“In the knowledge-creating company, inventing new knowledge is not a specialized activity—the province of the R&D department or marketing or strategic planning. It is a way of behaving, indeed a way of being, in which everyone is a knowledge worker—that is to say, an entrepreneur.”
Personally, the most capable organizations I have been a part of are exceptional learning (or knowledge-creating) organizations. They cultivate learning and are focused on deploying it as a key success factor all the way from recruiting through retention.
While there are many definitions of a “learning organization,” my favorite is: an organization that continually transforms itself by facilitating the learning of its members.
New ideas create the potential for organizational improvement but they must be accompanied by changes in the way work gets done. Many organizations are successful at creating new knowledge but are not as effective at applying the new knowledge. The bottom line: success means translating new knowledge into new ways of behaving through systems and processes that support the institutionalizing of learning.
In this article I will summarize the findings from some of the key literature on the subject (Senge, Nonaka and Garvin) and propose practical approaches to becoming a learning organization.
Peter Senge popularized learning organizations in his book, The Fifth Discipline. He described learning organizations as places “where people continually expand their capacity to create the results they truly desire, where new and expansive patterns of thinking are nurtured, where collective aspiration is set free, and where people are continually learning how to learn together.”
Senge identifies five “component technologies” (offered with some key take-aways):
- Systems thinking – Use of tools to organize systems thinking including project management, financial reports, KPIs, and statistical methods.
- Personal mastery – Learning can’t be forced; individuals are either life-long learners or they are not. The key is what kind of people are being brought into the organization.
- Mental models – Tribal knowledge of past experiences is reduced to mental models which promote inquiry and trust when effectively conveyed – what another champion of organizational learning, Ikujiro Nonanka, calls tacit knowledge.
- Shared vision – Learning flourishes in organizations when a common identity exists based on a shared vision.
- Team learning – Open communication and dissemination of ideas is critical to team learning.
Ikujiro Nonaka characterized knowledge-creating companies as places where “inventing new knowledge is not a specialized activity. It is a way of behaving, indeed, a way of being, in which everyone is a knowledge worker.” Nonaka believes learning organizations focus on making instinctively understood ideas (tacit knowledge) explicit through the use of metaphors and organizational redundancy to focus thinking and encourage dialogue.
Explicit knowledge is formal and systematic. For this reason, it can be easily communicated and shared, in product specifications or a scientific formula or a computer program. Tacit knowledge, on the other hand, consists partly of technical skills—the kind of informal, hard-to-pin-down skills captured in the term “know-how,” e.g. a master craftsman after years of experience develops a wealth of expertise “at their fingertips” but they are often unable to articulate the scientific or technical principles behind what they know.
David Garvin’s Harvard Business Review article, Building a Learning Organization, identifies five building blocks that successful learning organizations have in common. His analysis suggests that effective organizations learn faster than their competition because they have linked continuous improvement and learning. Garvin states: “In the absence of learning, companies—and individuals—simply repeat old practices. Change remains cosmetic, and improvements are either fortuitous or short-lived.” His definition is: “A learning organization is an organization skilled at creating, acquiring, and transferring knowledge, and at modifying its behavior to reflect new knowledge and insights.”
Garvin makes a valuable point about the three overlapping stages of organizational learning. “The first step is cognitive. Members of the organization are exposed to new ideas, expand their knowledge, and begin to think differently. The second step is behavioral. Employees begin to internalize new insights and alter their behavior. And the third step is performance improvement, with changes in behavior leading to measurable improvements in results: superior quality, better delivery, increased market share, or other tangible gains. Because cognitive and behavioral changes typically precede improvements in performance, a complete learning audit must include all three.”
Garvin’s five building blocks:
- Systematic problem solving
- Learning from past experience
- Learning from others – benchmarking
- Transferring knowledge
Key take-aways from Garvin’s five building blocks include:
Attention to detail so you are no longer prisoner to sloppy reasoning – Use of the Deming Cycle (Plan Do Check Act) rather than guess work, reliance on data rather than assumptions, and fact-based management based on statistical tools to organize data. Action: Use problem solving training to establish a common vocabulary and consistent approach.
