How leaders can master the art of culture change

Understanding organisational culture is essential when trying to make change a success and driving business performance.

In brief

• Identifying the values, behaviours and beliefs that are unique to your organisation’s culture is key when initiating change.
• By adopting a multi-faceted approach to culture, leaders can develop effective change management strategies.
• Organisational culture can be leveraged as a tool to drive performance.

Organisational culture has an undeniable impact on performance. Yet, despite decades of academic research exploring the topic, many business leaders remain baffled by what it is, what it does and how to change it. This report draws on a range of psychological and occupational research on organisational culture to present a clear view that leaders can understand, adapt and execute in their own organisation.

Understanding organisational culture

Organisational culture can be a complex concept, it best understood as being comprised of three parts: a social phenomenon, a multi-layered experience and comprised of both an overarching unified culture and subcultures.

• Culture, as a dynamic social phenomenon: By this we mean that an organisation’s culture is engineered by its people. It constantly evolves, as employees interact with each other, and they make sense of these interactions. As such we take the perspective that culture is not just a fixed, clearly defined entity that is obtained upon joining an organisation. Rather, it is intricate and is only made more complex by its fluidity.
• A multi-layered experience: In line with the organisational culture literature, we also take the perspective that organisational culture is multi-layered.1 There are elements of a company’s culture that are explicit, such as what is formally articulated and the parts of the culture that are experienced on a day-to-day basis. There is also the implicit, shadow side or culture known as a 'deep culture' which is comprised of the unquestioned suppositions and beliefs that steer the culture that is lived. 
• Comprised of many subcultures: An organisation may have a dominant culture. One that is overarching or shared across various business units and typically based around embedded or core values. However, differences such as department or function and geographic location gives rise to smaller subcultures. Whilst it can be helpful to have a shared culture across an organisation to unify your people around core values, these diverse subcultures can be highly beneficial to an organisation. For example, our research posits that a major benefit of having subcultures is that they enable the flexibility for hubs across the organisation to promote innovation.

In understanding organisational culture as a fluid social phenomenon — determined by the salient values, behaviours and beliefs which mould people’s experience within a company — you will be in the best position to identify how you can improve and change your company’s unique culture.