Chapter 13 Organizing for Learning

1. Chapter 13Organizing for Learning

2. Scope of Chapter 13 • Strategic importance of organizational learning • Nature of organizational learning • Requirements for organizational learning • Learning through alliances • Implications for practice

3. Strategic Importance of Organizational Learning • Firms that can apply superior knowledge can adapt better to changing conditions and take advantage of emerging opportunities • Organizational learning refers to the capacity to acquire, develop and apply new knowledge, for example • to innovate new products and services • to evolve superior operating methods

4. Significance of Organizational Learning Survival To survive, an organization’s rate of learning must be equal to or greater than the rate of change in its environment and its competitors. Intellectual Assets Intangible, knowledge assets are becoming more important Rising market-to-book values of firms: S&P 500 firms rose 6 times 1981-2001

5. The Tip of the Iceberg Financial, physical resources: - visible - always evaluated • Intellectual • capital and • knowledge: • - invisible • often not • evaluated Source of renewal

6. The Nature of Organizational Learning

7. Defining learning “Learning refers to both the process of acquiring new knowledge and the outcome.” “The outcome of learning is the acquisition of a new competence: an ability to apply new knowledge to the better performance of an existing activity or task, or to prepare for new circumstances.” (Child & Heavens 2001)

8. Defining OrganizationalLearning and a Learning Organization Organizational Learning refers to the enhancement, through its own efforts, of the knowledge available to an organization and its ability to apply that knowledge A Learning Organization is one that is skilled at acquiring knowledge, through creating or importing it, and at modifying its behaviour to reflect new knowledge and insights

9. The Organizational Learning Cycle: from Data to Wisdom Information Knowledge Data Wisdom

11. Tacit and Explicit Knowledge Tacit Knowledge • Personal, intuitive and context-specific knowledge. • Difficult to verbalize, formalize, and communicate to others Explicit Knowledge • Specified and codified • Relatively esy to transmit in formal systematic language

13. Organizational Learning Loops at Three Levels [See Figure 13.1, Chapter 13]

14. [See Figure 13.2, Chapter 13] Requirements for Organizational Learning

16. Requirements for Organizational Learning: Leadership Leadership • Required to break the mould of established thinking and practice • Essential for top management to express a clear intention that its organization shall learn • Role of breaking down embedded barriers to learning: ‘frame-breaking’ • Role in establishing an organizational culture that supports learning

17. Requirements for Organizational Learning: Organizing for Learning • Three key channels of communication [See Figure 13.3, Chapter 13] • ‘Controlled autonomy’ • Control directed at monitoring learning achievement and supporting learning through allocation of resources • ‘Interactive control’: control combined with a dialogue to encourage learning • Integration across internal boundaries, including use of teams [See also Chapter 4] • Selecting the task given to the team • Ensuring sufficient diversity of knowledge and skills within the team • Managing team integration • Managing external boundaries

18. Requirements for Organizational Learning: Capacity to Learn • Transferability of knowledge into the organization • Receptivity to new knowledge • Competence – ability to assess, assimilate and apply new knowledge • Previous experience – of successful learning and/or of learning through collaboration

19. Requirements for Organizational Learning: Conversion of Knowledge into an Organizational Property Four modes of knowledge conversion need to take place: • Socialization • Externalization • Combination • Internalization Source: Nonaka and Takeuchi 1995

20. Learning in and through Alliances Three processes: • transfer of knowledge by the partners to the alliance and to each other via the alliance • creation of new knowledge by the alliance unit • the harvesting of alliance-generated knowledge by the partner(s)

21. Types of Learning in Alliances Depends on Partners’ “Strategic Intent” COLLABORATIVE Long-term co-existence feasible & desirable Aim is sustainability of the venture Win-win situation COMPETITIVE Intended asymmetry in knowledge gains Race between partners: “Who learns first” Tendency towards instability

22. Barriers to Learning in Alliances Cognitive: • e.g. strategic priorities do not include learning from partner Emotional: • e.g. mistrust between partners and their personnel Organizational: • e.g.control and reward systems not focused on learning; poor communication and knowledge management systems Inadequate competencies: • e.g. best staff not sent to alliance; lack of training

23. Overcoming the Barriers to Learning: in Alliances and other Organizations • Surmount cognitive & emotional barriers • Generate positive intent, commitment & trust • Reduce organizational barriers • Leadership to provide & promote a clear vision • Control to establish limits & to assess outcomes • Promote open communication to facilitate knowledge migration • Personal facilitation by “knowledge activists” • Use modern ICT • Value of information redundancy

24. Implications for Practice To be successful, organizational learning has to be actively managed: • Top management must recognize the significance of OL • Role of learning project coordinators and team leaders needs to be understood • A balance has to be acheived between the pace of learning and the capacity of an organization to cope with change