Influence of Organizational Learning on Organizational Performance from the Employee Perspective: The Case of Slovenia

Article excerpt

Organizational learning is considered to be one of the most important issues in modern managerial literature. Recently, it has been coupled with the question of organizational performance. The Stakeholder theory addresses organizational performance evaluation from multiple perspectives - shareholders, employees, customers and suppliers of a certain company. This paper focuses on the relationship between organizational learning process (Ol) and organizational performance from the employee perspective (Empp). We tested the hypothesis that higher-level organizational learning leads to improved organizational performance from the employee perspective. We used the sample data gathered by a self-administered questionnaire from top management members of 197 Slovenian companies with more that 100 employees in June 2004. Two constructs (Ol and Empp) were measured using nine measurement variables. Structural equation modelling methodology was employed. The results demonstrate the statistically significant, strong and positive impact of organizational learning on performance from the employee perspective. Companies which invest efforts into the systematic approach to organizational learning profit in terms of an augmented level of employee trust in the leadership, improved efficiency of work organization, a more committed workforce, decreased costs of work per employee, increased employee satisfaction and increased employee flexibility.

Received: 2. 6. 2005.

Accepted: 6. 2. 2006.

Preliminary communication

UDC: 65.01 (497.4)

1. INTRODUCTION

Organizational learning is considered to be one of the most important issues in modern managerial literature. In our view, it is important to address it in terms of organizational performance from the modern perspective. In this manner, the Stakeholder theory addresses organizational performance evaluation from multiple perspectives. It stresses the interests of shareholders, employees, customers, as well as suppliers of a certain company. This paper concentrates on the relationship between organizational learning process (Ol) and organizational performance from employee perspective (Empp) and attempts to evaluate the impact that the former has on the latter

Organizational learning has emerged as one of the most promising concepts in strategic management since the late 1980s. A leading researcher in the field of organizational learning stated? "the ability to learn faster than your competitors may be the only sustainable competitive advantage" (De Geus, 1988). This is why we have developed a conceptual model relating organizational learning to one important aspect of organizational performance - that is the employee perspective. In order to do so, we systemized and presented definitions and process of organizational learning. In addition, we have discussed the traditional and modern (Stakeholder theory and Balanced Scorecard) approaches to organizational performance measurement and, in this context, concentrate on the estimation of organizational performance from the employee perspective. We provided an empirical test as well.

This paper is divided into four main parts. First, the model is conceptualized by presenting the main constructs and the relationships among them, and formulating the hypotheses and operationalising the constructs of concern. Second, data analysis begins with parameter estimation. In this context the utilized sample is described and the hypotheses are tested. Third, the model fit at the global, structural and measurement level is assessed. Finally, the results are discussed from a modern managerial perspective. We conclude by exposing some limitations to our work and providing directions for future research in the area.

2. TOWARDS THE MODEL

Constructing a model means examining the existing theoretical basis for constructs of concern and establishing a framework for their operationalization. Empirical foundations for the influence of the exogenous on the endogenous latent variable are examined as well and a hypothesis for further empirical testing is formulated. …