CornerStone Consulting AssociatesOrganizational Learning Articles

Managing the Dream: The Learning Organization
by Charles Handy

In an uncertain world, where all we know for sure is that nothing is sure, we are going to need organizations that are continually renewing themselves, reinventing themselves, reinvigorating themselves. These are the learning organizations, the ones with the learning habit.

Just as the world has changed, so too has the process of learning. When the future was an extension of the present, it was reasonable to assume that what worked today would also work next year. That assumption must now be tossed out. During times of discontinuous change, it can almost be guaranteed that what used to work well in the past will not work at all next time around. The old approaches are simply too incremental. More than that, they are too slow.

Today we are hearing so much about change that the word is becoming a cliche. Rather than chant change, it is more accurate to say that we all -- individuals and organizations -- must acquire the learning habit, the new learning habit. It is a habit that changes many of the old assumptions about management. The learning organization is a different sort of place. But it is an exciting one.

Characteristics of the Learning Organization The learning organization is built upon an assumption of competence that is supported by four other qualities or characteristics: curiosity, forgiveness, trust and togetherness. The assumption of competence means that each individual can be expected to perform to the limit of his or her competence, with the minimum of supervision.

For too long, organizations have operated on an assumption of incompetence. The characteristics of this assumption are controls and directives, rules and procedures, layers of management and pyramids of power -- all very costly. By contrast, the assumption of competence promotes flat organizations, with fewer checkers checking checkers. Flat organizations are far more responsive, efficient and cost-effective. They put a high premium on early training, on acculturation in their ways and values and on some form of vetting or qualification before an individual is allowed to operate. In these organizations the learning habit starts early.

Competence alone, despite all the prior learning it implies, is not enough to foster the learning habit. It must be accompanied by curiosity. Watch a small child learning. The questions are endless, the curiosity insatiable. But curiosity does not end with the questions. Questions beg answers, and the truly curious are in search of the right answers. This often requires experimentation. This process is encouraged in the learning organization, provided there is an assumption of competence and a license to experiment within the boundaries of a person's authority.

Because experiments can fail, forgiveness is essential. Instead of failures, unsuccessful experiments must be viewed as part of the learning process, as lessons learned. One can also learn from successful experiments. That form of learning needs not to be forgiven but to be celebrated.

None of these things - competence, curiosity, forgiveness or celebration -can foster a leading organization if there is no trust. While people may be highly competent, you will not allow them to be competent unless you trust them. Of course, it is difficult to trust someone you don't know or have never seen in action. A person you know only by name from a memo is not a person to take a risk with. For the learning organization, the implications of this simple human fact are enormous. How many people can one person know well enough to trust them? On the answer to that question hangs the whole design and structure of the corporation.

One solution is togetherness. Few, if any, of the problems businesses face nowadays can be handled by one person acting alone. That is fortunate in a way, because curiosity, experimentation and forgiveness need to be shared. Lonely learners are often slow and poor learners, whereas people who collaborate learn from each other and create synergy.

Today we are seeing an increasing number of organizations made up of shifting ”clusters,” or teams, that share a common purpose. The need for togetherness, both to get things done and to encourage the kind of exploration that is essential to any growing organization, creates the conditions for trust. Trust, in turn, improves togetherness.

Despite the presence of trust and togetherness, the learning organization is not a comfortable place for its leaders. It is an upside-down sort of place, with much of the power residing at the organization's edge. In this culture, imposed authority no longer works. Instead, authority must be earned from those over whom it is exercised. This organization is held together by shared beliefs and values, people who are committed to each other and to common coals -- a rather tenuous method of control.

Such an upside-down way of running an organization requires a powerful theory to justify it: in this case, a theory of learning. Real learning is not what many of us grew up thinking itwas. It is not simply memorizing facts, learning drills or soaking up traditional wisdom.

The Wheel of Learning

This process can best be described as a wheel -- a wheel of learning. The wheel has four quadrants that, ideally, rotate in sequence as the wheel moves. The first quadrant consists of the questions, which may be triggered by problems or needs that require solutions. The questions prompt a search for possible answers or ideas, which must pass rigorous tests to see if they work. The results are then subjected to reflection, until we are certain we have identified the best solution. Only when the entire process is complete can we truly say that we have learned something. There are no shortcuts.

This process lies at the heart of individual growth and of corporate success. Too simple, some would say. They should try putting it into practice.

