Culture is a key element of a great organization. It is also one of the least understood priorities for a company. Culture impacts every aspect of a business, including decision making, employee communications, risk tolerance, go-to-market strategy, and more. With so many areas affected, changing a company’s culture is a challenging task.
Some executive teams understand the importance of proactively building culture, while others pay lip service to the idea without putting in the effort required. Often, the more companies tout their culture, the less employees align with it. In essence, it’s style over substance.
To get a clearer understanding of company culture in real time, the Harvard Business Review featured a cross-national (North America, Europe, and Asia) study conducted as part of the Elgar Encyclopedia of Leadership. The study was designed to examine how senior leaders define, express, and operationalize culture within their organization and how employees perceive these efforts.
“Through in-depth interviews, team conversations, workplace observation, and with access to employee engagement data and biannual survey tracking for indicators such as trust in leadership, psychological safety, communication transparency, we examined how culture is forged not in vision statements, but in meetings, moments, and everyday decisions.”
From this work, a consistent pattern was identified. Leaders view culture as a communication strategy. “They believe it lives in messaging—in the articulation of purpose, the rollout of values, the tone of internal campaigns.”
What this pattern fails to take into account is that culture is not affected by narratives. It changes when systems change. Leadership takes personal risks or company norms that are demonstrated, not just talking points. The survey sought to answer four questions:
- How do senior leaders define and measure cultural impact?
- What disconnects emerge between leadership intent and team experience?
- What behaviors signal authenticity—and which quietly erode it?
- And what does it actually take to build a culture that lasts?
The results were surprising. Culture needs to be understood. “It’s treated as branding, not behavior. As output, not infrastructure. And when that happens—even the most well-meaning efforts can erode the very trust they’re meant to build. Here’s what we learned.”
Putting values up on the wall is not culture. The intent may be positive, but if leadership behaviors don’t back the efforts, employees aren’t buying in. In fact, 72% of formal culture initiatives launched over the last two years resulted in no meaningful improvement in employee trust, engagement, or retention one year later. Employees perceived the efforts as surface-level.
Unsurprisingly, when executives changed how they led (running meetings, giving feedback, making decisions, etc.), trust scores went up on average by 26%, with or without a branding campaign. “As one executive told us, ‘We didn’t write our values—we reverse-engineered them from how we wanted to behave.” Another senior leader put it simply: “We didn’t announce a culture shift. We just started acting like it mattered.”
The intent of leadership is always there; everyone wants to create a great working environment. The challenge is not to treat culture as a project. The key to changing company culture is to impact the underlying operating systems, including communication practices, decision-making, and related power dynamics.
Employees may not bring it up, but they most certainly notice. Nearly six in ten mentioned senior leadership taking actions that contradict company values weekly. This undermines credibility and buy-in.
Values are easy to speak to…empathy, integrity, inclusion. They are much harder to uphold. And that is what employees are looking at. The study found that the strongest cultural signals are those that involve visible, personal risk. For example, enforcing values even when it means losing a top performer or distributing decision-making that used to sit only at the top.
Leadership shouldn’t assume silence is agreement. Silence can be a sign that employees are not comfortable sharing their concerns. According to the research, 69% of employees regularly withhold feedback or concerns from senior leadership due to fear and a perceived lack of efficacy. Employees don’t want to appear disloyal, and those who have brought up issues in the past said nothing had changed, so it wasn’t worth bringing up again.
Employees are only going to share their concerns if they feel safe. As the article notes, “Culture isn’t built by soliciting feedback—it’s built by how leaders respond when that feedback is hard to hear.” Building an aligned culture begins by understanding that employees aren’t going to volunteer complex issues until they know there won’t be ramifications, and leadership shows they value it.
When leadership hears feedback from employees that raises questions about the culture, the quick fix is often to provide perks such as free lunches, recharge days, wellness benefits, and the like. However, the perks won’t make a difference if operational improvements aren’t implemented.
Interestingly, “organizations that removed surface-level perks and reinvested in structural improvements—such as manager coaching, conflict resolution, and clearer work boundaries—saw real gains. Burnout scores dropped by 22%, and perceptions of fairness and leadership care increased significantly.”
Changing company culture happens when leadership eliminates things that waste employees’ time, drain their energy, and confuse their priorities. It doesn’t change with platitudes and perks.
Culture starts at the top. Executive teams have to embrace and demonstrate the behaviors they are asking employees to model. They can’t simply announce the initiative and then leave it to middle management to implement the program. “When executives treat culture as something to delegate instead of something to live, they create confusion, cynicism, and load-bearing strain in the middle.”
If executive teams aren’t leading by example, the culture changes won’t happen. Expecting middle managers to enforce values that executives disregard is a recipe for failure. “Culture doesn’t fail because employees don’t care, it fails because power doesn’t shift. Leaders talk about trust but make decisions in back rooms. They champion inclusion but reward conformity. They promote empathy but penalize dissent. These aren’t communications problems. They’re credibility problems.”
The research found that changing company culture requires leadership to change first and is informed by three elements that must shift.
- Power: Who makes decisions, and who gets heard
- Risk: What leaders are willing to lose to live their values
- Modeling: What behaviors get demonstrated—not just demanded
For company culture change to be successful the article suggests asking, “What are we asking people to believe that we haven’t yet proven through our own behavior? Lead that first. Then name it. If you want your values to land, start by leading in a way that makes them real.”
For additional examples of changing company culture in your organization we recommend reading the full article at hbr.org. And for more insight into building a strong company culture, visit our blog or reach out to one of our executive search consultants.