1. Culture is‘how we do things here‘

Culture gives rise to consistent, observable patterns of behavior in organizations. This view highlights that behavioral patterns or “habits” are central to culture; it’s not just what people feel, think, or believe. This view also focuses attention on the forces that shape behavior in organizations and their critical importance in making culture change happen.

Implication: It’s not enough to focus just on changing values and attitudes – if behaviors don’t change, culture doesn’t change.

2. Culture acts as a control system – for better and worse

Culture promotes and reinforces ‘right’ thinking and behaving and sanctions ‘wrong’ thinking and behaving. Key in this view of culture is the idea of behavioral ‘norms’ that must be upheld and associated social sanctions imposed on those who don’t ‘stay within the lines.’ This view also focuses attention on how the evolution of the organization shaped the culture. That is, how have existing norms and values promoted the survival of the organization in the past? Critically, what happens when the organizational environment shifts dramatically due, for example, to technological developments, the rapid emergence of new competitors, or a global pandemic that closes offices and forces a mass shift to remote working?

Implication: Established cultures can become impediments to survival when organizations face substantial environmental changes.

3. Culture is powerfully shaped by incentives

The best predictor of what people will do in organizations is what they are incentivized to do. By incentives, we mean here the complete set of incentives — not just monetary rewards, but also non-monetary rewards such as how people get status, recognition and advancement — to which members of the organization are subject. So to understand an organization’s culture, it helps to focus on incentives and the behaviors they encourage and discourage.

Implication: Changes in incentives can powerfully influence behaviors and hence, over time, reshape culture.

4. Culture helps people ‘make sense’ of what is going on

Sense-making is defined as “a collaborative process of creating shared identity and understanding  of different individuals’ perspectives and varied interests.” Culture is more than just patterns of behavior; it’s also jointly-held beliefs and interpretations about ‘what is’ A crucial purpose of culture is to help orient its members to “reality” in ways that provide a basis for alignment of shared purpose and joint action.

Implication: The right changes in culture can better help people ‘make sense’ of emerging challenges and opportunities and so adapt more quickly.

5. Culture is an essential source of shared identity

Culture provides not only a shared view of ’what is’ but also of ‘why it is.’ Culture is about ‘the story’ of the organization and the values that reinforce the narrative. This view focuses attention on the importance of organizational values and the benefits of having people feel connected to and inspired by them. It also highlights the danger that attempts to change values can result in a loss of a sense of shared identity and connection to the organization.

Implication: Leaders considering developing a new set of values should weigh the benefits of having ‘better’ values against the potential costs of people experiencing a loss of connection to the past and diminution of the loyalty and engagement that flows from it.