Culture Change: Why Organizations Keep Getting It Wrong (And What Actually Works)

22 December 2025 Reading Time: 3 minutes

In the latest installment of our Strategic Conversations Series, our Editor-in-Chief Mike Klein talks with expert Howard Krais about how culture is understood – and misunderstood – in the realm of organizational change.

My conversation with Howard Krais recently about organizational culture change crystallized something I’ve been wrestling with for years: most companies fundamentally misunderstand what culture is and how it actually changes.

The conversation started with Howard’s frustration about executives who think they can “just change the culture” with a snap of their fingers. As he put it, culture takes years to evolve—it’s not something you can manufacture in a head office and roll out like a new software system.

Five C’s of Culture

As we talked, I found myself articulating what I’m calling a “Five C’s” framework for understanding culture:

Climate – The institutional weather, the tone, the atmosphere. This is what people feel when they walk through the door each day.

Context – The background, the overall situation that frames everything else.

Commitments – What people have agreed to do, what’s expected of them, both stated and unstated.

Content and Processes – The nature of the work itself and how it gets done.

Conduct – The actual behaviors, interactions, and unwritten rules that govern how people really treat each other and get things done. This is culture in action—how people behave when no one is watching, how they actually communicate and collaborate beyond what any policy manual prescribes.

HR typically tries to change culture by manipulating commitments and expectations—tweaking performance management systems or incentive structures. But this ignores the other four layers entirely. 

You can have the right climate, context, commitments, and content, but if people’s actual conduct doesn’t align, everything else falls apart. And you certainly can’t change what a pharmaceutical sales rep experiences in their day-to-day work just by adjusting their performance metrics.

The Head Office Disconnect

Howard made a brilliant point about what he calls “the clever kids in the center” problem. In his time at GSK, he saw firsthand how the head office in Brentford operated like a magnet, pulling all attention and talent inward. 

When he went out to spend time with a sales rep in Gloucestershire, it was like visiting a different company entirely. The concerns, priorities, and daily realities were so disconnected that they barely spoke the same language.

Yet the head office kept making pronouncements about culture change as if they understood everyone’s reality. They didn’t, and they often still don’t.

The Real Path to Change

Here’s what actually works, according to both our experiences:

Start with deep listening.

Not surveys asking predetermined questions, but genuine inquiry into what drives people, what they believe, and why they do what they do. As Howard emphasizes, the number one reason to listen is to make better decisions.

Bring people with you. Yes, this takes more upfront time. But sustainable change that doesn’t require constant rework? That’s faster in the long run.

Howard shared a powerful example from a factory closure where leaders created space for honest conversation. Instead of resistance, they got employees asking: “How do we make best use of the next 18 months? How do we upskill ourselves?”

Create space for adult conversations. Even difficult topics—especially difficult topics—need to be discussable. When you treat people like grown-ups who can handle complexity and uncertainty, they respond accordingly.

Understand that culture is beliefs and values in action. Not the values on your poster, but the ones that actually drive daily behavior. These don’t change through mandate—they shift through practice, over time, as people come and go.

The AI Opportunity

We also explored how AI might accelerate this process. AI can analyze qualitative feedback faster and more thoroughly than humans, identify patterns across larger populations, and help leaders be more responsive to the questions people are actually asking.

But—and this is critical—AI can’t replace human judgment in prioritization and decision-making. The biggest shift we’re facing is from a world where knowledge workers do analysis and basic tasks to one where they’re primarily decision-makers. Culture needs to support that transition.

The Leadership Bottom Line

Ultimately, culture change comes down to leadership. Not leaders who say “my people are my greatest asset” without understanding what that means, but leaders who genuinely prioritize people, create space for difficult conversations, and treat their teams as adults.

One story Howard shared stuck with me: the CHRO at EY talking about “for us” rather than forever employment. As long as you’re with us—whether two months or twenty-two years—we’ll make it a good experience. That’s treating people like adults. That’s understanding that loyalty flows both ways or it flows neither way.

The irony is that executives want culture change to drive business results, but they’re often unwilling to invest the time to understand the culture they actually have. They want transformation without conversation, change without listening, new behaviors without understanding what makes people actually change.

You can’t get to the next level using the thinking that brought you to the current level. And you certainly can’t change culture from a head office that doesn’t understand what’s happening in Gloucestershire.

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Thanks to Howard Krais for a thought-provoking discussion that helped clarify these ideas.

Written by: Editor