When Crisis Becomes the Culture: Understanding Organizational Trauma

By Dr. Larrisa Palmer, Organizational Psychologist & Licensed Therapist

A blurred motion photo of professionals walking through a busy office, symbolizing overwhelm and organizational trauma.

In my last post, we talked about leading through crisis, how to stay grounded, show up, and support your team when the unexpected hits. But what happens when stress, disruption, and uncertainty aren’t temporary, but they’re the norm?

I’ve spent over a decade working in mission-driven organizations where stress was constant. We were always “on” and always putting out fires. Over time, that wear-and-tear doesn’t just impact individuals; it leaves a mark on the organization itself. When a workplace is under chronic strain, something deeper can begin to take shape: organizational trauma.

What Is Organizational Trauma (OT)?

When we think of trauma, we usually think of individuals. But organizations can be traumatized too, and it often goes unnoticed until the symptoms are too loud to ignore.

Vivian and Hormann (2015) define organizational trauma as any event, large or small, that “overpowers the organization’s cultural structure and weakens its ability to respond to internal or external challenges” (p. 25). Ghane et al. (2022) describe OT as the emotional fallout from change employees weren’t ready for, causing them to lose routines, attachments, and trust. Venugopal (2016) adds that OT reflects a dysfunctional shift in the organization’s core patterns. In short, organizational trauma is what happens when the workplace itself carries emotional wounds, and those wounds start to shape the culture. And yes, it’s more common than we think.

Trauma Doesn’t Stay Contained

One of the most important truths about trauma is this: it doesn’t stay isolated. It spreads.

According to de Klerk (2007), trauma starts at the individual level and when it is unaddressed, it spreads through project and projection identification and eventually it is absorbed into the larger system. For example, one employee’s distress, if unacknowledged, can ripple through teams and slowly become normalized. Over time, that distress turns into a culture of mistrust, withdrawal, or survival mode.

Even the most values-aligned workplaces aren’t immune to OT. In fact, caregiving organizations that dedicate their services to healing, learning, ministry, or justice are especially vulnerable because they absorb others’ pain, often without structures to process it (Kahn, 2003).

Where Does Organizational Trauma Come From?

Organizational trauma can occur as a result of different events/sources. Sometimes it’s a single painful event. Sometimes it’s the slow buildup of harm over time, and on other occasions, it would be the nature of the work. According to Vivian et al. (2017), there are four common sources:

1. A Single Devastating Event

This could be the death of a beloved team member, a public scandal, a round of layoffs, or a natural disaster. When trauma is external, the organization’s role in the community may be questioned. When it’s internal, the very values and identity of the organization come under fire.

2. Ongoing Wounding

This is trauma by a thousand cuts, which could include chronic bullying, high turnover, inequity, or unresolved workplace harm. The impact accumulates and erodes trust, morale, and resilience.

3. Empathic Nature of the Work

When an organization’s mission centers on caring for others in pain, its culture can absorb that pain, leaving the system itself vulnerable.

4. The Pressure of a Redemptive Mission

Organizations that exist to “save” or “fix” something in the world can begin to internalize shame when transformation is slow or incomplete. That pressure can become paralyzing.

What Does Organizational Trauma Look Like?

You may be wondering: Is my organization experiencing trauma? Here are some common signs to look for:

• Emotional unpredictability: Staff walk on eggshells. Emotions run high. Conflict lingers.

• Chronic instability: Frequent leadership changes, shifting priorities, or unclear roles.

• Shame and guilt: Employees blame themselves for systemic issues or feel they’re not “doing enough.”

• Lack of trust: Silence, fear of speaking up, or belief that leadership can’t be trusted.

• Re-traumatization: Past painful experiences are repeatedly triggered without resolution.

• Anxiety-based communication: Interactions are reactive, defensive, or avoidant.

• Unsafe processes: No clear policies, unfair practices, or over-reliance on relationships over structure.

  
  

What Can Leaders and Practitioners Do?

The most important question is: How do we help organizations begin to heal?

Trauma is both contagious and exhausting, so it’s critical for leaders and practitioners to approach this work with care, patience, and humility. Healing doesn’t happen overnight, and it’s not linear. It takes intention and repeated action rooted in empathy and systems thinking.

