AUGUST 15, 2026

What Shapes Organizational Culture

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Organizational culture generally consists of shared assumptions, beliefs, values, expectations, and behavioral norms that develop within a group over time (Schein & Schein, 2017). These patterns help members understand what behavior is considered acceptable, expected, rewarded, or discouraged. Leaders influence these patterns through what they consistently pay attention to, how they respond to problems, how resources are distributed, what behaviors they model, and whom they reward or promote. Yet influencing culture is different from completely controlling it.

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In many cases, leaders inherit culture rather than create it. A newly appointed supervisor may enter a team with years of established traditions, relationships, conflicts, loyalties, and informal expectations. Likewise, a new executive may inherit organizational systems, policies, communication practices, and attitudes that developed long before their arrival. Deeply embedded cultural assumptions are often resistant to rapid change because organizational members have learned from previous experiences what they believe will actually occur regardless of what a new leader says (Schein & Schein, 2017). A leader may begin communicating new expectations immediately, but employees often wait to see whether those expectations are consistently reinforced before changing their behavior.

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Subcultures and Structure

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Organizations can also contain multiple subcultures. Martin and Siehl (1983) demonstrated that subcultures may support, coexist with, or challenge a dominant organizational culture. Different departments, shifts, professional groups, geographic locations, or work teams may therefore develop very different norms within the same organization. The culture experienced by executives may be significantly different from the culture experienced by employees working in a particular department or location. Consequently, a cultural problem occurring within one workgroup does not automatically demonstrate that the organization’s senior leader created or supports that behavior.

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Informal leaders also have substantial cultural influence. An organizational chart identifies who possesses formal authority, but it does not necessarily identify whom employees trust, respect, listen to, or imitate. A veteran employee with little positional authority may have considerable influence over coworkers. If that employee supports a supervisor’s expectations, those expectations may gain credibility. If the employee dismisses them, ridicules them, or encourages others to continue established practices, competing cultural signals are created. Employees then determine which messages they believe represent the way things are actually done.

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The Reciprocal Nature Of Culture Creation

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Followership research supports this more reciprocal understanding of organizational influence. Uhl-Bien et al. (2014) argued that followers should not be viewed merely as passive recipients of leadership. Followers participate in leadership processes and influence leaders, other followers, relationships, and organizational outcomes. Employees therefore contribute to culture through the behaviors they support, challenge, ignore, or reinforce. A coworker who helps another employee, challenges inappropriate conduct, participates in workplace gossip, resists a change initiative, or remains silent when someone is mistreated is participating in the cultural environment.

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Organizational systems can also create or reinforce cultural patterns independently of any single leader. Schneider et al. (2013) emphasized the importance of organizational policies, practices, procedures, rewards, and expectations in shaping employee behavior. For example, an organization may publicly promote teamwork while rewarding employees only for individual performance. It may encourage innovation while severely punishing unsuccessful experimentation, or claim to value employee input while requiring numerous levels of approval before employees can act. Employees eventually learn to pay attention not only to what leaders say but also to what the organization consistently reinforces.

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There are also organizational environments in which compliance is necessary. Law enforcement, healthcare, aviation, military organizations, emergency services, correctional institutions, transportation systems, and other highly regulated or safety-sensitive operations cannot always permit unlimited employee discretion. Requirements involving safety, legal mandates, emergency procedures, security, or operational coordination may require strict adherence to established practices. Compliance itself is therefore not necessarily evidence of a toxic culture. The more appropriate questions are whether the requirements serve a legitimate purpose, whether discretion is provided where appropriate, and whether employees are treated professionally and respectfully while those requirements are enforced.

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Recognizing these factors does not remove accountability from leaders. Leaders possess formal authority and often control resources, priorities, promotions, discipline, and organizational responses. Their actions can reinforce healthy cultural patterns or contribute to harmful ones. A leader who repeatedly ignores inappropriate behavior may eventually help normalize that behavior. There is therefore an important distinction between creating a cultural problem, inheriting a cultural problem, and knowingly allowing a cultural problem to continue. A leader may not be responsible for how a culture originally developed, but once the leader recognizes harmful patterns, the leader’s response becomes part of the cultural process.

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Be Careful of Attributing Culture to Just the Leader

Leadership research has also warned against attributing too much organizational success or failure to individual leaders. Meindl et al. (1985) described this tendency as the “romance of leadership,” in which observers assign leaders greater causal responsibility for organizational outcomes than may actually be warranted. When morale declines, turnover increases, or conflict develops, simply concluding that the organization has a “bad leader” may prevent a more complete examination of the systems, history, group dynamics, and informal influences contributing to the problem.  A more accurate statement, therefore, may be that leaders participate in, influence, reinforce, disrupt, and sometimes transform culture. Some leaders inherit productive cultures, while others inherit deeply dysfunctional ones. Some strengthen positive traditions, while others attempt to change behavioral patterns that existed long before they assumed responsibility.