I always act on the basis of who I am. Who I perceive myself to be has massive repercussions upon how I behave and what my attitudes/motivations are. This seems to be the basis of Paul's exhortations towards holiness. As scholars have noted, the imperative in Paul's letters is always based on the indicative. He always exhorts us on the basis of who we are and what we have become in Christ. Our actions naturally flow out of our core identity and how we view ourselves. Change and sanctification are therefore strongly connected with a transformation in our identity. As our identity changes so we change. It is vital that I get to see who I am in Christ and what I have in Christ, for this is the basis of me being transformed.
Thankfully, Paul also gives us a worked-out example of this in 1 Cor 6:12-20, where he is dealing with sexual immorality. In confronting the immorality, he calls the Corinthians to understand who they really are and what they have become. They are now "in Christ" and so for them to sleep with a (shrine) prostitute is to unite Christ with a prostitute. The thought of that, a very powerful image, makes us aware of what sin really is when you belong to Christ. We are alive to God so why do we offer ourselves to sin? So, the basis of change here is not simply knowing that it's wrong and against God's will, nor feeling bad about it, but seeing yourself in the light of Christ. This example can be extended to lots of areas of life. In each and every situation I need to think "I'm in Christ, I belong to Him and enjoy all His benefits, so what is the natural thing to do here??" It is about looking at every situation from the vantage point of Christ.