I’ve been thinking about culture the wrong way for most of my career. For years, I treated it as something you build through offsites and values statements and Slack channels with clever names, as if culture were a thing you could construct deliberately and then maintain through periodic reinforcement. The longer I’ve led engineering teams, the more I’ve come to see culture as something closer to a bank account: built slowly through consistent deposits and drained quickly through structural withdrawals. And reorgs are the largest single withdrawals a leader can make.
The Balance Model
Every consistent decision a leader makes is a deposit. Following through on commitments, promoting the right person when the political choice would have been easier, protecting a team from organizational noise so they can ship, saying no to a project that doesn’t serve the roadmap even when a VP is pushing for it. These deposits compound slowly, and they’re easy to take for granted precisely because their value is cumulative rather than dramatic.
Withdrawals work differently. A single broken promise, a sudden priority shift that invalidates a quarter of work, a reorg that separates a team that was finally hitting its stride: any one of these can erase months of deposits in a week. This asymmetry mirrors the loss aversion that behavioral economists have documented in financial decisions, and it is the thing that makes culture so fragile. Deposits are incremental and forgettable; withdrawals are sudden and memorable.
Why One Reorg Is the Limit
I say “exactly one reorg” in the title because that’s roughly the cultural buffer most teams have. A well-run organization can absorb one reorg and recover. People understand that structures need to evolve; they accept the disruption if they trust the leadership and believe the reasoning. But each subsequent reorg draws down a balance that the previous one already depleted, and the recovery time between them is rarely long enough to rebuild what was lost.
Culture is deposited through consistent decisions and withdrawn through structural changes. The deposits are incremental and forgettable; the withdrawals are sudden and memorable.
The mechanics of why reorgs cost so much culturally deserve examination, because they run deeper than “people don’t like change.” A reorg disrupts three things simultaneously: working relationships, informal knowledge networks, and the implicit contracts people have with their managers and teammates. The engineer who spent six months building trust with a product manager now reports to someone different, the informal lunch group that served as the fastest information channel between two teams gets scattered, and the promise that “this team will own this domain” gets quietly broken. Each of these disruptions is individually manageable; their simultaneous occurrence is what makes reorgs so culturally devastating.
When Reorgs Are Necessary
Some reorgs are unavoidable, and pretending otherwise is its own form of organizational malpractice. In rare cases, a reorg can even function as a cultural deposit: dismantling a toxic team structure or removing a dysfunctional reporting hierarchy can free people who were suffering under the old structure. After an acquisition, when two engineering teams with fundamentally different architectures and cultures need to merge, a reorg is the honest path forward; leaving the teams artificially separate delays the inevitable integration and creates two parallel hierarchies that compete rather than collaborate. When team boundaries have drifted so far from the product architecture that every feature requires coordination across three or four teams, the coordination tax is a slow bleed that a reorg can stop. When the product itself has pivoted beneath the org, and teams are structured around a product that no longer exists in the form they’re building for, the structural debt needs to be addressed.
In crypto and startup environments, this tension runs hotter. Pivots are frequent, market conditions shift quarterly, protocol upgrades can reshape what’s technically possible, and the organizational structure that made sense six months ago may be wrong today. The temptation to reorganize in response to every strategic shift is strong, and teams that reorganize every time the market moves spend more energy absorbing structural change than building product.
When Reorgs Are Destructive
Destructive reorgs are easier to spot from the outside and nearly invisible from inside the decision. Sometimes the real problem is a manager who isn’t performing or two team leads who can’t collaborate, so leadership restructures the org around the conflict instead of addressing it. Other times a new VP wants to “put their stamp on things,” a pattern so common in tech leadership that it practically has its own playbook. And sometimes the current structure is imperfect with friction that could be reduced, but leadership pushes a reorg without reckoning with the cultural cost of the change itself.
The tell is usually in the stated justification. Necessary reorgs have specific, structural diagnoses: “Team A and Team B both own pieces of the same service, and every deployment requires coordinating across both teams, which is causing a two-week delay on features that should take three days.” Destructive reorgs have vague, aspirational language: some variation of breaking down silos, moving faster, or improving alignment. Those goals are real, but a reorg is rarely the instrument that achieves them, and the cultural cost of the attempt can make the original problem worse.
Minimizing the Cultural Withdrawal
When a reorg is necessary, the goal shifts from prevention to damage limitation: making the withdrawal as small as possible whilst still achieving the structural change. I’ve learned a few things about how to do this, most of them the hard way.
Communicate before deciding, or at least before announcing. The fastest way to maximize cultural damage is to announce a reorg as a fait accompli. People who learned about a structural change that affects their daily work from an all-hands slide feel disposable, regardless of how thoughtful the reasoning was. Involving affected people in the process, even if the outcome is predetermined, changes how the withdrawal lands. Consultation doesn’t mean consensus; you can make a decision that some people disagree with and still preserve trust, as long as people feel their perspective was heard before the decision was made.
Be specific about what’s changing and why. People read vagueness during a reorg as dishonesty, because they assume that if you’re not telling them the real reason, the real reason is worse than what you’re saying. Be concrete: this team is merging with that team because the current split creates a deployment coordination problem that’s costing us X days per feature. Specificity also lets people evaluate whether the change addresses the stated problem, which builds credibility even when they disagree with the approach.
Involving people in the reorg process is about ensuring their perspective was heard before the decision was final, a distinction worth more cultural capital than most leaders realize.
Preserve what’s working. Most reorgs throw out the good along with the bad because it’s easier to redesign from scratch than to surgically remove the parts that aren’t working. If a team has effective rituals, productive working relationships, and a healthy cadence, restructuring around those elements rather than through them reduces the cultural cost significantly. The temptation to start fresh is strong, and the cost of rebuilding what you discarded tends to dwarf the cost of preserving it.
Name the cultural cost explicitly. Acknowledging that a reorg is a withdrawal that disrupts trust, relationships, and informal networks signals to the team that you understand what you’re asking of them. Leaders who frame reorgs as “exciting new opportunities” and “empowering teams to move faster” come across as either naive or dishonest, and neither reading builds trust. The reorg might be the right call; it’s still going to hurt, and saying so out loud is itself a deposit.
Rebuilding After the Withdrawal
After the reorg lands, the deposit work begins immediately, and the first few weeks matter disproportionately. New teams need to build trust from scratch, which means the leader’s visible behavior during this period carries outsized weight. Showing up to the new team’s standups, following through on small commitments, being present when things are hard: these are deposits, and they compound faster in the aftermath of a withdrawal because people are watching closely to see whether the post-reorg promises will be kept.
The balance metaphor isn’t perfect; culture isn’t quantifiable, and some withdrawals damage specific dimensions of trust more than others. But it captures something important about dynamics I’ve seen play out across multiple organizations: the asymmetry between building and breaking, the cumulative nature of leadership credibility, and the disproportionate cost of structural change.
Every leader will need to make a withdrawal eventually. Markets shift, products pivot, teams grow past their structures. The discipline is in recognizing that each withdrawal draws down a balance that was built slowly and can’t be rebuilt quickly, and calibrating accordingly. The question before any reorg should be: is the structural improvement worth the cultural cost? Sometimes the answer is yes, and having the courage to act on it is part of the job. But the answer should never be “I don’t know, because I haven’t thought about the cultural cost at all.”