Learning Organizations Given Such Rapid

Learning Organizations

Given such rapid and increasingly complex changes across the world in business and technology, how can companies ensure that they will be able to continue to keep in pace and succeed in the future? What is the best way to face these major continuous transitions, which not only impact work but families, communities and society as a whole? One of the suggestions is a the field called organizational learning, which explores and analyzes different methods to design and build organizations in order to effectively meet their goals and mission, motivate employees to attain their full potential and bring about positive change in the world. In a learning organization, employees continually create, acquire and transfer knowledge -- helping their company adapt to the unpredictability of the future faster than their rivals.

One of the most quoted definitions of a learning organization is that of Peddler, Burgoyne and Boydell. (1991, pg. 1): "an organization, which facilitates the learning of all its members and continuously transforms itself." Senge (1990) defines this organization by focusing more on the contribution of employees: "A group of people working together to collectively enhance their capacities to create results that they truly care about." (pg. 18). Garvin (1993) suggests the definition of "an organization skilled at creating, acquiring and transferring knowledge, and at modifying its behavior to reflect new knowledge and insights."

Organizational learning is a broad term that goes back to the beginning of sociology.

Starting as early as Max Weber and moving to the present, historians have been interested in the development of new industries, technologies and research and development as institutionalized learning mechanisms; industrial economists have used organizational learning to determine the affect of productivity and industrial structures; company management has relied on this method to examine the correlation between learning and innovation at the strategic management level for new product development; and the concept of "learning curves" has been used extensively in management education (Dodgson, 1993). Most recently, human resource management (HRM) has turned to organizational learning to enhance knowledge and thus determine the company's core capabilities. As strategic management theories move closer toward resource-and- knowledge-based perspectives, researchers are focusing more on the internal workings of a firm to determine sources of competitive advantage and create value. Knowledge helps organizations effectively use, maneuver, and alter a variety of organizational resources (Kang, Morris & Snell, 2007).

Interest in organizational learning has steadily increased over recent decades and has defined seven dimensions common to all learning organization as defined by Marsick and Watskins (2003): 1) develop continuous learning alternatives; 2) further inquiry and discussion; 3) support group efforts and team learning; 4) offer strategic leadership opportunities; 5) encourage a collective vision; 6) interconnect the organization and its environment; and 7) establish systems to capture and share learning. Organizations that adopt and implement these learning organization characteristics or dimensions are found to have continuous improvement in performance.

According to Demers (2007) people in a learning organization have no difficulty speaking up about what is on their mind. If and when they make a mistake, they are not afraid to admit it. They understand that change is an integral part of the improvement process and this only comes through ongoing trial and error. Employees typically feel comfortable about discussing their work challenges and disagreements and eagerly share information about what does or does not function correctly. The organization welcomes differences of opinion, and the employees are open to different methods of getting their work accomplished. They support new ideas, are interested in other options, and find time to review the status of their work. A learning organization often discovers varied working methods, experiments with new products and services, implements a formal process for conducting and evaluating these experiments and frequently develops prototypes or simulations when attempting new ideas. The firm has an established means for gathering information on competitors, customers, economic and social and technological trends and comparing its performance against those companies that are considered best in class. It productively engages in positive conflict and debate during discussions, welcomes dissenting views during dialogue, and identifies and debates underlying assumptions that may influence key decisions. When new employees are hired, their orientation includes adequate training. All employees receive training for periodic updates, changes to new positions, and launches for new initiatives. Education and training is valued and time is purposely set aside for this learning. Experts from other departments and outside the organization, as well as customers and suppliers share information and quickly and accurately communicate new knowledge to established decision makers.

Naturally, not all organizations are structured for learning and they range in their ability to incorporate the learning characteristics. Depending on their structure, barriers make it difficult to encourage knowledge acquisition and sharing (Garvin & Edmondson, 2008). Many companies, for example, still follow the top-down traditional structure where managers are not sensitive to differences among departmental processes and behaviors. Since learning is not established as an end goal, people and groups vary in their focus of learning maturity. Managers must be particularly sensitive to local cultures of learning that often vary considerably across the organization. For example, in a healthcare organization, one department may be more open to report and discuss customer servicing errors than another. The efforts of a learning organization need to be multidimensional and respond to different needs. They need to open dialogues and not critique. If management is not thoughtful when choosing the levers of change and do not think broadly about available options that fit into its unique culture, establishing a learning environment is difficult.

