Notion of organizational learning


This is one of those rare times in history when members, managers as well as students of organizations are unanimous on the importance of organizational learning (Argyris and Schon, 1978). In this fast age of internet; political, economic, social and technological (PEST) environments change too rapidly. As a result organisations always live in an unstable environment and they feel the need for organizational learning as a continuous and endemic process.

The notion of organizational learning and its link to performance is widely accepted but a review of management literature reveals lack of consensus on a formal definition (Fiol and Lyles, 1985,pp. 803). Some theorists refer to organisational learning as new insights or knowledge (Hedberg, 1981, Argyris and Schon, 1978), some as new organisational structures (Chandlar, 1962) and new systems (Jelinek, 1979) and some as mere actions (Cyert and March, 1992, Miller and Friesen, 1980). A few other theorists define it as a combination of all of the above (Bartunek, 1980, Shrivastava and Mitroff, 1982 )

'Although these definitions vary in their description of organizational learning' (Lopez et al., 2006,pp. 217); but all of these agree on organizational learning as a process which develops new knowledge or insight for a firm (Chiva and Alegre, 2005). Final goal of any organization is long-term survival and sustained growth through performance. To achieve performance organizations must remain competitive, innovative as well as aligned to their changing environments (Barnard, 1938 , Lawrence and Dyer, 1983, Thompson, 1967 ). 'Alignment implies that the firm must have the potential to learn, unlearn, or relearn based on its past behaviours.' (Fiol and Lyles, 1985, pp. 804)

'Organizations learn by encoding inferences from experience into organizational routines, standard operating procedures and other organizational rules' (Holmqvist, 2009, Kieser et al., 2001, Schulz, 2002). Lave and Wenger (1991) explain organizational learning formally and specifically as an organized individual experiential learning process.

Organisation learning literature describes two schools of thoughts. The situated learning school (Brown and Duguid, 1991, Gherardi et al., 1998) emphasizes that people in organizations learn all the time. Tacit knowledge is passed and learning happens through informal practices in the workplace and by people's everyday interactions with one another. Existing communities of practice shape the learning experience of new recruits and other employees through passing on. (Shipton et al., 2002)

In the second school of thought, Huber (1991) stresses on the importance of three processes of

  • knowledge acquisition: the process of developing new skills, insights or relationships
  • knowledge sharing: dissemination of what has been learned (Nevis et al., 1995)
  • knowledge utilization: integration of learning so that it can be generalized to new situations.

In both schools of organisation learning; individual employees play a fundamental role (Lopez et al., 2006). Organization would not exist without them. Therefore, HR systems can contribute to organisation learning, by facilitating the development of competencies that result in 'complex social relationships based on the company's history and culture, and generate tacit organizational knowledge' (Barney, 1992, Wright and McMahan, 1992, Lopez et al., 2006)

Organisational learning

Organisation learn nothing if fresh exigent arise, yet employees fail to take remedial action (Bateson, 1973, Snell and Chak, 1998). Single-loop (thermostat learning) learning is like a consolidation process, that is, changes in the organization's knowledge and competency base without questioning or altering present policies, objectives or mental maps (Snell and Chak, 1998). Double loop learning involves modification of an organization's underlying norms and policies while detecting and correcting errors (Argyris and Schon, 1978,p 3). A thermostat which detects and corrects room temperature without questioning is single-loop learning. If the thermostat also asks why it was set at 65 degrees, or why it should be measuring heat, that would be double-loop learning (Argyris, 1980). There is also a third kind of learning involving structures and strategies, so-called deutero-learning (Bateson, 1973) or triple loop learning (Flood and Romm, 1996). 'Triple loop learning manifests itself in the form of ``collective mindfulness'': members discover how they and their predecessors have facilitated or inhibited learning, and produce new structures and strategies for learning.' (Romme and Witteloostuijn, 1999)

Organisational leaning can occur at many levels. According to Cangelosi and Dill (1965), learning occurs at individual, group, and organizational levels. Since then (1965), theorists have not arrived at much consensus about the appropriate level(s) of OL. (Crossan et al., 1980)

Simon (1991,p. 125) gives an apt interpretation of organisational learning at individual level, stating: 'All learning takes place inside individual human heads; an organization learns in only two ways: (a) by the learning of its members, or (b) by ingesting new members who have knowledge the organization didn't previously have'.

