Gaining Competitive Advantage through Organizational Learning

By Vowles, Andrew | CMA - the Management Accounting Magazine, April 1993 | Go to article overview

Gaining Competitive Advantage through Organizational Learning


Vowles, Andrew, CMA - the Management Accounting Magazine


Not just a passing fad, organizational learning is the ticket to ride in the '90s -- and the management accountant needs to play a pivotal role.

To Alain Gauthier's mind, the competitive organization of the '90s will be the learning organization. He's not just talking about an organization that can quickly assimilate masses of information or that can react quickly to change, as useful as those attributes are. By his definition, a true learning organization is one that holds up a mirror to itself to repeatedly question why it does things in certain ways, one that continually probes at its own basic assumptions about the way things work in order to improve them. And asking many of the tough questions -- holding up the mirror -- is a natural role for one member of the organization particular: the management accountant.

Why the need for this corporate soul-searching? In a word: competition.

According to Gauthier, founder and executive director of Core Leadership Group, a leadership development consulting firm in Oakland, California, no organization will make change unless it has to. Today, however, few organizations have much choice in the matter. Thanks to any number of well-documented external forces such as freer trade and the push for productivity, organizations must continually refine the way they do business just to keep up with their competitors. For Gauthier, organizational learning is a company's ticket to doing so: "The learning organization is an organization that continually expands its capacity to re-invent or renew itself."

He's the first to acknowledge that the concept of a learning organization isn't his. Rather, it comes from Peter Senge, director of the Systems Thinking and Organizational Learning Program at the Massachusetts Institute of Technology's Sloan School of Management. He outlined his ideas in his 1990 book, The Fifth Discipline: The Art and Practice of the Learning Organization. Gauthier, who recently directed the book's French translation and adaptation, will discuss the learning organization as a feature speaker at the national conference of The Society of Management Accountants of Canada on July 5.

In order to become a learning organization, Gauthier says, a company must first identify its learning disabilities. What factors prevent it from anticipating and preparing for change? According to The Fifth Discipline, there are seven major roadblocks to organizational learning, as follows:

I am my position. As people focus on their own jobs, they become blinkered to other positions, and fail to see the fallout of their actions elsewhere in the organization.

The enemy is out there. When problems crop up, individuals automatically blame others in the organization rather than compromise their own position.

The myth of proactiveness. "Taking charge" is mostly illusion. People believe they are being proactive when often they are only reacting to circumstances.

Failing to recognize gradual threats. While people are quick to recognize sudden threats, many fail to see more gradual problems arising until it's too late.

Illusion of learning from experience. "Learning from experience" does work, but only when the consequences of actions are readily apparent. Because the results of strategic decisions only appear in the future, few people actually get the chance to experience and learn from them.

The myth of the management team. Stated baldly, management teams often don't work. People can actually prevent one another from learning, resulting in poor decisions or watered-down consensus.

Fixation on events. People focus on single recent events and actions, and miss the broader connections among them.

Gauthier explains that, in order to overcome these disabilities, a learning organization's members must practise in tandem five major disciplines: building shared vision; personal mastery; team learning; mental models; and systems thinking. …

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