Lecture 2 The Learning Organisation

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Lecture 2The Learning Organisation
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Learning Outcomes

• Review the evolution of Change Mechanisms
• Critically evaluate the concept of the Learning
  Organisation and Organisational Learning
• Develop an outline action plan to implement
  learning approaches within an organisation
• Assess the efficacy of adopting such approaches
  within an organisation

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Big Business Era of the 1970s

• Large organisations favourable for implementation
  of principles of Scientific Management - focused
  on organisation of manufacturing processes
• Application of Rational Management Practices
• Research and Innovation could be readily pursued
  - fragmented approach

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Characteristics of 1980s

• Flat decentralised structures
• Increased managerial responsibility - emphasis on
  strategy and implementation
• Reward of staff/employees related to performance
• Generation of customer/client focused culture
• Growing focus on systems perspective emphasized
  that everything is connected to everything else
  model business processes in terms of flows and
  feedback loops
• Peter M. Senge The Fifth Discipline Fieldbook

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Business Process Re-engineering

• Movement began in 1990
• Organisations must think in terms of
  comprehensive processes
• Processes needed to be conceptualised as
  complete, comprehensive entities that stretched
  from initial order to the delivery of the product
• I.T. needed to be used to integrate these
  comprehensive processes

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BPR Shortsighted

• Theorists underestimated difficulties of
  integrating corporate systems with I.T.
  technologies available at that time
• Failed to appreciate problems involved in scaling
  up some of the solutions they recommended
• People resisted major change
• Costs involved

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Misuses of BPR

• Downsizing popular in mid-1990s
• Introduction of technology led managers whose
  primary function was to organise information from
  line activities and funnel to senior management
  to become redundant
• Employee distrust
• Business Process Improvement
• Business Process Redesign

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Increasing Uncertainty Current Trends

• Global
• Society
• Organisational
• Individual

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Environmental Progression

• Science and Technology
• Global Competition
• Changing Aspirations of the workforce
• Increasing educational aims of developing
  countries
• Decrease in the life expectancy of an industrial
  enterprise
• Reduction in cycle times

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Uncertainty

• in an economy where the only certainty is
  uncertainty the one sure source of competitive
  advantage is knowledge (Nonaka, 1996)

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Knowledge Focus

• Knowledge is now being applied to knowledge.
  This is the third and perhaps the ultimate step
  in the transformation of knowledge. Supplying
  knowledge to find out how existing knowledge can
  best be applied to produce results is, in effect,
  what we mean by management
• Drucker, 1993

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Knowledge as an asset

• Knowledge has become the most important factor
  in economic life. It is the chief ingredient of
  what we buy and sell, the raw material with which
  we work. Intellectual capital - not natural
  resources, machinery, or even financial capital -
  has become the one indispensable asset of
  corporations (Stewart, 1997)

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A New Era?

• it has become common place to conceive of
  management, specifically entering or having
  entered a new era (Grey and French, 1996)

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Old Wine in New Bottles?

• Capital consists in a great part of knowledge
  and organizationKnowledge is our most powerful
  engine of production (Marshall, 1890)

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A Fourth Source of Wealth?

• Land, labour, capital and knowledge?
• Substance - knowledge, capabilities, skills,
  experience, aspirations
• Process - learning, thinking, feeling, seeing
  listening, innovating, creating

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Focus

• Efficiency
• Improving efficiency (closing gaps)
• Productivity
• Lower costs, higher revenues
• Short-term, operative

• Proficiency
• Culture shift (learning org)
• Processual
• Changes in behaviour attitudes
• Long-term, strategic

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Knowledge or Learning?