Daft and Weick (1984) assert that organisational learning would be incomplete if no information were shared and no common meaning developed. He asserts that learning is group based, occurring in a social context.

Several other theorists like Fiol and Lyles (1985) and Shrivastava (1983) say that organisations also have a role in organisational learning apart from individuals and groups. According to Hedberg (1981), 'the systems, structures, and procedures of the organization are the repositories for learning which form memory of the organization that persists even when individuals leave.' (Crossan et al., 1980)

A fourth kind, inter-organizational learning in mentioned in works of theorists such as Pucik (1988) and Inkpen and Crossan (1995), who examined OL in joint ventures and alliances.

How the learning at any level translates into action is also critical area of debate in OL theory. Cognitive theorists assume that a change in thought processes (unobservable) is also learning, even if no changes in observable behaviour. Behaviourists identify learning only in an observable change in behaviour, even in absence of any previous thought process. However, there is no dispute that both cognitive and behavioural learning occur in "integrated learning". And "no learning" occurs in absence of both cognitive and behavioural change. (Crossan et al., 1995) (Check Appendix 1 also)

Although, individuals and groups interpret and integrate information and knowledge, yet organisations often benefit from institutionalization, in which the learning (cognitive or behavioural) becomes embedded in the design of the systems, structures, and procedures of the organization and in the wider organisational culture. (Crossan et al., 1980)

Link between organisational learning and HRM

The theories and literature of in this field state that organizational learning and individual learning is not the same thing. There is something paradoxical here. Organizations are not just aggregation of individuals, yet no organization can survive without them. Similarly, organizational learning is not just individual learning, yet organizations learn only through the experience and actions of individuals. (Argyris and Schon, 1978)

Individuals possess the ability to understand and reach conclusions about important issues in their jobs and to communicate these to others (Shipton et al., 2002). The interaction of individuals through formulated processes and frameworks of HRM create new knowledge and adds to the pool of organizational knowledge that acts as the catalyst for the organization's growth and learning capability (Tempest, 2003).

As Senge (1990,p. 4) puts it, 'the organizations that will truly excel in the future will be the organizations that discover how to tap people's commitment and capacity to learn at all levels in an organization'.

In organisations, four contextual factors which affect the probability of learning are: corporate culture conducive to learning, strategy that allows flexibility, an organizational structure that allows both innovativeness and new insights, and the environment (Fiol and Lyles, 1985). All these factors are prerogative of Human resource management (HRM) domain. Gardiner and Whiting (1997) also indicate a new emphasis on the individual employees in organizations and a consequent need for facilitative and soft management styles. It is advised that the traditional functions of HR practitioners may be modified to encourage organisational learning.

HR Perspective

HRM manages 'all things human' in an organisation like recruitment, selection, training and development. 'Human resource management policies directly influence and are influenced by corporate culture' (McAfee et al., 2002). HRM determines the policies and frameworks in which processes and individuals interact in organisations.

Grieves and Redman (1999,p. 90) suggest many features of HRM which can and should support the learning approach. In learning organisations, both promote the idea of employee-driven learning. Individuals determine their own learning needs which are then facilitated through managers. Both promote employees to be independent and proactive self-managed learners.

All learning organizations advocate work based training/learning rather than off-the-job training courses. HRM actively promotes work-based learning and in some cases by making it compulsory (Roberts and Cocoran-Nantes, 1995). Another feature common to both HRM and the learning organization is the relinquishing of responsibility for employee development from senior to line managers. Traditional hierarchical structures inhibit employee creativity, communication, speed of response, and learning. Instead, leaner, 'organic' and flatter structures are much favoured, which emphasise on commitment to organizational values. This change in management style means 'unlearning' the management role of the past which promoted 'control' (Burdett, 1991, Leigh and Maynard, 1993). There are a number of HR activities which are relevant to the promotion of organisational learning.