Here are five trauma-informed strategies that can help organizations move from survival to healing:

1. Name the Trauma

We cannot heal what we’re not willing to name. Organizational trauma thrives in silence. Leaders and practitioners must help surface what’s unspoken by creating safe, facilitated spaces for storytelling, reflection, and assessment. Naming the trauma helps staff externalize the pain, recognize shared experiences, and begin desensitization through collective meaning-making (de Klerk, 2007; Vivian & Hormann, 2015).

• Use assessments, guided discussions, and reflective tools to bring the narrative to light.

• Normalize the use of words like “trauma,” “grief,” “mistrust,” and “burnout” in leadership conversations.

2. Prioritize Psychological Safety

Before organizations can rebuild or transform, people must feel emotionally safe.

Psychological safety isn’t just a leadership buzzword, it’s the bedrock of healing. Leaders must intentionally create environments where people feel safe to speak up, ask questions, and express vulnerability without fear of retaliation. This kind of safety is foundational for trust and recovery in trauma-exposed organizations (Edmondson, 1999; Kahn, 2003; Vivian & Hormann, 2015).

• Establish clear boundaries, structure, and expectations to contain emotional intensity.

• Model transparency, consistency, and accountability to rebuild trust.

3. Work Slowly and Build Trust

There is no quick fix for organizational trauma. Healing is slow and messy. Trust must be rebuilt over time through repeated and congruent actions (Vivian & Hormann, 2015).

• Expect resistance, fatigue, and silence. Don’t push people faster than they’re ready.

• Use repetition, clarity, and emotional pacing. Trauma recovery is about consistency, not urgency.

4. Attend to Grief and Loss

Trauma often includes loss of people, of stability, of identity, or purpose. Yet in organizational life, grief is rarely named or honored. Leaders must recognize what has been lost and create space to mourn together (Kahn, 2003; Powley & Cameron, 2006).

• Make time to pause and reflect as a community.

• Hold space for rituals, memorials, or simple acknowledgments that help people process collective grief.

5. Align Culture with Healing, Not Just Performance

Healing doesn’t happen in a vacuum, it happens through the systems and culture people interact with every day. Too often, organizations jump to performance improvement while bypassing the need for relational repair. To foster healing, organizations must shift culture intentionally, rebuilding processes that prioritize equity, voice, and emotional care (Vivian & Hormann, 2015; Kahn, 2003; Powley & Cameron, 2006).

• Focus on relationships, not just results.

• Reevaluate policies and practices to ensure they support transparency, fairness, and inclusion.

• Encourage cross-functional dialogue that rebuilds connections across silos.

Organizational trauma means that something painful happened, and healing is possible.

But it requires leadership that’s willing to sit with discomfort, embrace transparency, and prioritize care as a core function of organizational life. If you or your team are navigating organizational stress, burnout, or unresolved trauma, I invite you to connect. Let’s explore what healing could look like together: 👉 www.revitalaconsulting.com

References

• Edmondson, A. (1999). Psychological safety and learning behavior in work teams. Administrative Science Quarterly, 44(2), 350–383. https://doi.org/10.2307/2666999

• de Klerk, J. J. (2007). Healing emotional trauma in organizations: An O.D. framework for psychosocial intervention. Journal of Organizational Change Management, 20(5), 721–739.

• Ghane, E., Kelidbarlee, A., Kiakojoree, M., & Farokhseresht, M. (2022). Organizational trauma and readiness for change. Journal of Organizational Behavior Research, 7(1).

• Kahn, W. A. (2003). The revelation of organizational trauma. The Journal of Applied Behavioral Science, 39(4), 364–380.

• Powley, E. H., & Cameron, K. S. (2006). Organizational healing: Lived virtuousness amidst organizational crisis. Journal of Management, Spirituality & Religion, 3(1), 43–63.

• Venugopal, B. (2016). Organizational trauma: A theoretical overview. International Journal of Management Research and Business Strategy, 5(1).

• Vivian, J., & Hormann, S. (2015). Organizational Trauma and Healing. CreateSpace Independent Publishing Platform.

• Vivian, J., Cox, R., Hormann, S., & Murphy-Kangas, B. (2017). Recognizing and healing organizational trauma. OD Practitioner, 49(3), 26–31.