The Leadership Perception Gap: When Executives Lose Touch With Their Teams

A few weeks ago, a story emerged that crystallized everything I’ve been observing about modern leadership. A senior manager at a global technology company burst into tears during a meeting—not because of a personal crisis, but because she’d spent months maintaining a facade of control while her world crumbled around her.

She’d been fighting fires and chasing one AI update after another, rewriting roadmaps every week as new tools arrived. That morning, she’d learned that restructuring would likely eliminate many of her team members’ roles. Minutes earlier, a direct report had asked her, “Am I going to have a job in six months?” By the time she joined the leadership session, the weight of pretending she had answers had become too much.

This story, shared in Harvard Business Review by researchers Eric Solomon and Anup Srivastava, isn’t an anomaly. It’s a symptom of a widening chasm between what leaders believe is happening in their organizations and what employees actually experience.

Welcome to the era of the leadership perception gap.

The AI Enthusiasm Delusion

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The disconnect has never been more measurable—or more alarming.

According to research published in November 2025 by Boston Consulting Group and Columbia Business School, 76% of executives believe their employees feel enthusiastic about AI adoption in their organizations. The reality? Only 31% of individual contributors express such enthusiasm.

That’s not a minor miscalculation. Leaders are more than two times off the mark.

“The view from the bottom up is less sunny,” note researchers Deborah Lovich, Stephan Meier, and Chenault Taylor in their analysis. This perception gap extends far beyond AI optimism. It reveals a fundamental breakdown in leadership awareness about what’s actually happening on the ground.

The implications are staggering. When executives make decisions based on a wildly inaccurate understanding of employee sentiment, they create policies that feel tone-deaf, implement changes that generate resistance, and wonder why their carefully crafted transformation initiatives keep failing.

The Policy Trap

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The perception gap manifests most obviously in the ongoing return-to-office debate. Most executives approach hybrid work the same way they approach other business challenges: set a policy, communicate expectations, and measure compliance. When policies don’t stick and results don’t materialize, they conclude that hybrid work “doesn’t work.”

But recent research from the Flex Index, analyzed by MIT Sloan Management Review, suggests executives are fixated on the wrong problem entirely.

“Leaders are treating hybrid work as a policy challenge. It’s not,” write researchers Brian Elliott, Nick Bloom, and Raj Choudhury. “It’s a leadership capability challenge.”

Their analysis of over 8,500 U.S. companies found that organizations excelling at flexible work share identical capabilities that have nothing to do with specific attendance policies. Instead, they’ve discovered that workplace transformation isn’t about where people work—it’s about how they work together to drive outcomes.

Meanwhile, CEOs keep returning from peer gatherings convinced that stricter office mandates will solve productivity concerns and cultural disconnection. They’ve heard anecdotes about disengaged employees not complying with return-to-office mandates. They’re ready to order stricter rules and punishments.

The pattern is familiar. And it’s completely missing the point.

Why the Gap Exists

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The leadership perception gap isn’t caused by bad intentions. It’s a structural problem rooted in how information flows—or doesn’t—through organizations.

First, there’s the sycophancy problem. The higher you climb in an organization, the more filtered your information becomes. People tell executives what they think executives want to hear. Gallup’s research reveals that only 16% of employees say their last conversation with their manager was “extremely meaningful.” That means 84% of manager-employee conversations are essentially performative—creating an elaborate information blackout that executives may not even recognize exists.

Second, there’s the experience gap. Senior leaders often genuinely enjoy changes that employees find threatening. AI might feel exciting when it automates your least favorite tasks, but terrifying when it threatens your entire role. Hybrid work might seem like an obvious benefit to executives with corner offices, but anxiety-inducing for employees worried about visibility and advancement.

Third, there’s the assumption of shared understanding. When executives say “AI adoption,” they often mean efficiency gains and competitive advantage. When employees hear “AI adoption,” they hear potential job displacement. Same words, entirely different emotional landscapes.

The Hidden Costs

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The perception gap doesn’t just create awkward moments in leadership meetings. It generates concrete organizational damage.

Consider what happens when leaders implement AI tools believing employees are enthusiastic. They under-invest in change management because they assume adoption will be eager and natural. They’re blindsided by resistance. They conclude employees are being difficult rather than recognizing their own failure to understand employee concerns.

Or consider return-to-office mandates implemented by executives who believe employees just need a “push” to rediscover the magic of office collaboration. When those mandates fail—and they’re failing across industries—leaders often respond by tightening enforcement rather than questioning their assumptions.