• we have entered the knowledge age and the new
  currency is learning - it is learning, not
  knowledge itself which is critical
• Dixon, 1999

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Adam Smith vs. Delia Smith

• we are moving into an economy where the
  greatest value is in the recipes, rather than the
  cakes
• Leadbetter, 2000

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Intellectual Assets

• a companys value derives not from things, but
  from knowledge , know-how, intellectual assets,
  competencies, all of it embodied in people
• Hamel and Prahalad, 1996

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Organisational Learning and the Learning Company

• Increasing recognition by academics and
  practitioners
• Multidisciplinary and fragmented
• Commercial interest in the area
• Organisational learning informed the idea of the
  learning company

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Organisational Learning Technical Perspective

• Effective processing, interpretation of, and
  response to information internally and externally
• Emphasis on interventions based on measurement
• Focus on outcomes not processes
• Information Systems emphasized

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Organisational Learning Social Perspective

• Making sense of experiences at work
• Combination of explicit and tacit sources
• Emerges from social interactions
• Learning from experiences
• Structured interventions dialogue
• Development of models linear and cyclical

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The Learning Organisation

• Where people continually expand their
  capability 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 to learn together
• Senge, 1990

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Disciplines of the Learning Organisation

• Systems Thinking
• Personal Mastery
• Mental Models
• Building Shared Vision
• Team Building

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Learning Disabilities in Organisations Senge,
(1990)

• 1) I am in my position - a narrow focus on
  ones job rather than on the purpose of the whole
• 2) the enemy is out there - blaming others when
  things go wrong, not recognising that in here
  and out there are part of the same system
• 3) The illusion of taking charge - the need to
  differentiate between being proactive and
  reactive
• 4) Fixation on events - focus on short-term
  events and not on slow gradual processes which
  are the real threat

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Learning Disabilities in Organisations

• 5) The parable of the boiled frog - the
  non-detection of slow gradual processes
• 6) The delusion of learning from experience -
  the impact of important decisions
• 7) The myth of the management team - cohesion
  versus conflict?

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without the separation of self and
environment, intelligence as we know it would
not have evolved, the scientific method of
analysis and understanding of a physical
universe separate from ourselves would not have
been possible, and the technological progress
from which we all now benefit immeasurably would
never have occurred. it is based on our
capacity to conceptualise and build shared
understanding of the larger systems which
determine individual actions. It is a path based
on the primacy of the whole rather than the
primacy of the part (Senge, 1993)
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The Learning Company

• At present we know a lot about providing
  individual learning - albeit in a training mode
  but our knowledge of how to gather together the
  fruits of all this individual learning to enhance
  the generic problem of solving capacity of the
  organisation is rudimentary. The great challenge
  of the learning company is to learn how this can
  be done
• Pedler et al, 1988

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Evolution of the Learning Company

• Stage 1 Surviving - companies that develop basic
  habits and processes and deal with problems as
  they arise on a fire-fighting basis
• Stage 2 Adapting - companies that continuously
  adapt their habits in light of accurate readings
  and forecasts of environmental changes
• Stage 3 Sustaining - companies that create their
  contexts as much as they are created by them, who
  achieve a sustainable, though adaptive, position
  in a symbiotic relationship with their environment

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The Learning Company

• an organisation which facilitates the learning
  of all its members and continuously transforms
  itself
• Pedler et al, 1988
• an organisation that facilitates the learning
  of all its members and consciously transforms
  itself and its context
• Pedler et al, 1997

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Members of the Learning Company Consortium

• Humberside TEC
• United Distillers
• TSB
• Digital
• Welsh Health
• Croydon Business School

• Rolls Royce Associates
• Smith Kline Beecham
• British Rail Intercity
• Mid Essex Health
• Coopers and Lybrand
• Ernst Young USA

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The Learning Company Framework

• Aspect
• Strategy
• Looking in (Internal Aspects)
• Structures
• Looking Out (External aspects)
• Learning Opportunities

• Elements
• 2
• 4
• 1
• 2
• 2

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Learning Approach to Strategy

• This characteristic encompasses company policy
  and strategy formation which together with
  implementation, evaluation, and improvement are
  consciously structured as a learning process.
  Key features of this characteristic include the
  fact that strategy is openly challenged,
  discussed widely and that a problem solving
  approach is adopted

