The Learning Organization and Strategic Change
Rowden, Robert W., SAM Advanced Management Journal
Imagine that you are taking a journey into the mountains. The nature of the experience will vary considerably from one mountain range to another. There are two kinds of mountain ranges. One type, like the North American Rockies, is dominated by prominent peaks, their majestic summits rising silently and austerely above the landscape. The foothills and smaller mountains, dwarfed in the foreground, dramatize the formidable scale of the highest peaks. On a trip, the summit dominates the horizon, an endpoint against which progress can be easily gauged.
But there is another type of mountain range, such as the Cascades in the Pacific Northwestern United States, composed of gradually rising peaks, the size of one peak not revealing itself until the last one has been conquered, the summit being but one final stage in the gradual ascent.
Aesthetically, each has an elegance and beauty -- the first, awesome and inspiring, the second, mysterious and surprising.
Organizations also take journeys in their attempts to mount significant strategic change. Examples of these journeys include entering international markets, downsizing, forming strategic alliances, improving customer satisfaction, achieving quality improvements, pioneering new technical innovations, and introducing new products. Increasingly, a company's viability is being determined by its ability to make such systemic, organization-wide change happen, and happen fast.
Traditionally, firms have approached these journeys as if the business landscape resembled a mountain range like the Rockies. At the outset of the journey, the organization would scan the horizon and spot the summit. With the presumption of clear vision, it would set a goal and develop a precise roadmap to achieve its end target. Clouds of resistance, fog banks of shortsightedness, or storms of crisis might obscure the final destination now and then. However, the summit would still be reached if only the organization maintained momentum and stayed on course.
In the highly uncertain business conditions emerging in the early 21st century, the topography of the business environment might be more like the mysterious Cascades than the majestic Rockies. Clouds of swirling technological, competitive, marketplace, social, economic, and political changes obscure the final destinations. Until an organization takes some action and mounts the first hill, the size and scope of the next peak cannot be foreseen. Business environments are too chaotic and organizational change too complex to establish firm objectives, fixed plans, and concrete programs of change.
Amid sometimes unpredictable, always uncertain, and highly turbulent business conditions, an organization's capacity to learn as it goes may be the only true source of competitive advantage. No longer able to forecast the future, many leading organizations are constructing arks comprised of their inherent capacity to adapt to unforeseen situations, to learn from their own experiences, to shift their shared mindsets, and to change more quickly, broadly, and deeply than ever before. In other words, to become learning organizations. According to Kiechel, the notion of the learning organization is... a very big conceptual catchall to help us make sense of a set of values and ideas we've been wrestling with, everything from customer service to corporate responsiveness and speed (1990, p. 133).
The idea of the learning organization has been around quite some time. It derives from Argyris' work in organizational learning (Argyris & Scion, 1978) and is indebted to Revans' (1983) studies of action learning. It has roots in organization development (especially action research methodology) and organizational theory (most notably, Burns and Stalker's work on organic organizations). Its conceptual foundations are firmly based on systems theory (Senge, 1990a) and its practical application to managing a business has evolved out of strategic planning and strategic management (Fiol & Lyles, 1985; Hosley, Lau, Levy & Tan, 1994), which have recognized that organizational learning is the underlying source of strategic change (DeGeus, 1988; Jashapara, 1993). …