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Dream:
Dreams are important because they set the bar. Once you set that bar it anchors everything. You have to dream big. Dreams have to be stretched but credible. And you have to know about 80 percent how you're going to get there; the rest you can figure out along the way.

The dream has to inspire and align people. Companies are formed by people. This is obvious, but it can be easy to forget. If leaders work in harmony on that dream, the company goes forward. When company leaders don't work together, things stall.

Keep raising the bar; don't be afraid to dare and try harder. Be public about it. Make it measurable.

People:
Great companies are formed by great people. No one says, "I'm going to hire average people," but what you say and what you do aren't always the same. Great people are the ones who, when given the right training and opportunities, will get better than the managers who hired them. If you're afraid of hiring people better than you, you're not a very good executive. The benefit of hiring great performers is that those people will force you to get better, too.

Great people attract other great people. Conversely, mediocre people like to work together because it's easier. Great people like a meritocracy; they like to know what their future opportunities are. Put pressure on your team. Good teams perform best under pressure.

You have to be the coach and spend time with people. It's not HR's role. Imagine if a sports coach didn't coach and train his team. He'd be fired. Don't say your agenda's too busy. Make time for people.

One of the few sustainable competitive advantages an organization has is its people. If you hire and train right, competitors can't duplicate it.

Culture:
Create a culture of ownership. If I'm an owner, failure is not an option.
Think about rental cars. People treat them differently than their own car. You don't want that attitude in your company by hiring job hoppers. You want people who think long term and who feel a sense of ownership in the organization.

Show that you value great employees' contributions by training and promoting people from within.

For details on the principals that support these three elements of a performance culture, see "Dream, People, Culture: 10 Principals."