Performance is entirely uncoupled from reward and punishment.
Who you know is everything - it's the difference between getting a slap on the wrist for a serious offence, or getting the hand lopped off for a more minor infraction.
For the most part, people honestly have the best intentions - but they consistently aren't given the tools or time to take a project through to completion, leading to half-implemented systems that hamstring the people forced to use them.
Communication from leadership is so poor that literally hundreds of man-hours can be devoted to an improvement project that becomes obsolete within two weeks of implementation, even if the obsolescence was know and planned for with 8 months of lead time. As you can imagine, this leads to frustration and lack of motivation.
Increasingly, the only winning strategy is to avoid attention - any decision is a bad one, so you must avoid having to make decisions at any cost, either by passing the buck or ducking opportunities for input.
Trying to bring problems to the attention of management is risky at best - odds are worse than 50/50 that you will be warned or punished for rocking the boat, vs. having any action taken on the issue.
All of the above lead to a sense of hopelessness; it feels that anyone with the skills and ability has already left or is planning their escape, and there is serious brain drain of both new talent and bastions of institutional knowledge.
