What Is Organisational Culture? Understanding the Unwritten Rules of Success

What really is culture in an organisation? We have so many theories, definitions and explanations that a fairly straightforward idea has become unnecessarily complicated. We talk about values, leadership, communication, purpose and behaviour, often as though each one explains the whole thing.

But if we want to understand how culture drives results, and how cultural change happens, we need to look beneath those visible features. We need to ask a more fundamental question: what do people in this system assume will make them successful?

That is the starting point. Culture is the set of assumptions, or unwritten rules of success, through which individuals, organisations and groups respond to their environment. Those assumptions influence how people organise themselves, solve problems and pursue results.

Once we understand that relationship, culture becomes less mysterious. More importantly, we can begin to distinguish between changing the appearance of an organisation and changing what actually drives it.

Key Takeaways

• Organisational culture is driven by unwritten assumptions about what makes individuals, teams and organisations successful.

• Culture emerges through interactions between the external environment, the organisation, individuals and groups.

• Changing visible behaviour without examining its underlying assumptions can leave cultural causes untouched.

• Cultural change begins by making assumptions explicit and connecting them to actions and results.

A Simple Systemic Model of Organisational Culture

An organisation does not exist in isolation. Neither does an individual. Both operate within an external environment, interpret what that environment means and organise their actions around the results they believe are possible.

We can understand this as a system with four interacting elements:

• The external environment: the conditions that establish the context.

• The individual: the person interpreting that context through personal experience, beliefs and aspirations.

• The organisation: the system translating its interpretation into goals, strategies, structures and policies.

• Groups and teams: the arrangements through which individuals and the organisation work towards results.

Results are the common binding factor. The organisation wants to achieve something. The individual wants to achieve something. Groups are formed to produce something. All of this happens within a context that presents opportunities and constraints.

Culture is not simply one of these elements. It emerges through their interaction, driven by the assumptions each brings to the system.

The external environment creates a context

The external environment contains what we might call dynamic complexities. Government policies, market opportunities, the state of the economy, population and geography can all influence what an organisation or individual considers possible.

But the environment does not hand every organisation an identical strategy. Different organisations can encounter the same conditions and arrive at different goals.

Why? Because they interpret those conditions differently. Each makes assumptions about what the context means, which opportunities matter and how success might be achieved. The context matters, but so does the meaning we assign to it.

The individual internalises that context

An individual interprets the environment through upbringing, education, values, beliefs and personal circumstances. From that interpretation come ideas about what they can do, what they cannot do and what they might become.

Then the person enters an organisation with its own interpretation of the world. Personal aspirations meet organisational goals. The individual must work out how to solve problems, contribute and pursue success within that setting.

This is where assumptions become particularly important. What does the individual believe will help their career? What do they think they are permitted to contribute? How do they believe they must behave to succeed?

The organisation turns assumptions into arrangements

The organisation also interprets the external environment. It identifies opportunities, chooses goals and develops strategies to pursue them.

Those choices are then expressed through structures, policies, reward systems, appraisals and performance evaluations. These are the formal arrangements intended to move people towards a result.

Yet those arrangements are not independent of assumptions. They reflect beliefs about the environment, about people and about how work should be organised. The formal system is therefore part of the cultural picture, but it does not explain the whole picture on its own.

Groups bring the system together

Individuals and organisations organise themselves into groups and teams to achieve results. At this level, personal assumptions meet organisational assumptions in everyday work.

The question becomes not only “How do I succeed?” but also “How do we use our collective effort to succeed?” What people believe about that question shapes how they work together.

Culture Is the Unwritten Rule, Not Just the Written Value

We often describe organisational culture by pointing to stated values, purpose, goals or strategy. These things are visible. We can read them, discuss them and explain them.

But they are not, by themselves, the culture.

If culture were simply the values an organisation had written down, changing it would be straightforward. We could change the wording, announce the new values and consider the work complete.

The difficulty is that people operate through assumptions that may never have been written down at all. These are the unwritten rules about what actually leads to success.

For an individual, the question is: “What must I do to succeed here?” For the organisation, it is: “What must we do to succeed in this environment?” For a group, it is: “How must we work together to produce the required result?”

Culture sits in the answers people take for granted. Those answers shape how the formal organisation is understood and used.

This does not mean values, strategies or structures are irrelevant. It means we need to examine the assumptions beneath them rather than mistake the visible expression for the underlying driver.

Why Assumptions Matter So Much

An assumption can feel completely true to the person holding it. That does not make it an accurate account of reality.

We may hold a strong belief about what we can contribute, how far our career can go or what the organisation needs to do. The strength of that belief does not establish whether it will produce the result we want.

Some assumptions help us succeed. Others do not. The important point is that they are influencing our choices whether or not we recognise them.

An organisation makes assumptions about its external context. Individuals make assumptions about that same context, but also about the organisation and the assumptions already embedded within it. Groups bring these interpretations together.