The manager who burst into tears in that leadership meeting wasn’t weak. She was trapped in an impossible situation: expected to project confidence about changes she didn’t understand, provide reassurance she couldn’t honestly give, and maintain a facade that was destroying her from within.

Research I’ve discussed in my previous work on surface acting confirms that this kind of emotional labor burns leaders out three times faster than authentic leadership. When the perception gap forces leaders to pretend they understand and support decisions they’re confused by, the human cost is enormous.

Bridging the Gap

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So how do we close the leadership perception gap? Based on my work with over 7,000 leaders and the emerging research on this phenomenon, several approaches prove effective:

Stop relying on filtered information. The data that reaches executive dashboards has typically passed through multiple layers of interpretation and, often, optimization for palatability. Leaders need mechanisms that bypass these filters. Anonymous employee surveys with credible confidentiality. Skip-level meetings that give employees direct access to senior leadership. Internal social platforms where authentic concerns can surface.

Measure perception gaps explicitly. Periodically ask executives to estimate employee sentiment on key initiatives, then compare those estimates to actual employee surveys. Making the gap visible is the first step toward addressing it. Organizations that track this metric often find the gap itself becomes a leading indicator of implementation challenges.

Create genuine consequences for prediction errors. When executives systematically overestimate employee enthusiasm, there should be structured reflection about why. Not punishment—that would just incentivize more optimistic filtering—but genuine curiosity about what’s causing the disconnect.

Prioritize listening over communicating. Most “communication” strategies are actually broadcast strategies: leaders developing messages and cascading them downward. The perception gap suggests organizations need to invest at least equally in upward communication—and not the sanitized kind that currently flows through normal channels.

Model authentic uncertainty. When senior leaders admit they don’t fully understand employee experiences, they create permission for more honest dialogue. This is uncomfortable. It feels like weakness. But research increasingly shows that appropriate vulnerability builds rather than undermines trust.

The Leadership Capability Challenge

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The researchers studying hybrid work success got it exactly right: this isn’t a policy challenge. It’s a leadership capability challenge.

Organizations that are thriving—not just surviving—through rapid change share a common characteristic. Their leaders have developed genuine connection to employee experience. Not because they’re naturally more empathetic, but because they’ve built systems and practices that keep them grounded in organizational reality.

They measure outcomes, not presence. They give teams autonomy along with accountability. They recognize that employees working from home, the office, or anywhere in between can deliver exceptional results when properly supported.

Most importantly, they’ve stopped assuming they understand what employees think and feel. They’ve developed the humility to ask, the patience to listen, and the courage to adjust when reality differs from expectation.

The leadership perception gap isn’t just a data point. It’s a warning signal. When leaders become disconnected from employee experience, everything that follows—strategy, implementation, culture—builds on a foundation of misunderstanding.

That manager who broke down crying wasn’t having a moment of weakness. She was experiencing the crushing weight of a perception gap that made her role impossible to sustain.

The question for every leader reading this: How confident are you that you actually understand what your employees are experiencing? And what would change if you discovered you were more than two times off the mark?

References

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• Lovich, D., Meier, S., & Taylor, C. (2025, November 26). “Leaders Assume Employees Are Excited About AI. They’re Wrong.” Harvard Business Review. Retrieved from https://hbr.org/2025/11/leaders-assume-employees-are-excited-about-ai-theyre-wrong (Accessed: December 1, 2025)
• Solomon, E., & Srivastava, A. (2025, November 26). “How to Lead When Things Feel Increasingly Out of Control.” Harvard Business Review. Retrieved from https://hbr.org/2025/11/how-to-lead-when-things-feel-increasingly-out-of-control (Accessed: December 1, 2025)
• Elliott, B., Bloom, N., & Choudhury, R. (2025, November 3). “Hybrid Work Is Not the Problem — Poor Leadership Is.” MIT Sloan Management Review. Retrieved from https://sloanreview.mit.edu/article/hybrid-work-is-not-the-problem-poor-leadership-is/ (Accessed: December 1, 2025)
• Gallup. (2025). State of the Global Workplace Report 2025. Retrieved from https://www.gallup.com/workplace/349484/state-of-the-global-workplace.aspx (Accessed: December 1, 2025)
• Gallup. (2023, May 29). “A Great Manager’s Most Important Habit.” Retrieved from https://www.gallup.com/workplace/505370/leader-manager-wellbeing-report.aspx (Accessed: December 1, 2025)