Organizational Learning and Environmental Change - Literature review Example

Running head: Learning Organizational Learning and Environmental Change ___________ ________________________ ________________ Organizational Learning and Environmental Change Introduction Organizations in today's world of global opportunities, which are made more dynamic abetted by mature high end communication and information technology, are faced with survival challenges as the base objective and robust growth as the cherished objective. In fact there is no department of any commercial organization that is not presented with a veritable change routinely or encounter questions and facts which involve dynamic learning. Organisations are fast transforming themselves into global information systems highly akin to electronic brains. Paperless and automated offices and factories-once a matter for ideal state fiction are now reality. Still most of this is still commandeered by human intelligence however, networked computing is able to reap efficiency and outputs undreamt off earlier.Often new concepts are ignored till the time they translate into competitive disadvantage. This paper examines the various approaches to learning which an organization can adopt so that learning challenges in environment are not only recognized right in time but also ingrained into the operations of the organization and reflect in employees' learning to derive competitive advantage. This paper eamines the relevance of the Revans formula which emphasizes the importance of keeping pace in the learning process. Importance of Learning in an Organization All organizations can be viewed as offering some kind of solution to the problems of their stakeholders in the widest and deepest marketing sense. An essential blueprint for the organizational survival is derived from the writing of Revans(1980,1982) . Revans(1980) posited that in order for an organization to succeed the learning(L) within an organization must be greater than or equal to the rate of change(C)in the environment (L C). This is called the Raven formula. This concept maintains that organisations must become 'learning organisations' if they are to survive the changes in the external environment that affect the business and its' operations. Revans recommended action learning to essentially mean removing the gap between ideas and actions, between thinking and doing, action and learning as parts of each other. Revans coined the phrase," "helping each other to help the helpless" .Revans philosophy is based on three concepts of honesty about self, all knowledge ought to be action oriented and most action should lead to camaraderie. An immediate example can prove Revans theory in relation to stakeholders of any organization. Organization like airlines -offering the services of air travel-were faced with a new and emerging niche of customers who were upwardly mobile professionals with high spending powers in early 1990s.This new niche of customers which emerged from the airlines environment was a result of prosperity brought about by globalization and opening up of economies and international markets. These travelers did not merely have an expectation of basic air travel need from airlines but expected a host of value additions in terms of menu, behaviour, off board facilities etc.Successful airlines that read into the trend and honestly went about implementing the necessary marketing plan reorientation through concrete actions like altering inflight menus, increasing airport facilities, changing the seats and space ,training the employees and above all instilling a team spirit while bringing about this overall change emerged as the best airlines of the world while others lagged behind. A living example is Singapore Airlines. The Revans formula worked secretly behind these success stories in that such airlines ensured that the rate of the organizational learning process was greater than that posed by the changes in their environment. Thus the employees of the organization, not following Revans formula would be having a learning memory that is far behind the one that has occurred in the organization's external environment. Competition which is more adept at environmental scan and learning would walk away with customers and stakeholders. Ideally the organization should not only reckon such changes but also make plans to deal with them so that their solutions remain most current and attractive. So This is what is rapidly occurring in the modern world- as times change, organisations of today face rapid change faster than ever before (Mabey & Iles 1994). Markets are becoming diversified and differentiated, causing high competitive pressures for organisations. (Salaman & Butler as cited in Mabey and Iles 1994). Organizational theory that had come under the influence of the machine metaphor and bureaucratic traditions is enlivening with the concept of an organism metaphor and learning capabilities of an organization as Morgan(1997) says, "Under the influence of the machine metaphor, organisation theory was locked into a form of engineering preoccupied with relations between goals, structures, and efficiency. The idea that organisations are more like organisms has changed all this, guiding our attention toward the more general issues of survival, organisational environment relations, and organisational effectiveness. Goals, structures and efficiency now become subsidiary to problems of survival and other more 'biological' concerns."Dynamic environment can make this process essential for survival. As Vaill(1997) says,"It is hardly an exaggeration to say that sooner or later, every organization has to deal with every other kind of organization and stakeholder that there is. No longer, if it was ever true, can a business just expect to deal with businesses in its primary industry and with a known and stable set of suppliers and customers. The "public interest," with which a government agency is concerned, is an increasingly heterogeneous collection of organizations, individuals, and