Employee Participation

Most literature on organizational learning recommends a high level of participation. They argue that employee involvement, commitment and job satisfaction are all prerequisites for any learning. Individual members of an organization do not have any opportunity or the motivation for learning, without a significant level of participation (Dixon, 1994). It is unrealistic for the managers to expect employee contribution, commitment, creative ideas or knowledge, when they only have a passive role in the organisation. Realistically, Marquardt and Reynolds (1994 ) promote 'empowerment' as one of the mandatory components in learning organizations. Empowered people have the sense of power and authority, which motivates them to explore and learn new ways.

HR managers must ensure the establishment of a culture where employees are given more authority, freedom, learning opportunities and chances to make decisions; in short 'empowerment'.


Recruitment and retention of good employees is the most important activity of human resource management of a learning organisation (Davenport, 2000). Organisations can't expect employees to work creatively and learn new things if they recruit people to fit with their current norms and practices. Learning organizations need to recruit new employees who'll contribute to the organisational learning (Armstrong, 1995). New ways of thinking can be introduced in organisations by recruiting people from outside, into key positions (Ulrich et al., 1993 ). Such people are most likely to question accepted practices and try out new ways which promote learning, both individual and collective.


By a human resource perspective, selection is a process of matching candidates to current job/post requirements. However, learning organization must select employees for their ability to learn, desire to look at problems in new ways, a desire to share ideas, and being responsible for own decisions. The HRM practitioners should clearly decide the criteria against which candidates are selected. (Gardiner et al., 2001)


Training is one of the most important HR practices that can support organizational learning (Ulrich et al., 1993 ). In learning organisations, individuals define their own training needs and strive to align it to company objectives. Strategic training develops a culture of commitment to learning. 'Training should be seen also as a fundamental tool that facilitates communication among employees, by providing a common language and a shared vision'. (Lopez et al., 2006)


Studies have found strong links between reward systems and employee behaviour and commitment to learning and organisational values. Williams et al. (1993) claim that strong cultural messages can be communicated in this way. On the other hand, Iles (1994) points out that it is futile to recruit new staff for their creative and learning abilities; but then rewarding or promoting them for adhering to established ways of working and playing safe.

In most organizations today, people work in teams which make it difficult to argue a case for individual reward and remuneration. However, individualized reward systems still persist in some organizations (Baron, 1994). For example, sales staffs in most companies are usually rewarded on individual performance. Most 'learning organizations' promote the sharing of knowledge, ideas and outcomes based on collective performance. HR developers should support principles of learning by aligning both monetary and non-monetary reward structures, with teamwork and group performance.

Performance management

'Unfortunately most performance systems encourage doing business the same old way' (Belasco, 1990,p. 151). They reward conformity and efficient execution of organizational routines. This kind of behaviour may be appropriate to single loop learning but not for generative learning, which learning organizations aspire. Organizational learning perspective emphasises on development of potential rather than focusing only on tangible past results.

Learning organisations are now using appraisal interviews as a method of reaching agreement between the employee and his/her line manager on individual performance needs. They focus on opportunities to explore learning needs and map future career paths rather than evaluating the past deeds. One of the premises of learning-orientated organizations is that their members assume responsibility for what they want or need to learn, and Managers help them.

The task for the HR practitioner is to facilitate this process and ensure that a participative approach to determining performance is supported by other aspects of the corporate culture.

A Critical view

Any organization cannot be managed effectively without routinization of processes and activities (Argyris, 1980). Yet, the managerial approach taken to make sure routines work and things are in control may inhibit the generative learning process. However, learning is crucial to the long-run success and survival of the organization. This dilemma is built-in any organisation and can't be done away with. Thus, organizations need senior managers, who can cope with this dilemma and yet facilitate learning.

