Building a Learning Organization: Understanding the Two Types of Organizational Learning

Are you tired of repeatedly fixing the same old problem? Are you tired of the old “command- and-control” style of managing? Are you tired of making every decision in your organization? You may be ready to try a different approach. If so, prepare to join the ranks of those special few companies that have created a “learning organization.” If you accept this challenge, your goal is to create an organization in which people solve their own problems and solve them once, not again and again. Choosing the correct way to approach problem- solving (or as management consultant Jerry Weinberg defines it, “problems-solving”) is the first step toward becoming a “learning organization.”

The term “learning organization” came into management vernacular in the early 1990s. U.S. companies were struggling against global competition and their own ineptitude. Hierarchical organizations, with top-down decision-making and huge bureaucracies, were not meeting the needs of the company, the customers or the employees. Workers were becoming more knowledgeable and wanted to contribute to the success of the organization. Smart managers realized that members of their company were always learning, and successful enterprises were learning organizations. In other words, people should learn from problems and from the act of solving problems.

When viewed in this light, it is simple to see how a learning organization differs from the old hierarchical organization. In a learning organization, people learn from mistakes and use them as opportunities to improve systems, processes and structures. In traditional organizations, managers confuse problem-solving with management. Managers should focus on improving systems in order to ensure their subordinates can do their work effectively. Riding in on a white horse and fixing the same problems repeatedly is not management, it is problem-solving. Problem-solving is a good management skill but not the only one. Creating a learning organization is hard work. It requires a different mindset and a new paradigm. Old mental models become part of a company culture. People resist change, managers see their authority threatened, and sometimes it is just plain easier to fix the immediate problem and move on.

In reality, there are no organizations, there are only people who make up the organizations. Organizations comprise people working together to achieve objectives. In the final analysis, organizations do not learn, people learn. The more the culture supports learning, the more often the problem is solved the first time rather than solved repeatedly. Therefore, the corporate culture plays an important role in a manager's ability to create a learning organization. It should smooth the process, not inhibit it.

Organizational leaders must be able to differentiate between two kinds of learning which occur in an organization: the coping, or adaptive, style and the generative style. Coping, or adaptive, learning is the style used in many organizations because it is easy, produces immediate results and rewards the problem-solver. Unfortunately, it fosters the habit of fixing the same problem again and again. Same problem, different solutions. Instead of looking for root causes, the adaptive manager exercises authority, blames the participants and saves the day.

On the other hand, a manager using a generative learning style finds a way to generate a long-term solution to the problem. He fixes it once and, at the same time, improves the system or process of work so the problem does not persist. The solution becomes a vehicle for learning and for fixing the system, not just saving the day.

Examples of Two Kinds of Learning

To illustrate the way managers in organizations apply the different types of learning, let's look at some examples. In the first one, picture yourself in a store, waiting for service. The counter is unoccupied, the store is quiet, and two clerks are standing off to the side stocking shelves, rearranging stock or simply engaging in a jolly conversation about their weekend activity. In frustration, you seek out a manager, she apologizes profusely, personally rings up the sale, smiles and sends you on your way. As you leave the store, you catch the manager admonishing the clerks to “get back to work and take care of the customers.” A week later, you are in the store again, and the same pattern evolves — same manager, same two clerks, same problem and same solution!

The manager did what many in organizations think that managers should do, she solved the problem. The problem; however, was not solved for the long term. The work process and system remain unchanged, and the problem will resist permanent fixing.

In distribution, we see the same adaptive style of learning in the warehouse or in an order input system. In the warehouse, the manager puts two very similar products close to each other in the picking line. Relying on sight picking, the warehouse worker, in an effort to keep his productivity in line with expectations, keeps picking the wrong product. Actually, the best the company can hope for is something above a 50 percent accuracy rate. Instead of moving the products or improving the process, the warehouse manager admonishes the worker to “be more careful.”

Another example focuses on a sales manager who wants to build the sales of widgets. In the meantime, a supplier rep offers her a supplier-funded sales incentive to sell whatnots. The manager, rationalizing that it is not the company's money, agrees to the sales incentive. Soon, she can't believe the plummet in sales of widgets and addresses the issue by giving a stern warning to the reps at the next meeting to sell more widgets or else.

Another example involves a young colleague of mine who is a newly hired sales trainee for a distribution company. He attends training every Monday night. All the trainees work throughout different locations in a major metro area during the day, but they have cell phones, pagers, voice mail and e-mail. On a recent Monday, he traveled from the far reaches of the NW metro area to the home office in the SE metro area. Fighting heavy traffic, he arrived five minutes early to find a sign on the door that read, “Tonight's training session has been cancelled.”

Another friend of mine is a sales manager for a large wine and spirits distributor. She returns home Friday night after a long week of traveling and work to find the following e-mail from her boss, the general manager:

“To All Managers: Apparently some of you are abusing your allotted cell phone minutes. Cell phones are expensive, and your imprudent use of these tools is UNACCEPTABLE AND WILL NOT BE TOLERATED. If cell phone bills continue at these levels, I will be forced to suspend your privileges.”

In a generative learning organization, managers would not place blame or scold. Instead, they would think about the consequences. Learning organization managers would expand the search for the cause of the problem. In the above examples, learning organizations would design a system to address the counter issue, find a way to separate like products, plan incentives around corporate objectives, improve the communication system to reps and, instead of scolding adults, actually find a way to effectively manage cell phone usage.

In the retail store example, instead of the manager “saving the day,” she would have met with the clerks and explored the “root cause” of the problem. Instead of “blaming” the person for the problem, the manager would seek to clarify the role, eliminate task interference and set new guidelines for “attending to the counter.” This might mean rearranging stocking time, having the clerks automatically check the counter every three minutes using a timer method or understanding that, at certain times, a clerk must be at the counter and other work just has to wait.

Managers Must Lead the Way to Better Learning

Traditional management practices often reward managers for doing the wrong things. Peter Drucker called it “being clever,” and what he meant was that too many managers see their role as coming to the rescue and catching the balls before they hit the ground, always chasing the next set of problems. In contrast, Drucker argued that managers are paid to be “right.” They should be paid to help people improve skills, solve their own problems and perform better tomorrow than the best they could perform today. A manager operating in this role helps employees improve the process or system by generating a new or better way of doing things. This manager avoids placing blame on the person and spawns new techniques.

In order to move toward the learning organization model, managers must unlearn the adaptive style of problem-solving that is prevalent in many organizations today.

When managers learn to use problem-solving as a means to effectively change the system and to generate new and better ways to do things, the people who are part of the new learning will be part of the solution, and the managers will have added value to the process. Generating new permanent solutions helps managers add value to the organization and to the people who work for them.

For a quick guide to identifying learning opportunities titled 5 Ways to Get at the Root Cause of a Problem, please contact Tim Horan at [email protected] or at 321/956-8617.

For more on the subject of organizational learning, I would recommend the following books and authors:

• Schein, Edgar, (1992) Organizational Culture and Leadership, San Francisco: Jossey- Bass

• Senge, Peter, (1991) The Fifth Discipline, New York: Currency/Doubleday

• Senge, Peter, et al (1994) The Fifth Discipline Fieldbook, New York: Currency/Doubleday

Tim Horan ([email protected]), an organizational consultant, is a principal at Indian River Consulting Group. IRCG is an experience-driven, general consulting practice specializing in distribution issues for business-to-business distributors and manufacturers. Michael Marks founded IRCG in 1987. The firm has earned a reputation for helping companies achieve competitive advantage. You can contact them by calling 321/956-8617, or visit www.ircg.com for more information.