MANAGING ORGANIZATIONS

PGP 2012-14 Section C & ETerm 1:June-September 2012

Sourav MukherjiAssociate Professor of Organization & StrategyIndian Institute of Management Bangalore, India

Session 12: Organization Learning & Knowledge Management

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PERSPECTIVES ON ORGANIZATION LEARNING 2

Why is learning important for organizations? What impact is it having on organization structure and

processes? When and how does an organization learn?

How do you know that learning has happened? Do organizations learn or do individuals in organizations

learn? How is organizational learning different from individuals learning in organizations?

How can the process of organization learning be managed? How is learning related to knowledge, intellectual property?

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3ORGANIZATIONS LEARN TO DEAL WITH CHANGE, TO IMPROVE AND TO COMPETE BETTER

Dynamic business conditions create problems of hardwiring work processes into formal structure and hierarchy

Uncertainty has made it difficult to define ‘one-best-way’ of doing things

Locus of decision making is coalescing with locus of information acquisition and processing

From traditional hierarchies…

Organizations are using semi-autonomous temporary structures such as teams and task forces to solve problems

Knowledge intensive organizations prefer to have flatter organizations with less hierarchy

Onus of learning and problem solving has now shifted to the individual employees from the senior management

…to networked organizations

Need for learning has induced structural changes

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LEARNING LEADS TO CHANGE IN BEHAVIOUR 4

Organization learning leads to improvement in performance

Similar Different BEHAVIOUR

New

STIMULUS

Old

Cognitive change links learningto behavioral change

Learning is linked to the concept of mental models. In the organization context,this is referred to as organization code, theory of business and some aspects of organization culture

Organizations learn by changing their collective business models

Converting individual learning into organizationlearning is one of the key challenges of building a learning organization

Which of the quadrants above represents learning?

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ORGANIZATIONS LEARN IN VARIOUS WAYS

Systematic problem solving Deming’s Plan-Do-Check-Act (PDCA) Hypothesis generation, testing and validation Error detection and correction / single loop and double loop learning

Experimentation Exploration versus exploitation tradeoffs Incremental and disruptive innovations

Learning from experience Organization memory Case studies, After Action Reviews Learning from success or failures

Learning from others Transfer of best practices Acquisitions, grafting

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THREE BUILDING BLOCKS OF ORGANIZATIONAL LEARNING 6

A supportive learning environment

Concrete learning processes & practices

1

2

Leadership that reinforces learning3

Source: “Is Yours a Learning Organization?” D A Garvin, A C Edmondson & F Gino, Harvard Business Review, March 2008

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A supportive learning environment

Concrete learning processes & practices

1

2

Leadership that reinforces learning3

Psychological safety

Appreciation of differences

Openness to new ideas

Time for reflection

Source: “Is Yours a Learning Organization?” D A Garvin, A C Edmondson & F Gino, Harvard Business Review, March 2008

THREE BUILDING BLOCKS OF ORGANIZATIONAL LEARNING

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A supportive learning environment

Concrete learning processes & practices

1

2

Leadership that reinforces learning3

Leaders actively question & listen to employees

Leaders prompt dialogue &debate

Leaders entertain alternate point of views

Leaders encourage spendingtime on problem identification& reflection

Source: “Is Yours a Learning Organization?” D A Garvin, A C Edmondson & F Gino, Harvard Business Review, March 2008

THREE BUILDING BLOCKS OF ORGANIZATIONAL LEARNING

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A supportive learning environment

Concrete learning processes & practices

1

2

Leadership that reinforces learning3

Generation of knowledge

Collection of information

Transfer of information

Application of knowledge

Source: “Is Yours a Learning Organization?” D A Garvin, A C Edmondson & F Gino, Harvard Business Review, March 2008

THREE BUILDING BLOCKS OF ORGANIZATIONAL LEARNING

This is the domain of organization’s knowledge management practices

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What exactly is knowledge?What is its relationship to learning? How does one manage knowledge, as opposed to managingdata or information?

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11FIRST INFLECTION POINT IN KNOWLEDGE MANAGEMENT

Organizations realize the need to customize knowledge management efforts based on nature of knowledge

Significant part of knowledge is not easily amenable to articulation or documentation. Such knowledge is

• complex, intangible and tacit• architectural and systemic • organizational specific • contextually embedded• causally ambiguous• private and path dependent• abstract and conceptual• intuitive, expertise driven• holistic & evolutionary

• Less amenable to imitation or spillover• Sustainable source of competitive advantage• Difficult to ‘manage’ or ‘measure’

Such knowledge can only be shared or recreated by means of people-to-people or social interactions

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12CODIFICATION VERSUS PERSONALIZATION

Codifying knowledge in documentsand databases to gain from reuse

• IT based system for codification storage, dissemination and reuse of explicit knowledge • Techniques for storage, classification and retrieval• Repeated application of standardized knowledge in industries where it is easy to define ‘right knowledge’• Reward employees for contributing to and usage from the knowledge repository

Making people to people connectionsfor synthesis of expertise

• Facilitative conditions for sharing of knowledge that is tacit , complex and deeply rooted in context • IT used for creating collaborative platforms, social networks• Suitable in problem solving environments demanding generation of new insights• Reward employees for directly sharing knowledge with one another

Some organizations choose one over the other – others view them as evolutionary stages

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13KM IN STRATEGY CONSULTING FIRMS

High quality, reliable, fast ITimplementation by reusingcodified knowledge

CompetitiveStrategy

Creative analytically rigorous advice on high level strategic problems

Reuse economics:- Invest once, reuse many times- High ratio of associates / partners- Large teams, maximize revenues

EconomicModel

Expert economics:- Customized solutions to novel problems- Small teams, low associate/partner ratio- High profit margin

People to documents:IT based KM system for codificationstorage, dissemination and reuse

KMStrategy

People to people:- Develop networks for linking people - Facilitative platforms for collaboration

- Hire freshers suited to reuse of knowledge and implementation- Train people in groups through computer based distance learning- Reward people for using and contributing to database

Human Resources

-Hire MBA’s who like problem solving and have high tolerance for ambiguity-train people through one-to-one mentoring -reward people for directly sharing knowledge with one another

Codification : Anderson , E&Y Personalization : McKinsey, Bain

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14THREE KEY COMPONENTS OF WIPRO’S KM SYSTEM

Creation of user groups having specific interest

Any employee can join the discussion, even though they are not part of the user group

System maintains log of discussions for future references

Access privileges

Document repositoryDocument repository

Repository of all documents prepared by employees based on their experience of solving problems

Historically divided between documents related to technology and those related to sales and marketing

Collaterals, proposals, letter of references, updated information needed to make proposals and presentations

Experts’ DirectoryExperts’ Directory

Domain specialists declare themselves as experts. Database maintains their profiles

Queries are posted at the system, or targeted specifically for an expert

System notes whether the expert has been able to solve the problem. Measures level of satisfaction of users

Collaborative Platforms

Collaborative Platforms

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Reduce re-work, increase efficiencyReduce re-work,

increase efficiencyMake people to

people connectionsMake people to

people connectionsCommunities of

practiceCommunities of

practice

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One to one

One to many

People to document People to people

Key issues encountered

• Open access versus restricted access

• Maintaining quality and credibility

• Incentives

Document repository

Expert locator / Yellow pages

Knowledge networks / Collaborative platforms

discussion logsdata mining

Over a period of time, people- to- people connection systems became more popular

Emails, newsletters

WIPRO ‘LET A THOUSAND FLOWERS BLOOM’