other entities - all with differing missions, core technologies, operating structures, and work content. Health systems, voluntary organizations, educational institutions, professional services firms - they too are finding that in order to pursue their own missions they have to be knowledgeable about an extraordinary range of issues, trends, and opportunities in their environments. Furthermore, all this variety is itself in a process of continual change and evolution in unpredictable directions. One need only contemplate the significance for any organization of three such diverse trends as the Internet, multiculturalism, and the collapse of the Communist bloc: with relatively little warning to ordinary civilians, these three trends broke across the organizational world with great speed, complexity, and impact. No managerial leader could do anything but attempt to learn as best he or she could the significance of events such as these for one's organization and its future." Kotter (1990) defines that the role of the leadership is about invoking movement and causing some sort of change to occur whereas management is more about seeking order and stability. Rost (1996), as cited in Northouse (2004), concurs and explicates that the process of management is directed at co-ordinating activities with a view to getting a job done. He continues by stating that leadership, on the other hand, 'is concerned with the process of developing mutual purposes.' (2004: 9) Overcoming complacency is crucial at the start of any change process, and it often need a jolt of surprised shock which may be even mild, something that grabs attention at more than an intellectual level. One needs to surprise people with something that disturb their view that everything is perfect. Successful change leaders illustrate to people what the problems are and how they can be resolved. They use tangible things and innovative experiments that people can see, hear, or touch. This may mean showing a video of an angry customer rather than a report of a customer survey. Change leaders make their points in emotionally engaging and compelling manner so as to obtain focused attention of the listener and learner. They rely on vivid stories that are told and retold. You don't have to spend a million dollars and six months to prepare for a change effort. You do have to make sure that you touch people emotionally (Kotter, 2003). For instance the transformational management supports the creation of a learning environment in the organization .It comprises in the creation and inspirational articulation of a compelling vision and a clear set of organizational goals or missions, which give meaning to all sets of activities throughout an organization. A substantial portion of a transformational approach's emphasis may be on transcending self-interests in an ideological framework[honesty of Revans formula] (Chaffee, 1985; Mintzberg & Waters, 1985) to get employees to ingrain and pursue organizational goals [camaraderie of Revans formula](Bass, 1990). The use of symbols and metaphors also may be central to this process (Conger & Kanungo, 1988). The chief activity of top management in the transformational process is to motivate and inspire organizational members [action orientation of Revans formula](Nonaka, 1988) toward organizational goal attainment. Their main attention is on bringing workers together for the common purposes at hand[again camaraderie amongst the employees] (Grandori, 1984; Mintzberg, 1987) and developing and maintaining continued efforts toward the shared values (Bourgeois & Brodwin, 1984) and emotionally appealing corporate vision. This vision and culture would be the one which could be reported as part of corporate governance by any organization. This corporate vision and culture carries an important ingredient. It is comprised of a system that leads to regular and routine learning about environmental changes-whatever may be their magnitude. Such a system becomes essential as such changes warrant a revision of organizational objectives and tactics and sometimes may even result in realignment of the organizational vision and culture. As Vaill(1997) says that ," One is looking at a human being facing in real time a condition that is problematic for the organizational objectives the person is pursuing. The objectives themselves may be changing, and the problematic condition may be changing as well[this is essentially putting Revans formula in perspective in that changes in environment bring about changes in organizational objectives in order to initiate learning process to exceed the changes]. The person's intent is to understand this evolving problem well enough so that human, financial, and physical resources - themselves undergoing various kinds of unpredictable and barely controllable change - can be organized and mobilized (that is, led) to address the problem; all this is going on day after day, year after year, in connection with everything the person gets involved in. Of course many different attitudes and abilities come into play in this process. But learning abilities pervade the process. They are of primary importance, because on them depend the person's ability to adapt whatever other behavioral skills he or she possesses to the evolving situation. Managerial leadership in this view is never really learned; it is ongoing learning". This transformational approach is quite popular. It, in fact, is found under differing names in works of various authors. For instance: the transformational approach rings similarity in Mintzberg and Waters' (1985) ideological approach to strategy making, Bourgeois and Brodwin's (1984) cultural approach, Grandori's (1984) cybernetic approach, Chaffee's (1985) interpretive approach, Mintzberg's (1987) perspective approach, Nonaka's (1988) compressive approach, and Hart's (1992) symbolic approach to strategy making . A Learning Organization Morgan(1997), in his book Images of Organisation states that , "Effective managers and professionals in all walks of life have to become