5.3 Creating a Project Culture

Learning Objectives

  1. Describe how project culture is developed and enforced.
  2. Describe how differences in culture between stakeholders can influence the project.
  3. Describe the role of innovation on projects.

Project managers have a unique opportunity during the start-up of a project. They create a project culture, something organizational managers seldom have a chance to do. In most organizations, the corporate or organizational culture has developed over the life of the organization, and people associated with the organization understand what is valued, what has status, and what behaviors are expected. Edgar Schein defined culture as a pattern of basic assumptions formed by a group on how to perceive and address problems associated with both internal adaptation and external integration (Schein, 1990). Schein also described organizational culture as an abstract concept that constrains, stabilizes, and provides structure to the organization. At the same time, culture is being constantly enacted, created, and shaped by leadership behavior.

Characteristics of Project Culture

A project culture represents the shared norms, beliefs, values, and assumptions of the project team. Understanding the unique aspects of a project culture and developing an appropriate culture to match the complexity profile of the project are important project management abilities.

Culture is developed through the communication of

  • the priority
  • the given status
  • the alignment of official and operational rules

Official rules are the rules that are stated, and operational rules are the rules that are enforced. Project managers who align official and operational rules are more effective in developing a clear and strong project culture because the project rules are among the first aspects of the project culture to which team members are exposed when assigned to the project.

Operational Rules on a Project in India

During the start-up of a project in India, members of the project team were given a policy that stated all travel expense claims must be submitted within three days of completion of travel. During the first few weeks, the administrative team began to understand that this was a difficult policy to enforce without creating morale problems on the project. Instead of changing the official rule, it was seldom enforced. The official rules and operational rules differed.

Later on in the project, a worker was injured after crossing an area that was marked as unsafe. Workers indicated that they knew the official rules but it took too much time to go around the unsafe area. They assumed that official rules could be ignored if they were difficult to obey. The difference between official rules and operational rules of the project created a culture that made communication of the priorities more difficult.

In addition to official and operational rules, the project leadership communicates what is important by the use of symbols, storytelling, rituals, rewards or punishments, and taboos.

Creating a Culture of Safety

A project manager in South America who wanted to create a strong safety culture on a construction project with significant safety concerns used several methods to create the desired culture. In the first meeting that project team members attended upon joining the project was a safety orientation. Members were issued a card—a symbol—after the meeting granting permission to participate on the project. The project leadership team told stories of previous projects where people were fired for breaking safety rules and often warned that the fastest way to get fired on the project was to break a safety rule—an example of storytelling. Every project meeting started with a discussion of a safety topic—a ritual—and any discussion of lessening the safety rules was forbidden—taboo—and was quickly and strongly cut off by the project leadership if it occurred.

Culture guides behavior and communicates what is important and is useful for establishing priorities. On projects that have a strong safety culture, team members feel free to challenge anyone who breaks a safety rule, even managers. The safety aspects of culture are stronger than the cultural aspects of the power of management.

Culture of Stakeholders

When project stakeholders do not share a common culture, project management must adapt its organizations and work processes to cope with cultural differences. The following are three major aspects of cultural difference that can affect a project:

  1. Communications
  2. Negotiations
  3. Decision making

Communication is perhaps the most visible manifestation of culture. Project managers encounter cultural differences in communication in language, context, and candor. Language is clearly the highest barrier to communication. When project stakeholders do not share the same language, communication slows down and is often filtered to share only information that is deemed critical. The barrier to communication can influence project execution where quick and accurate exchange of ideas and information is critical.

The interpretation of information reflects the extent that context and candor influence cultural expressions of ideas and understanding of information. In some cultures, an affirmative answer to a question does not always mean yes. The cultural influence can create confusion on a project where project stakeholders share more than one culture.

Culture Affects Communication in Mumbai

A project management consultant from the United States was asked to evaluate the effectiveness of a U.S. project management team executing a project in Mumbai, India. The project team reported that the project was on schedule and within budget. After a project review meeting where each of the engineering leads reported that the design of the project was on schedule, the consultant began informal discussions with individual engineers and began to discover that several critical aspects of the project were behind schedule, and without a mitigating strategy, the project would miss a critical window in the weather between monsoon seasons. The information on the project flowed through a cultural expectation to provide positive information. The project was eventually cancelled by the U.S.-based corporation when the market and political risks increased.

