In business management, a learning organization is a company that facilitates the learning of its members and continuously transforms itself. The concept was coined through the work and research of Peter Senge and his colleagues.
Learning organizations may develop as a result of the pressures facing modern organizations; this enables them to remain competitive in the business environment.
Characteristics
There are many definitions of a learning organization as well as typologies of kinds of learning organizations.
Peter Senge stated in an interview that a learning organization is a group of people working together collectively to enhance their capacities to create results they really care about. Senge popularized the concept of the learning organization through his book The Fifth Discipline. In the book, he proposed the following five characteristics:
Systems thinking
The idea of the learning organization developed from a body of work called systems thinking. Learning is considered to be more than just acquiring information; it is expanding the ability to be more productive by learning how to apply our skills to work in the most valuable way. Personal mastery appears also in a spiritual way as, for example, clarification of focus, personal vision and ability to see and interpret reality objectively. Individual learning is acquired through staff training, development and continuous self-improvement; Due to selective observation, mental models might limit peoples’ observations. To become a learning organization, these models must be identified and challenged. Individuals tend to espouse theories, which are what they intend to follow, and theories-in-use, which are what they actually do. In creating a learning environment it is important to replace confrontational attitudes with an open culture
Shared vision
The development of a shared vision is important in motivating the staff to learn, as it creates a common identity that provides focus and energy for learning. Applying the practices of a shared vision creates a suitable environment for the development of trust through communication and collaboration within the organization. As a result, the built shared vision encourages the members to share their own experiences and opinions, thus enhancing effects of organizational learning.
Team learning
The accumulation of individual learning constitutes team learning. In such a learning environment, people don't have to hide or overlook their disagreements, so they make their collective understanding richer. In a learning organization, teams learn how to think together. Chris Argyris identified that organizations need to maintain knowledge about new products and processes, understand what is happening in the outside environment and produce creative solutions using the knowledge and skills of all within the organization. This requires co-operation between individuals and groups, free and reliable communication, and a culture of trust. For example, USAID has a number of technical website platforms focused on development topics including Learning Lab, AgriLinks, DRGLinks, Edulinks and ResilienceLinks.
Benefits
One of the main benefits being a learning organization offers is a competitive advantage. This competitive advantage can be founded on different strategies, which can be acquired by organizational learning. One way of gaining a competitive advantage is strategic flexibility. The continuous inflow of new experience and knowledge keeps the organization dynamic and prepared for change. In an ever-changing institutional environment this can be a key factor for an advantage. Better management of an organizations explorative investments and exploitative acting can be a benefit of a learning organization, too. Next, a competitive advantage of a company can be gained by lower prices and better quality of products. Through organizational learning both cost leadership and differentiation strategies are possible. The ability to reconfigure actions based on needs and environment avoids the tradeoff between the two.
Other benefits of a learning organization are:
- Maintaining levels of innovation and remaining competitive
- Having the knowledge to better link resources to customer needs
Problems with Senge's vision include a failure to fully appreciate and incorporate the imperatives that animate modern organizations; the relative sophistication of the thinking he requires of managers (and whether many in practice are up to it); and questions regarding his treatment of organizational politics. It is certainly difficult to find real-life examples of learning organizations (Kerka 1995). There has also been a lack of critical analysis of the theoretical framework.
Based on their study of attempts to reform the Swiss Postal Service, Matthias Finger and Silvia Bűrgin Brand (1999) provide a useful listing of more important shortcomings of the learning organization concept. They conclude that it is not possible to transform a bureaucratic organization by learning initiatives alone. They believe that by referring to the notion of the learning organization it was possible to make change less threatening and more acceptable to participants. 'However, individual and collective learning, which has undoubtedly taken place, has not really been connected to organizational change and transformation'. Part of the issue, they suggest, has to do with the concept of the learning organization itself. They argue that the concept of the learning organization:
- Focuses mainly on the cultural dimension and does not adequately take into account the other dimensions of an organization. To transform an organization, it is necessary to attend to structures and the organization of work as well as the culture and processes. 'Focussing exclusively on training activities in order to foster learning... favours this purely cultural bias'.
- Favours individual and collective learning processes at all levels of the organization, but does not connect them properly to the organization's strategic objectives. Popular models of organizational learning (such as Dixon 1994) assume such a link. It is, therefore, imperative 'that the link between individual and collective learning and the organization's strategic objectives is made'. This shortcoming, Finger and Brand argue, makes a case for some form of measurement of organizational learning – so that it is possible to assess the extent to which such learning contributes or not towards strategic objectives.
While there are different challenges in implementing learning organization in different fields, the concept has been proven successful in cases ranging from commercial firms, NGOs, schools, to field archaeological institutions.
Challenges in the transformation to a learning organization
The book The Dance of Change states there are many reasons why an organization may have trouble in transforming itself into a learning organization. The first is that an organization does not have enough time. Fragmentation is described as breaking a problem into pieces. For example, each organization has an accounting department, finance, operations, IT and marketing. Competition occurs when employees are trying to do better or 'beat' others in an assignment instead of collaborating. Reactiveness occurs when an organization changes only in reaction to outside forces, rather than proactively initiating change.
Inappropriate habits while organizing team meetings can effect negatively. Meetings should be prepared in time, agenda drawn up and enough time dedicated to focus on the subjects. Because best results in team learning form through discipline, it is essential to have an agenda, make atmosphere open and respect others: avoid interruption, be interested and respond.