Organizations can be described as continuous learning systems, and organizational learning has been defined by Marsick (1994: 28) as a process of: ‘Co-ordinated systems change, with mechanisms built in for individuals and groups to access, build and use organizational memory, structure and culture to develop long-term organizational capacity’.
Organizational learning strategy aims to develop a firm’s resource-based capability. This is in accordance with one of the basic principles of human resource management, namely that it is necessary to invest in people in order to develop the human capital required by the organization and to increase its stock of knowledge and skills. As stated by Ehrenberg and Smith (1994: 279–80), human capital theory indicates that: ‘The knowledge and skills a worker has – which comes from education and training, including the training that experience brings – generate a certain stock of productive capital’.
Five principles of organizational learning have been defined by Harrison (1997):
- The need for a powerful and cohering vision of the organization to be communicated and maintained across the workforce in order to promote awareness of the need for strategic thinking at all levels.
- The need to develop strategy in the context of a vision that is not only powerful but also open-ended and unambiguous. This will encourage a search for a wide rather than a narrow range of strategic options, will promote lateral thinking, and will orient the knowledge-creating activities of employees.
- Within the framework of vision and goals, frequent dialogue, communication and conversations are major facilitators of organizational learning.
- It is essential to challenge people continuously to re-examine what they take for granted.
- It is essential to develop a climate that is conducive to learning and innovation.
Single- and double-loop learning
Argyris (1992) suggests that organizational learning occurs under two conditions: first when an organization achieves what is intended and second when a mismatch between intentions and outcomes is identified and corrected. But organizations do not perform the actions that produce the learning, it is individual members of the organization who behave in ways that lead to it, although organizations can create conditions that facilitate such learning.
Argyris distinguishes between single-loop and double-loop learning. Single-loop learning organizations define the ‘governing variables’, ie what they expect to achieve in terms of targets and standards. They then monitor and review achievements and take corrective action as necessary, thus completing the loop. Double-loop learning occurs when the monitoring process initiates action to redefine the ‘governing variables’ to meet the new situation, which may be imposed by the external environment. The organization has learned something new about what has to be achieved in the light of changed circumstances, and can then decide how this should be achieved.