Organizations Can Become Self-Led Global Citizens

Can a collective organism like an organization have a purpose, other than growth, and can it bring something into the world that didn’t exist before?

Beyond the psychopathic. Traditional corporations, focused narrowly on profit and externalizing costs, can exhibit psychopathic traits. Increasing global pressures ("global warming of organizations") demand a new model. Extending the "corporation as individual" analogy, organizations can evolve to become "Self-led," integrating profit with social responsibility and stakeholder well-being.

The organizational Self. A Self-led organization's "Self" is the collective essence arising from its people's integrity-infused, harmonized network of conversations. It's driven by a compelling future that inspires all stakeholders and fulfills their concerns. This Self emerges when leaders create the environment for it, manage the network of conversations with integrity, and actively engage with stakeholders.

Leading the evolution. Becoming Self-led requires leaders (who may not be at the top) to step forward, own the situation, and stand for the possibility of integrating profit and global citizenship. They manage the conversational environment, ensuring integrity and future-based communication, and listen for the organizational Self to emerge through collective dialogue and commitment.

9. Overturn Your Life Sentence to Lead Your Own Life

To be authentic is literally to be your own author . . . to discover your native energies and desires, and then find your way of acting on them.

The thrown life. Many people live a "thrown" life, caught up in circumstances rather than authoring their own path. This is often driven by a "life sentence" imposed early on, stemming from a moment of crisis where one decided "something is wrong here" and "something is wrong with me," creating a persona to compensate.

Persona vs. Self. The persona is the identity created to survive and make up for perceived flaws (e.g., studying hard to compensate for feeling "not smart enough"). While it can lead to success, it's
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Last updated: May 8, 2025