skilled in the art of 'reading' the situations they are attempting to organise or manage".This is a statement of a learning attitude.A management that has eyes and ears open must also have the alacrity and system to churn in new information collected and arrive at effective decisions.This learning has to be with a systematized feedback lop. Morgan (1997) gives out emphatic reasoning for such opening of management to new information when he says," as we enter the twenty-first century we find bureaucracies and other modes of mechanistic organization coming under increasing attack because of their rigidities and other dysfunctional consequences .... Now that we are entering an age with a completely new technological base drawing on microelectronics, new organizational principles are likely to become increasingly important". Tendencies to form staid systems that are either bureaucracies or resemble bureaucracies can delay decision making and obstruct learning. Morgan ,is in fact recommending that bureaucracies may affect leaning process in response to environmental change and the rate of learning may lag behind rate of change. Pearn, Roderick and Mulrooney (1995) opine that organizational learning theory is informed of and enriched by actual experiences which might occur in relation to an organization. Thus theoretical prescriptions of a initiating a system of learning, with in an organization, can be best used only to begin the process and the final system itself has to learn from experiences in order to retain functional utilities. Thus an organization has to ensure real learning and not be satisfied by just beginning a routine training system which has theoretical orientation without undergoing any updating from changing environment. This is in fact restatement of the honesty expected in learning in Revans formula.Pearn, Roderick and Mulrooney (1995) have also given the values which are essential to be comprehended before any meaningful learning system can address the organizational workers. These values are a combination of study of human behaviour and motives. They state that most workers are propelled by the prospect of self control over their affairs and their immediate environment; failure to harness people's intelligence and wisdom is and act of callous waste of precious resources;it must be recognized that left to their own most workers organize their work akin to the way they organize their lives wasteful in the extreme and people have important concepts of self and respond with high motivation to any positive treatment with dignity. These values indicate that empowerment of staff may be a viable concept in fostering learning in an organization. The empowerment idea is not a new one. Its spirit and intent have been expressed earlier under the rubrics of participative management, management by objectives, and even delegation of authority. Driving decision-making authority to the lowest possible level was one of Tom Peters' original eight principles by which excellent companies manage themselves (Peter and Waterman, 1982).A word of caution regarding empowerment-the concept is to be restrained and disciplined .Empowerment does not mean exercise of free will away from organizational objectives. In fact empowerment is to be woven with a clear understanding and an action orientation(following Revans) to attain organizational objectives. After the learning system has been put in place it is easy to distinguish a learning company from a indifferent and mechanistic company. Pedler, Burgoyne and Boydell (1997), in The Learning Company, provide eleven characteristics of a learning company as follows: where learning approach to strategyis comprised in forming policy and strategy consciously for learning(honesty of Revans construct); it has participative policy making where all members of the organization together with key stakeholders contribute and participate in policy making;in a learning company information technology is not just used to routinely automate but its object is to empower frontline staff to take informed decisions (action orientation of Revans construct); systems of budgeting, reporting and accounting are structured to assist learning; all internal units and departments see themselves as customers and suppliers in a supply chain to the end user or client; with participation increased to higher levels comes the need for flexible reward system and a learning company has such a system; roles, departments, organization charts and even procedures and processes are seen as amenable to dynamic change to meet job, user or innovation requirements; environmental scanning is carried out by all people who have contacts with external users, customers, suppliers, clients, business partners, neighbours and system exist to welcome new information;such company also learn from other companies;they foster a learning climate where managers view their primary roles as facilitating experiments by staff and institutionalizing successful results and sch learning companies set aside substantial resources for self development, training and retraining with emphasis on self motivation. Conclusion The above indicates that the Revans construct is not only valid in the globalized and fast changing world of today but has assumed more importance than ever before. It works to instill honesty, involvement and professionalism to the task of organizational survival through the most involved concept of learning. An organization is not simply the sum of its members. An organization comprises its members as well as their relationships and their empowerment to work together. An organization can have talented members who are not empowered and guided to make their highest-value contributions. It is very important that all leaders and members understand, embrace, and support learning, but that is not enough for the organization to learn. An organization learns by building learning into all aspects of work, planning, and relationships with stakeholders. 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