Organizations that have acquired the learning habit are questioning the status quo, are forever seeking new methods or new products, forever testing and then reflecting, consciously or unconsciously pushing round that wheel.

Keeping the Wheel Moving

Maintaining constant movement of the wheel is not as easy as it sounds. There are two key concepts which can help to keep it turning: subsidiarity and incidental leading.

Subsidiarity. The word itself is rather ugly, but the concept is important. Subsidiarity means encouraging individuals and groups to have as much power as they are competent to handle. It is an old idea in political theory, an idea central to democracy and an idea which, today, is at the heart of the learning organization. Power is given to those closest to the action.

Subsidiarity is managed, organizationally, by defining the boundaries of the job. There are two boundaries. The inner boundary defines the essential core of the job, be it an individual's job, a team's or a function's. This part of the job is defined, the roles and responsibilities made clear. If these things are not done, then one is seen to have failed. The outer boundary defines the limits of discretion. In between lies the scope for initiative and for personal responsibility.

W L. Gore, creator of the well-known ”Gore Tex” fabric, whose company does its best to foster the learning habit, makes a nice distinction between the two boundaries. There are experiments above the water-line, which do little harm if they go wrong, Gore pointed out, and there are experiments below the water-line, which might sink the ship. The former are encouraged; the latter are outlawed.

In good organizations, the mistakes are rare because the people are good; and they are good because they know that they will be entrusted with big responsibilities, including the chance to make mistakes. Subsidiarity is self-fulfilling.

In traditional organizations, the space for initiative is limited. Many jobs are all core and no space. The water-line is set very high. Control is tight. There is no initiative without prior permission. In the flexible, responsive organizations that are needed today, the space has to be larger because the center cannot define in advance the details of every job. Control then has to be after the event -- with forgiveness if necessary. This means that each individual or team must understand very clearly which types of initiatives are acceptable and which are not. Everyone has to agree on the definition of success. Control depends more on a common understanding than on budgets and procedures. Shared values reinforce constant and effective communications, all of which are essential if subsidiarity is going to work. The organization that talks together works together.

Incidental learning. Subsidiarity by itself will not move the wheel of learning. It needs to be bolstered by incidental learning. Incidental learning means treating every incident as a case study from which we can learn.

This learning does not occur automatically; opportunities must be created for it to develop. For example, regular meetings of one's group or cluster can be arranged to review recent critical events. This is, in fact, the time-honored way in which doctors, social workers and other professionals help each other to learn from their experiences. It requires honesty with oneself and with others, a sense of togetherness and trust. Incidental leading is the organization's way to build in time for reflection, the final segment of the wheel. A mentor from outside the organization or group can enhance the process by encouraging a free and frank exchange without acrimony.

Incidental learning is most appropriate when one is dealing with divergent problems. It was E. F. Schumacher, author of Small Is Beautiful who first distinguished between convergent and divergent problems. Convergent problems have right answers: ”This is the shortest route to Boston.” Divergent problems, such as ”Why do you want to go to Boston?” have answers that are only right for a particular person, time and place.

Once we have moved beyond the basics, all the problems of organizations are divergent, to be solved only by the process of the wheel. This is what makes organizations so endlessly fascinating, and also so difficult.

There Is No Alternative

People once believed that there was a science and a theory of organizations which, like the laws of motion, would allow us to predict and determine the future. We now know that this is impossible. We have learned that chance happenings will trigger chain reactions, that the past will be a poor guide to the future and that we shall forever be dealing with unanticipated events.

Given that scenario, organizations have no choice but to reinvent themselves almost every year. To succeed, they will need individuals who delight in the unknown. The wise organization will devote considerable time to identifying and recruiting such people and to ensuring job satisfaction. Being a ”preferred” organization will become increasingly important. Preferred organizations will be learning organizations. They will provide opportunities to exercise responsibility, to learn from experience, to take risks and to gain satisfaction from results achieved and lessons learned.

Such organizations will continue to defy conventional wisdom. They will be organizations of consent, not of control. They will be able to maintain a feeling of togetherness despite their size and far-flung locations. They will make many mistakes, but will have learned from them before others realize they occurred. They will invest hugely in their people and trust them hugely and save the salaries of ranks of inspectors. Above all, they will see learning not as a confession of ignorance but as the only way to live. It has been said that people who stop leading stop living. This is also true of organizations.

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