Not all cultural differences are related to international projects. Corporate cultures and even regional differences can create cultural confusion on a project.

Cultural Differences between American Regions

On a major project in South America that included project team leaders from seven different countries, the greatest cultural difference that affected the project communication was between two project leaders from the United States. Two team members—one from New Orleans and one from Brooklyn—had more difficulty communicating than team members from Lebanon and Australia.

Innovation on Projects

The requirement of innovation on projects is influenced by the nature of the project. Some projects are chartered to develop a solution to a problem, and innovation is a central ingredient of project success. A project to develop a vaccine in response to a recent flu outbreak is an example of a project where innovation is important to achieving the purpose of the project.

Innovation is also important to developing methods of lowering costs or shortening the schedule. Traditional project management thinking provides a trade-off between cost, quality, and schedule. A project sponsor can typically shorten the project schedule with an investment of more money or a lowering of quality. Finding innovative solutions can sometimes lower costs while also saving time and maintaining the quality.

Innovation on a Steel Plant Project

On a project to design and build a plant to make steel using new technology, the project leadership was committed to generating cost savings on the project that would allow needed technical modifications later on during the project. The project was in the early design phase, and the project leadership established a goal for generating $1 million in cost saving suggestions. The goal was established in early fall, and the project manager declared that he would swim the lake on the day of the project review in February if the project met its goal.

A process was established to track cost saving ideas using highly visible green paper for documenting ideas, and a chart was placed on the project communication wall recognizing people and teams that submitted ideas. Each team was allocated a specific cost savings goal, and a team lunch was provided when the goals were met. The project manager created a balance between the message that this is a serious goal and that the project will have some fun with the process.

On one occasion, the project manager talked with the electrical engineering lead to understand why no suggestions were emerging from the electrical design team. The electrical design team was struggling to maintain the project schedule and did not have time to focus on project contests. The project manager emphasized that the project had several goals, and generating the cost savings for the client was an important project goal.

The electrical engineering lead gathered some senior electrical engineers into a small conference room, and for the next three hours, this impromptu team reviewed electrical drawings and concepts and began to generate ideas on how to accomplish the design specifications and cut costs. The electrical engineering lead maintained a flip chart in the front of the conference room, and as soon as the team found enough savings to meet the electrical target, the team disbanded and went back to working on the electrical design.

The team exceeded the goal prior to the February project review. The project manager swam the lake during an enjoyable project celebration.

Innovation is a creative process that requires both fun and focus. Fun reduces the amount of stress on the project. Stress is a biological reaction to perceived threats. Stress, at appropriate levels, can make the work environment interesting and even challenging. Many people working on projects enjoy a high-stress, exciting environment. When the stress level is too high, the biological reaction increases blood flow to the emotional parts of the brain and decreases the blood flow to the creative parts of the brain, making creative problem solving more difficult. Project managers recognize the benefits of balancing the stress level on the project with the need to create an atmosphere that enables creative thought.

Stress Managed on Steel Project

The electrical lead engineer on the steel project was able to create the environment for the electrical team to focus on the electrical design and explore alternative designs that could generate cost savings. The electrical lead also saw the investment in creating cost savings as an addition to the job. The electrical team stopped to contribute to the project goal and went back to the design work once the electrical cost-saving target was met.

Exploring opportunities to create savings takes an investment of time and energy, and on a time-sensitive project, the project manager must create the motivation and the opportunity for creative thinking.

Key Takeaways

  • Project culture is developed by communicating priority, status, and the alignment of official and operational rules. It is enforced through use of symbols, storytelling, rituals, rewards or punishments, and taboos.
  • Differences in culture between stakeholders can affect communications, negotiations, and decision making.
  • Innovation can be the main focus of the project, or it can be used to achieve improvement in goals that are usually mutually exclusive, such as lowering costs and shortening schedule.


  1. The project ________ is developed by communicating what is important, communicating what gives status, and aligning operational and official rules.
  2. How can innovation achieve improvement in goals?

Internalize your learning experience by preparing to discuss the following.

Describe a team project with which you are familiar where the objective was to find an innovative solution. What was the level of stress and how was it managed to support an innovative atmosphere?


Schein, E., “Organizational Culture,” American Psychologist 45 (1990): 109–19.


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