'The managers themselves face the learning dilemma: they are enthusiastic about learning and continuous improvement yet are often the biggest obstacle to its success' (Argyris, 2002). They seem to support participation and empowerment only until they don't lose any control (Poole and Mansfield, 1992). Empowerment is highly stressed in organisational learning literature but it's not so welcome in older hierarchical organisations. Most managers in such organisations mistrust participation and empowerment as they fear it might erode their own positions.

Some researchers conclude that participation/empowerment schemes lead to increased stress (Geary, 1995). Employees' feel little increase in control over their work process and organization. There is no significant up-skilling, work remaining barely as they were. Employees in some organizations are asked to learn new things, work harder and take greater responsibility without any significant increase in reward or remuneration. Such learning initiatives have little impact on employees' commitment and employee- management trust (Gardiner et al., 2001). Parker and Slaughter (1988) describe these consequences as 'management by stress'. Crosby (1992) argue that employee participation is in essence management's tool to achieve greater control over the workforce by enabling individuals to take decisions. Employees' existing power is then channelled for the benefit of organization. Employees may also be reluctant to assume responsibility for decision making or outcomes in changing/challenging environment (Plunkett and Fournier, 1991).

'In recent years there has been disillusionment with the apparent over simplification of the whole process of achieving transformational change' (Shipton et al., 2002). Many theorists such as Sloman (1999) and Woodall and Winstanley (1998,p. 150) have expressed concerns over an unbridgeable gap between theory and practice in this domain.

Dyer and Reeves (1995) put forward the concept of 'bundling'. Bundling means that HRM activities/initiatives which occur in 'mutually reinforcing, synergistic sets' (or bundles) are more effective than individual components. HRM initiatives for empowerment and organisational learning make a positive contribution only in situations where they have been designed and implemented in a mutually supportive way. 'For example, reward systems need to recognize the coaching and mentoring skills of managers if there is a policy for making use of this particular type of employee development' (Shipton et al., 2002).


Most organisations these days focus on promoting and facilitating learning as a central activity. The theories of organization learning promote increased employee participation in organisational processes, empowerment and a 'softer' management approach to the formulation of business strategy. However to accommodate this new thinking, to allow greater integration of learning and work and to accommodate employees' personal needs of training and development; the conventional styles of management may have to be changed radically. The task for human resource professionals is to oil the wheels of these processes. (Gardiner et al., 2001)

HRM can do this via a number of activities: first, granting employees more power and autonomy to fully explore the learning opportunities, with managers relinquishing control and acting as facilitators/helpers. Second, recruitment and selection policies should be altered to look for learning abilities in the new staff, rather than fit for the role. Third role of HRM is to facilitate appropriate organisational culture. A culture which shares the values of a learning orientation; which promotes new ideas and radical thinking, values diversity and encourages employee participation in policy making. However, to be able to participate, share and utilise knowledge, individuals need to have the opportunity to interact, and discuss their 'mental models' with others openly. Motivation for this comes from appropriate polices of performance and reward management, a learning organisational culture and possibilities for career progression (Shipton et al., 2002). Thus, it's natural to think that human HRM issues are significant for a learning system to operate effectively.

Organizational learning will prove to be even more essential as organizations face permanent "white water" (McGill et al., 1992). Regrettably, many organisations focus their attention on "adaptation". They practice adaptive learning, and even reward it. Generative learning in many ways works against such cultures of adaptive learning and 'management by control'. So the first step would be the process of "un-learning" previous mindsets which is a difficult task in itself and a change in existing culture of such organisations. Thus, this is the opportune time for HR managers to shift focus from the traditional emphasis on personnel management functions, towards a bigger role of facilitators and negotiators. However, learning in organizations should be the focus at all levels from the shop-floor to senior management. HRM should not be considered solely responsible for such grand task; the responsibility ought to be a shared one: at every level within the organization.


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