Why You're Thinking About Culture All Wrong

Most organizations treat culture as a set of values. That's partially necessary and not close to sufficient. Clayton Christensen's culture formula — priorities, resources, processes, policies, guiding principles — is far more useful.

Scott EnglerSync Executive Partners · 2025-11-26

Most organizations look at culture as a set of values — values are behavioral priorities. Partially necessary. Not even close to sufficient.

Clayton Christensen articulated a culture formula that is far more useful. Notice how this looks far different than a set of values: Priorities > Resources > Processes (formal and informal/values).

Here's a different way to think about culture: Priorities, resources, formal processes, policies, guiding principles.

The Five Elements of Culture That Actually Work

1. Priorities

Your culture starts with your priorities — and priorities aren't values. Priorities are the choices the organization makes when it cannot do everything. What wins when there's a trade-off? What gets attention, budget, and talent? What do leaders reward? What determines speed versus rigor? What gets escalated versus delegated? These are your real priorities — and they define your real culture.

2. Resources

Your culture is enabled by aligned resources: people, dollars, technology. If an organization says innovation matters but puts its best people and most dollars on maintenance of the legacy business — that is the culture. Not innovative. Resources reveal the truth that priorities sometimes obscure.

3. Processes and Systems

Your processes bring culture to life. It's the way you do things — your business processes, talent processes, and systems including compensation all need to be aligned to your priorities and resources. Christensen calls these "formal processes." If you want collaboration but incentivize individual achievement with no collaboration component, your culture will not be collaborative. The system overrides the aspiration every time.

4. Policies

Your policies need to be aligned to enable your priorities. Many times legacy policies are cultural drag. If the policy predates the strategy, it is probably constraining the culture you're trying to build.

5. Guiding Principles

Guiding principles help people make everyday decisions where there are no formal processes. Values don't tell people how to behave. Guiding principles tell people exactly how to behave when judgment is required. They say: "We do this, not that." If your culture is not explicit enough to help people make the right decisions when there's no oversight or process, it's not useful.

The Bottom LineCulture is ultimately a force multiplier or detractor for the organization, but it requires you to make choices and operationalize those choices. It's far from soft. Fix the design — priorities, resources, processes, policies, principles — and the culture follows.

CultureOperating SystemsLeadershipPEOrganizational Design

Frequently asked questions

What distinguishes high-performing CFOs in PE-backed companies?

High-performing CFOs in PE-backed companies are distinguished by three capabilities: the ability to build a single trusted fact base that CEO, CFO, and sponsor all operate from; the ability to translate financial complexity into a board narrative that drives decisions rather than just reports results; and the ability to anticipate events — capital raises, compliance crises, leadership gaps — before they become reactive situations.

How should a PE-backed company prepare its finance function for a hold period?

In the first 90 days of a hold period, the finance function should establish a clean close cadence, build a reporting package that meets board and sponsor expectations, identify the key financial risks in the investment thesis, and assess whether the current team has the capability to carry the value creation agenda through to exit. Gaps identified early are fixable. Gaps identified at exit are expensive.