Consequently, organisational culture cannot be understood only by asking what senior leaders intend.

We also need to understand what individuals and teams believe success requires.

This is a systemic model because it connects those levels. It can also help us think about larger systems, including a nation. Individuals, the state and groups make assumptions about their environment, develop aspirations and create policies or arrangements to pursue results. The scale changes, but the underlying relationship remains recognisable.

Why Change Efforts Often Address Effects Rather Than Causes

Usually, an organisation starts talking about change when a desired result is not appearing. Performance falls short. A team is not delivering. Something visible tells the organisation that there is a problem.

That is understandable. Results are what the system is trying to produce, so a gap in results attracts attention.

The trouble begins when we move too quickly from the result to a convenient explanation:

• The group is struggling, so it must have a relationship problem.

• An individual is not delivering, so it must be a leadership issue.

• The organisation is not achieving its goals, so communication must be the problem.

Relationships, leadership and communication may all deserve attention. But selecting one of them does not mean we have understood the cultural cause.

We may simply have identified a visible part of the effect. If we intervene there without examining the assumptions behind it, we are working with an incomplete picture.

A visible problem tells us where to investigate. It does not automatically tell us what is causing it.

This helps explain why change can feel uncertain. An intervention may touch something important, or it may leave the underlying driver untouched. The organisation changes an activity, arrangement or behaviour while the same unwritten rules continue to operate.

Are People Resisting Change, or Are We Missing the Rules?

When a change effort does not produce the expected result, we often add another explanation: people resist change. We conclude that change is difficult, unclear or inherently unpredictable.

But have we actually understood what is driving the current behaviour?

If we have not examined the assumptions, we may be placing new assumptions on top of old ones. We assume people are resistant without understanding what they believe they must do to succeed.

From their perspective, their behaviour may be entirely consistent with the unwritten rules of the organisation. Asking them to behave differently does not automatically change those rules.

The more useful question is therefore not simply “How do we make people change?” It is: “What assumptions make the current way of working seem necessary?”

That question shifts our attention from blaming a person or a team to understanding the system. It also makes the change conversation more precise. Instead of discussing resistance in general terms, we can examine the particular beliefs guiding action.

The CC Culture: A Simple Example of the Deeper Problem

Consider an organisation where employees routinely copy their boss into emails. People may describe this as a “CC culture” and decide that the behaviour needs to stop.

The visible action is easy to identify: the boss appears in the CC field. A straightforward response might be to introduce a policy telling people not to do it.

But what assumption is the individual making?

Perhaps the unwritten rule is: “If my boss is not happy, I will not succeed.”

Now the behaviour becomes understandable. Copying the boss is not merely an email habit. It is connected to the individual’s belief about success in the organisation.

A rule against unnecessary copying addresses the action. It does not, by itself, address the belief driving that action.

The cultural question is why the individual believes keeping the boss happy is necessary for success, and how that belief relates to the wider organisational system. Until we understand and deal with that assumption, we have not reached the root of the issue.

This is the distinction between managing a visible behaviour and understanding culture. The behaviour is the entry point. The assumption is what we need to investigate.

How to Approach Cultural Change at the Root

A systemic approach to cultural change begins with a clear question: what have we assumed about how to succeed in this environment?

That question needs to be explored across the organisation, the individual and the group, rather than confined to whichever area first displayed the problem.

1. Clarify the result and the context

What result are we trying to achieve? What is happening in the external environment? What opportunities or constraints have we identified?

Keep the context distinct from the interpretation. The conditions we face and our assumptions about those conditions are related, but they are not the same thing.

2. Examine organisational assumptions

What beliefs sit beneath the goals, strategies, structures, policies and reward systems? What has the organisation assumed about how people and work should be organised to produce success?

This brings attention to the reasoning beneath the formal arrangements, not just the arrangements themselves.

3. Understand individual and group assumptions

What do individuals believe they must do to succeed? What do they think they can contribute? How do teams believe they need to work together?

These questions help reveal the unwritten rules operating within different parts of the system.

4. Connect the assumptions to behaviour and results

Once the assumptions are visible, examine how they influence action. Which behaviours become understandable in light of those beliefs? How do those behaviours relate to the results being produced?

The purpose is not to collect opinions in isolation. It is to understand the relationship between context, assumptions, action and outcomes.

Make the Unwritten Rules Visible

Culture does not need to remain a vague explanation for everything that happens in an organisation. We can understand it as a dynamic interaction between the external environment, the organisation, individuals and groups, driven by assumptions about success.

The practical challenge is to make those assumptions explicit and examine them openly. Without that work, we may not fully understand the culture we are trying to change.

With it, the task becomes much clearer. We stop treating every visible symptom as a separate problem and begin addressing the reasoning beneath it.

Before changing another policy, structure or behaviour, ask what unwritten rule makes the current approach seem necessary. That is where a more useful, and much less mysterious, conversation about cultural change begins.