The general goal of Danish residential care institutions with a therapeutic objective is to change children's behaviour and redirect their identity formation. This goal is pursued through an individualized focus on development. Dynamics of the resident group is rarely targeted directly in the pedagogical work. This article challenges the implicit understanding that social work is the primary source of identity transformation and that peer group interaction is mainly an obstacle to overcome. On the contrary, this article argues that learning about the social dynamics of the children's group is a precondition for understanding how social work influences individual children. (Contains 2 notes.)