The Leader’s New Work: Building Learning Organizations

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HUMAN BEINGS are designed for learning. No one has to teach an infant to walk, or talk, or master the spatial relationships needed to stack eight building blocks that don’t topple. Children come fully equipped with an insatiable drive to explore and experiment. Unfortunately, the primary institutions of our society are oriented predominantly toward controlling rather than learning, rewarding individuals for performing for others rather than for cultivating their natural curiosity and impulse to learn. The young child entering school discovers quickly that the name of the game is getting the right answer and avoiding mistakes — a mandate no less compelling to the aspiring manager.

“Our prevailing system of management has destroyed our people,” writes W. Edwards Deming, leader in the quality movement.1 “People are born with intrinsic motivation, self-esteem, dignity, curiosity to learn, joy in learning. The forces of destruction begin with toddlers — a prize for the best Halloween costume, grades in school, gold stars, and on up through the university. On the job, people, teams, divisions are ranked — reward for the one at the top, punishment at the bottom. MBO quotas, incentive pay, business plans, put together separately, division by division, cause further loss, unknown and unknowable.”

Ironically, by focusing on performing for someone else’s approval, corporations create the very conditions that predestine them to mediocre performance. Over the long run, superior performance depends on superior learning. A Shell study showed that, according to former planning director Arie de Geus, “a full one-third of the Fortune “500’ industrials listed in 1970 had vanished by 1983.”2 Today, the average lifetime of the largest industrial enterprises is probably less than half the average lifetime of a person in an industrial society. On the other hand, de Geus and his colleagues at Shell also found a small number of companies that survived for seventy-five years or longer. Interestingly, the key to their survival was the ability to run “experiments in the margin,” to continually explore new business and organizational opportunities that create potential new sources of growth.

If anything, the need for understanding how organizations learn and accelerating that learning is greater today than ever before. The old days when a Henry Ford, Alfred Sloan, or Tom Watson learned for the organization are gone.

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1. P. Senge, The Fifth Discipline: The Art and Practice of the Learning Organization (New York: Doubleday/Currency, 1990).

2. A.P. de Geus, “Planning as Learning,” Harvard Business Review, March–April 1988, pp. 70–74.

3. B. Domain, Fortune, 3 July 1989, pp. 48–62.

4. The distinction between adaptive and generative learning has its roots in the distinction between what Argyris and Schon have called their “single-loop” learning, in which individuals or groups adjust their behavior relative to fixed goals, norms, and assumptions, and “double-loop” learning, in which goals, norms, and assumptions, as well as behavior, are open to change, e.g., see C. Argyris and D. Schon, Organizational Learning: A Theory-in-Action Perspective (Reading, Massachusetts: Addison-Wesley, 1978).

5. All unattributed quotes are from personal communications with the author.

6. G. Stalk, Jr., “Time: The Next Source of Competitive Advantage,” Harvard Business Review, July–August 1988, pp. 41–51.

7. Senge (1990).

8. The principle of creative tension comes from Robert Fritz’ work on creativity. See R. Fritz, The Path of Least Resistance (New York: Ballantine, 1989) and Creating (New York: Ballantine, 1990).

9. M.L. King, Jr., “Letter from Birmingham Jail,” American Visions, January–February 1986, pp. 52–59.

10. E. Schein, Organizational Culture and Leadership (San Francisco: Jossey-Bass, 1985). Similar views have been expressed by many leadership theorists. For example, see: P. Selznick, Leadership in Administration (New York: Harper & Row, 1957); W. Bennis and B. Nanus, Leaders (New York: Harper & Row, 1985); and N.M. Tichy and M.A. Devanna, The Transformational Leader (New York: John Wiley & Sons, 1986).

11. Selznick (1957).

12. J.W. Forrester, “A New Corporate Design,” Sloan Management Review (formerly Industrial Management Review), Fall 1965, pp. 5–17.

13. See, for example, H. Mintzberg, “Crafting Strategy,” Harvard Business Review, July–August 1987, pp. 66–75.

14. R. Mason and I. Mitroff, Challenging Strategic Planning Assumptions (New York: John Wiley & Sons, 1981), p. 16.

15. P. Wack, “Scenarios: Uncharted Waters Ahead,” Harvard Business Review, September–October 1985, pp. 73–89.

16. de Geus (1988).

17. M. de Pree, Leadership Is an Art (New York: Doubleday, 1989), p. 9.

18. For example, see T. Peters and N. Austin, A Passion for Excellence (New York: Random House, 1985) and J.M. Kouzes and B.Z. Posner, The Leadership Challenge (San Francisco: Jossey-Bass, 1987).

19. 1. Mitroff, Break-Away Thinking (New York: John Wiley & Sons, 1988), pp. 66–67.

20. R.K. Greenleaf, Servant Leadership: A Journey into the Nature of Legitimate Power and Greatness(New York: Paulist Press, 1977).

21. L. Miller, American Spirit: Visions of a New Corporate Culture (New York: William Morrow, 1984), p 15.

22. These points are condensed from the practices of the five disciplines examined in Senge (1990).

23. The ideas below are based to a considerable extent on the work of Chris Argyris, Donald Schon, and their Action Science colleagues:

C. Argyris and D. Schon, Organizational Learning: a Theory-in-Action Perspective (Reading, Massachusetts: Addison-Wesley, 1978);

C. Argyris, R. Putnam, and D. Smith, Action Science (San Francisco: Jossey-Bass, 1985);

C. Argyris, Strategy, Change, and Defensive Routines (Boston: Pitman, 1985); and

C. Argyris, Overcoming Organizational Defenses (Englewood Cliffs, New Jersey: Prentice-Hall, 1990).

24. I am indebted to Diana Smith for the summary points below.

25. The system archetypes are one of several systems diagramming and communication tools. See D.H. Kim, “Toward Learning Organizations: Integrating Total Quality Control and Systems Thinking” (Cambridge, Massachusetts: MIT Sloan School of Management, Working Paper No. 3037-89-BPS, June 1989).

26. This archetype is closely associated with the work of ecologist Garrett Hardin, who coined its label: “The Tragedy of the Commons,” Science, 13 December 1968.

27. These templates were originally developed by Jennifer Kemeny, Charles Kiefer, and Michael Goodman of Innovation Associates, Inc., Framingham, Massachusetts.

28. C. Hampden-Turner, Charting the Corporate Mind (New York: The Free Press, 1990).

29. M. Sashkin and W.W. Burke, “Organization Development in the 1980s” and “An End-of-the-Eighties Retrospective,” in Advances in Organization Development, ed. F. Masarik (Norwood, New Jersey: Ablex, 1990).

30. E. Schein (1985).

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Comment (1)
Fabiana Taboada
I came to this article from Argentina, by reference to a practical activity in a subject of the Master in International Management of technology and innovation that I am doing.
I came across a version of Peter Senge dated October 15, 1990.
And I am very surprised that as of today, February 10, 2021, almost 31 years is still so valid.