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Participative Policy Making

• This refers to the sharing of involvement in the
  policy and strategy forming process. All
  employees have a chance to contribute to major
  policy decisions and thus the strategy reflects
  the view of everybody in the company

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Informating

• This characteristic considers the way in which
  information technology is used to inform and
  empower people rather than disempower them.
  Emphasis is placed on the use of systems so that
  relevant information is available in a user
  friendly form for everybody

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Formative Accounting and Control

• Part of information this has been given a
  separate specific characteristic because of the
  importance given to accounting and budgeting
  systems in most companies. Essentially financial
  systems should be easily understood and provide
  relevant information so that everybody is able to
  make appropriate business decisions

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Internal Exchange

• This characteristic involves all the internal
  units and departments being regarded as customers
  and suppliers contracting and co-operating fully
  with one another in a partly regulated economy.

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Reward Flexibility

• Within a learning company there may be
  alternative ways of rewarding individuals apart
  from financial reward. Emphasis in this
  characteristic is placed on recognising a job
  well done as well as openly discussing and
  sharing the principle behind the reward system,
  in whatever form, it takes.

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Enabling Structures

• In an increasingly competitive environment rules
  and structures within an organisation should
  remain flexible so that rapid responses to
  demanding situations are possible. The rationale
  for this characteristic is to create an
  organisation which allows current needs to be met
  as well as catering for future changes. Employee
  development creativity and flexibility are also
  emphasised.

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Boundary Workers as Environmental Scanners

• All members within a learning company will
  collect data from its external environment (i.e.
  all external customers, clients, suppliers,
  neighbours etc) so that all employees are
  providers of information. To allow the flow and
  exchange of this information throughout a company
  appropriate communication structures must be in
  place.

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Inter-company Learning

• In this characteristic companies, whether in the
  same industrial sector or not get together for
  the purpose of mutual learning known as
  benchmarking. By doing this the companies
  interests will be met - e.g. by aiding in
  technological advance or establishing joint
  industry standards.

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Learning Climate

• This characteristic emphasises the lack of a
  shame and blame culture. In keeping with this
  perspective one of a managers many tasks is to
  facilitate employees experimentation and to
  allow them to learn from their mistakes.
  Importance is attached to the idea of continuous
  improvement.

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Self-development Opportunities for All

• Resources and facilities for self-development
  are made available for all employees of the
  company. With appropriate guidance people are
  encouraged to take responsibility for their own
  learning and development.

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Fundamental Elements

• Importance of learning by individuals and
  companies
• Effective management and exchange of information
• Effective training and development of employees

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The 11cs Questionnaire

• Current (How it is) scale
• Aspirational (How I would like it to be) scale
• Maximum Score (7535)
• Minimum Score (155)

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Dissatisfaction (Opportunity) Index

• 100 Aspired state - current state
  Aspired
  State
• Range Zero - no gap between the states
  100 - maximum
  gap between the states
• The higher the opportunity index the greater the
  amount of dissatisfaction with a particular
  characteristic

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The EFQM Excellence Model

• This model has been redesigned to incorporate
  various elements including the recognition of
  the emerging importance being attached to the
  management of knowledge within organisations, the
  learning organisation culture, and innovation, as
  providing a key competitive advantage

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The EFQM Excellence Model

• Enablers
• Leadership
• Policy Strategy
• People
• Partnerships Resources
• Processes

• Results
• Customer Results
• People Results
• Society Results
• Key performance Results

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Enablers People

• How the organisation manages, develops and
  releases the knowledge and full potential of its
  people at an individual, team-based and
  organisation-wide level, and plans these
  activities in order to support its policy and
  strategy and the effective operation of its
  processes

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People Results

• Do people enjoy working in the organisation?
• Is there a high level of loyalty amongst the
  organisations employees?
• What do trends in productivity, absence levels
  and staff turnover indicate?
• Are employees keen to be involved in trying to
  improve the business?

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Tutorial Task

• Search on-line for five good websites relating
  to the Learning Organisation list the URLs
• Provide three definitions of Learning
  Organisation or organisational learning