The Performance Arbitrage: Why Creativity Is the Only Scalable Human Advantage in the Age of AI Blog Post
TL;DR
AI scales efficiency, not performance.
Creativity is the only remaining human advantage that compounds at scale.
Growth-stage companies that fail to invest in “Small C” creativity will automate themselves into mediocrity.
Why AI-Driven Efficiency Is Not the Same as Performance
I have spent my career in the rooms where growth happens, as an operator, a founder, and an advisor to CEOs. In those rooms, the conversation right now is dominated by one thing: AI-driven efficiency. The prevailing assumption is that if we can automate the formulaic, we can cut the headcount and scale the output.
But here is what I know: Efficiency is not performance, and scaling work is not the same as scaling a company.
We are currently witnessing a massive tactical error in leadership. CEOs are treating AI as a replacement for human effort rather than a multiplier of human judgment. In doing so, they are inadvertently stripping their organizations of the one thing AI cannot replicate: the ability to see a better way when there is no playbook to follow.
This is why I believe "Big Little Breakthroughs" by Josh Linkner should be required reading for every executive leading a growth-stage company today. It provides the framework for the only sustainable competitive advantage left in a world where "process" has become a commodity.
The 77% Reality: Why “Small C” Creativity Drives Economic Growth
The word "creativity" often makes operators nervous. It sounds like art, or radical, transformative innovation that requires a lab and a decade of R&D. But for the growth-stage leader managing 30 to 300 employees, that isn't the creativity that drives the P&L.
We need to focus on "Small C" creativity—the everyday innovations and tiny pivots that happen at the front lines of execution. According to Harvard University research cited by Linkner, 77% of economic growth is attributed to these small creative advances, not radical innovations.
Most companies are leaking margin because their people are waiting for permission to innovate or, worse, have been trained to be "playbook thinkers" who cannot optimize beyond the system. I’ve realized that the core challenge of AI transformation is creative. If your team only does what the playbook says, they are essentially acting as a manual version of an AI agent, but one that is slower and more expensive than the digital alternative.
AI Scales the System You Already Have, Including the Dysfunction
A core principle we hold at LoyaltyOps is that AI accelerates whatever system it is given. If you give AI a team of uninspired process-followers, it will only amplify your inconsistency at scale.
Technology magnifies the performance system that already exists, good or bad. If your organization relies on "individual heroics" to get things across the finish line, AI will not fix that; it will simply make the heroics more frequent and the burnout more rapid.
The real opportunity for leaders is to move their people from being "doers" of tasks to "architects" of performance. This requires a shift in how we value human time. In an AI-saturated market, human creativity is the steering wheel, while AI is the engine. Speed without the human ability to pivot and problem-solve only gets you to the wrong destination faster.
Why Scaling Feels Heavy for Growth-Stage Leaders
For many CEOs of organizations with 30+ employees, growth doesn't feel like a win right now. It feels like "performance drag". You have good people who care, yet execution is uneven, decisions move slowly, and the same problems repeat quarter after quarter.
This "heaviness" occurs because the organization has outgrown its informal habits, but hasn't yet installed the performance infrastructure that supports "Small C" creativity. Leaders end up carrying all the clarity themselves, acting as the "human glue" that holds the business together.
When you empower your team with creativity skills, specifically the habits Linkner outlines in his book, you are installing a self-correcting mechanism into your teams. Instead of escalating every bottleneck to the CEO, creative teams find the "Big Little Breakthrough" that resolves the friction at the source.
From Playbook Thinkers to Innovation Drivers: The Leadership Shift Required
We want people to follow process, but we don't want them to be playbook thinkers. As Claire Hughes Johnson describes in “Scaling People”, a playbook thinker hits a wall and waits for a manager to tell them how to climb over it. An innovation driver is someone who has mastered the muscle of creativity and looks for the small pivot that makes the wall irrelevant.
To drive this shift, leaders must embrace habits that drive execution - Boldness and Determination:
Boldness: Replace "I think" with "Here is what I know" by using facts and evidence to challenge complacency. Challenge your team to find three solutions for every one problem they bring to you.
Determination: Focus on "pedals over podium"—the small, daily rotations of progress. Creative breakthroughs aren't lightning bolts; they are the result of disciplined resilience and micro-steps executed daily.
When you invest in the creativity of your people, you are building an empire of integrity that elevates others long after you’ve left the room. This is how you build a legacy—by being the calmest person in the room who empowers others to see their own potential.
The Mandate for Growth-Stage CEOs in the Age of AI
The cost of doing nothing is that your organization will stay in the "reactive zone," where growth depends on heroics and individual energy. AI will continue to accelerate, and if your people aren't equipped to innovate beyond the playbook, they will be left behind.
Read Linkner’s book, but don't just read it for yourself, read it for your crew. Treat creativity not as a "soft skill" for the marketing department, but as a core component of organizational performance.
My conviction is this: AI can scale work. Only people can scale performance.
By focusing on "Small C" creativity, you turn your people into your most scalable growth advantage. You move from firefighting to focus, and from effort to execution.
In the hard middle of growth, structure is the container people crave, but creativity is the fuel that makes that structure move. Stop trying to out-process the machines. Start investing in the one thing they can't replicate: the human ability to see a better way.
If you are navigating AI adoption and feeling more operational drag instead of momentum, this is a leadership problem, not a tooling problem. That is the work we help organizations solve.
Recommended Reading from the LoyaltyOps Leadership Library
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