Status quo is entrenched and hostile to new ideas – Deploy new knowledge through experimentation with a focus on incremental improvements aimed at productivity enhancements and cost reduction. Implement incentives that favor risk taking – the team must feel that the benefits of experimentation exceed the costs. Action: Use demonstration projects at a single site prior to broad adoption – learn by doing.
Knowing versus knowing why – Assess successes AND failures; knowledge gained from failure is valuable IF assessed and lessons are learned and valued. Like any deployment of the scientific method it takes forethought to set up the “experiment” that will give a productive result whether it succeeds or fails. Action: Get outsiders to post appraise and apply lessons learned to future projects. Make sure it’s a senior level team reporting to executive management.
Something that goes well but nobody knows why – what IBM calls unproductive success versus a productive failure. “A productive failure is one that leads to insight, understanding, and thus an addition to the commonly held wisdom of the organization. An unproductive success occurs when something goes well, but nobody knows how or why.”
Benchmarking; learning from others – Focus on learning from studying practices, NOT results. According to one expert, “benchmarking is an ongoing investigation and learning experience that ensures that best industry practices are uncovered, analyzed, adopted, and implemented.” Action: Get out and see how customers are actually using your product or service. Often customers are unable to communicate their issues accurately and their verbal input can be misleading. If you have them, ask your field service employees what they observe about how customers use your products.
Velocity in sharing knowledge – Ideas carry maximum impact when they are shared broadly. Reports, rotation programs, site visits, and training programs are all effective tools to convey new knowledge. In today’s vernacular, YouTube is a powerful tool to convey learning around the organization because of its ubiquitous access and content. Beware of good news bias – everybody loves to tell about their hot stock picks but nobody talks about their losers and these have value too. Action: Outside training is expensive. Ensure its value is expanded throughout the organization by creating an expectation of a formal written report of what was learned and how it can be implemented.
Practical Approaches to Becoming a Learning Organization
Negative Experiences – Negative experiences are powerful catalysts for learning but they can also make an organization gun shy. If an initiative resulted in a particularly painful outcome, organizations can find themselves avoiding similar opportunities in the future because the collective memory of the experience is so negative. It’s essential that effective post appraisals are performed in order to ensure this doesn’t happen.
Take the learning from the experience without allowing it to be the lens through which all future decisions are made.
Onboarding – It is essential that management does a great job onboarding new talent. Create, even during the interview process, an expectation that continuous learning is a critical part of advancement in the organization. Excellent companies probe for evidence of life-long learning in the talent they’re recruiting. Answers to questions such as “What was the last book you read?” and “Tell me about a time when an experience turned out poorly in terms of what lessons you learned.” are valuable indicators of the importance placed by applicants on learning. Once the individual joins the organization, it’s essential early on to make sure they know how dependent the company is on their making important observations about the company. As a relative outsider they are well positioned to point out inefficiencies and inconsistencies in the company. The vitality of the organization is enriched by such observations, made in a respectful way.
Lead – Leaders set the tone for how important learning is in the organization. You control the resources and you decide whether learning initiatives gets allocated its fair share. In particular, it’s not just your support for learning initiatives but working to ensure organizational learning from productive failures is occurring. Your team will be monitoring whether life-long learning is a slogan or something that gets an appropriate allocation of resources. Examine the actions in this article for ideas about things you can begin to implement today.
 Ikujiro Nonaka, Management of Knowledge Creation. (Tokyo: Nihon Keizai Shinbun-sha, 1990).
 Peter M. Senge, The Fifth Discipline (New York: Doubleday, 1990), p. 1.
 Ikujiro Nonaka, “The Knowledge-Creating Company,” Harvard Business Review, November–December 1991, p. 97.
 David A. Garvin, “Building a Learning Organization,” Harvard Business Review, November- July-August 1993.
 David Nadler, “Even Failures Can Be Productive,” New York Times, April 23, 1989, Sec. 3, p. 3.
 Robert C. Camp, Benchmarking: The Search for Industry Best Practices that Lead to Superior Performance (Milwaukee: ASQC Quality Press, 1989), p. 12.