Once a company determines that learning is an essential part of its mission and goals, it has to have a means for continually measuring the organization's capability. Many companies have not yet reached this point, since they have just recently changed their focus or do not know the best way to evaluate how well they are doing in attaining learning characteristics. Much of their information is based on anecdotal evidence. A few studies have been conducted that provide options for measurement. A study conducted by Goh (1998) with over 1000 employees in 7 public and private sector companies concluded that organizational practices in the following areas do seem to discriminate between firms that are learning well and those that are not: 1) business planning and performance measurement (establishing clarity of purpose); 2) leadership skills (management practices that encourage learning and sharing as well as create a culture of achievement and development); 3) communication methodologies (transfer of knowledge and learning); 4) teamwork (leveraging individual learning); new product and/or service development processes (experimentation); and 5) proactive management of learning. Tannenbaum (1997) conducted research in the service, manufacturing, military, private and non-profit industries and found that the key factors that encouraged learning climates were: 1) people are knowledgeable about the "big picture"; 2) task assignments are provided that give individuals the opportunity to apply skills learned; 3) errors are tolerated; 4) employees are accountable for learning; 5) situational barriers to learning are minimized; 6) new concepts and approaches are valued and encouraged; 7) supervisors and co-workers offer support and encouragement to apply learning; and 8) policies and practices support the efficient utilization of training. Tannebaum found that each learning organization emphasized different aspects depending on their specific operating environment.

One of the ways to measure these above noted parameters is through a balanced score card. This is a strategic planning and management system utilized often by global business and industry, government, and nonprofit organizations to ensure that their activities are properly in line with the organization's vision and strategy, improve internal and external communications, and monitor performance against strategic goals. Kaplan and Norton (1996) originated the process as a framework to add strategic non-financial performance measurements to traditional financial metrics and offer management and executives a more "balanced" view of organizational performance. It is similar to the "dashboard" of performance measurement that has been used since the early part of the 20th century. The score card establishes a framework that provides performance measurements and also assists planners to identify what needs to be accomplished and measured. It enables organizations to definitively execute their strategies. Kaplan and Norton (1996) describe the innovation of the balanced scorecard as:

The balanced scorecard retains traditional financial measures. But financial measures tell the story of past events, an adequate story for industrial age companies for which investments in long-term capabilities and customer relationships were not critical for success. These financial measures are inadequate, however, for guiding and evaluating the journey that information age companies must make to create future value through investment in customers, suppliers, employees, processes, technology, and innovation (p. 76).

Kaplan and Norton (1996) explain that with the balanced score card, the organization is viewed and measured from four perspectives: learning and growth, customer, financial and internal business practices. The learning and growth perspective consists of employee training and corporate cultural attitudes that are related to employee and organizational self-improvement. In a learning organization, people, the repository of knowledge, are the primary resource. In the present environment of rapid technological change, it is essential for knowledge workers to continuously be in a learning mode. Metrics need to be put into place to assist managers in focusing training funds where they can be of most use.

Kaplan and Norton (1996) emphasize that learning is not the same as training. It consists of factors such as mentoring and tutoring within the organization, in addition to openness of communication among workers that gives them the opportunity to easily get assistance on a problem when needed. It also includes technological tools or what the Baldrige criteria call "high performance work system. The internal business process provides metrics that help managers know how well their business is running and whether its products and services conform to customer requirements. This organizational learning measurement also recognizes the importance of customer service. Poor performance is a leading indicator of future decline despite the fact that the present situation appears positive. Kaplan and Norton also recognize that timely and accurate funding data will always be a priority, but it must be balanced with these other three perspectives.

Another measurement of organizational development has been developed by Goh (1998), who identified five major organizational characteristics and/or management practices essential for learning opportunity within an organization: 1) clarity and support for mission and vision to provide a foundation of empowerment that encourages decision-making and innovation; 2) shared leadership and involvement, where employees are frequently involved in organizational decisions on a regular and frequent basis and leaders who are viewed as coaches and facilitators offering constructive criticism; 3) a culture that encourages experimentation that encourages people to ask, "How can this be done better?"; 4) ability to transfer knowledge across organizational boundaries, where learning is shared among departments and internal mechanisms are created to foster a sharing of knowledge and expertise; and 5) teamwork and cooperation, so that employees can work together to solve problems, improve processes and foster innovation. Goh (1998) also identified the need for the "two major supporting foundations" of effective organizational design and appropriate employee skills and competencies.

Based on these five characteristics, Goh (1998) developed a survey to identify the organization's learning capability. The authors explain that elements of an organization, such as its structure, tasks, decision-making processes, reward systems and communication processes, can either encourage or discourage learning and information exchange. Therefore, one can assess how well an organization's design helps to clarify goals, encourage experimentation, and promote teamwork and information sharing and evaluate the organization's learning capability. The authors thus devised an organizational learning survey that has 21 questions separated into the noted five sub-scales. These questions were developed through a literature review of over 100 articles on the concept and practice of organizational learning.

When looking at how different researchers define organizational learning, it appears that there is similarity of characteristics among them. Based on this similarity, the four strongest parameters of a company that encourages and succeeds with organizational learning are: 1) a nonjudgmental and open environment where employees are free to admit mistakes, experiment and share with others; 2) a horizontal organizational structure, where information is shared across the departments rather than from the traditional top down model and employees are encouraged to partake in decision making and submitting ideas and debating different ways that things can be accomplished; 3) an emphasis on continuous learning, so that education and training are incorporated into all aspects of the work; and 4) a means of easily sharing information and expertise throughout the organization as well as from external experts, customers and outside vendors.