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All organizations learn, whether they consciously choose to or not — it is a fundamental requirement for their sustained existence. Some firms deliberately advance organizational learning, developing capabilities that are consistent with their objectives; others make no focused effort and, therefore, acquire habits that are counterproductive. Nonetheless, all organizations learn.
But what does it mean that an organization learns? We can think of organizational learning as a metaphor derived from our understanding of individual learning. In fact, organizations ultimately learn via their individual members. Hence, theories of individual learning are crucial for understanding organizational learning. Psychologists have studied individual learning for decades, but they are still far from fully understanding the workings of the human mind. Likewise, the theory of organizational learning is still in its embryonic stage.1
The purpose of this paper is to build a theory about the process through which individual learning advances organizational learning. To do this, we must address the role of individual learning and memory, differentiate between levels of learning, take into account different organizational types, and specify the transfer mechanism between individual and organizational learning. This transfer is at the heart of organizational learning: the process through which individual learning becomes embedded in an organization’s memory and structure. Until now, it has received little attention and is not well understood, although a promising interaction between organization theory and psychology has begun.2 To contribute to our understanding of the nature of the learning organization, I present a framework that focuses on the crucial link between individual learning and organizational learning. Once we have a clear understanding of this transfer process, we can actively manage the learning process to make it consistent with an organization’s goals, vision, and values.
The importance of individual learning for organizational learning is at once obvious and subtle — obvious because all organizations are composed of individuals; subtle because organizations can learn independent of any specific individual but not independent of all individuals. Psychologists, linguists, educators, and others have heavily researched the topic of learning at the individual level. They have made discoveries about cognitive limitations as well as the seemingly infinite capacity of the human mind to learn new things.3 Piaget’s focus on the cognitive-development processes of children and Lewin’s work on action research and laboratory training have provided much insight into how we learn as individuals and in groups.
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1. H.P. Sims et al., The Thinking Organization (San Francisco: Jossey-Bass, 1986); and
G.P. Huber, “Organizational Learning: The Contributing Processes and the Literature,” Organization Science 2 (1991): 88–115.
2. See B. Hedberg, “How Organizations Learn and Unlearn,” in Handbook of Organizational Design, ed. P.C. Nystrom and W.H. Starbuck (London: Oxford University Press, 1981), pp. 3–27; and M.D. Cohen, “Individual Learning and Organizational Routine: Emerging Connections,” Organization Science 2 (1991): 135–139.
3. On limitations, see:
H.A. Simon, Models of Man (New York: John Wiley, 1957).
On capacity to learn, see:
R.M. Restak, The Mind (New York: Bantam, 1988).
4. D.A. Kolb, Experiential Learning: Experience as the Source of Learning and Development (Englewood Cliffs, New Jersey: Prentice-Hall, 1984).
5. E.R. Hilgard and G.H. Bower, Theories of Learning (New York: Appleton-Century-Crofts, 1966). See also:
G.A. Miller, “The Magic Number Seven, Plus or Minus Two: Some Limits on Our Capacity for Processing Information,” The Psychology Review 63 (1956): 81–97;
Simon (1957); and
A. Tversky and D. Kahneman, “Rational Choice and the Framing of Decisions,” in Rational Choice: The Contrast between Economics and Psychology, ed. R.M. Hogarth and M.W. Reder (Chicago: University of Chicago Press, 1987).
6. E. Jaques, Requisite Organization (Arlington, Virginia: Cason-Hall Associates, 1989).
7. E.H. Schein adds a third dimension — emotional conditioning and learned anxiety — that can have a powerful effect on the first two types of learning. See:
E.H. Schein, “How Can Organizations Learn Faster? The Challenge of Entering the Green Room,” Sloan Management Review, Winter 1993, pp. 85–92.
8. C. Argyris and D. Schon, Organizational Learning: A Theory of Action Perspective (Reading, Massachusetts: Addison-Wesley, 1978).
9. J. Piaget, Structuralism (New York: Basic Books, 1970).
10. Kolb (1984), p. 38.
11. Other schools include behavioral and rationalist learning theory. See:
Kolb (1984), p. 38.
12. Ibid., p. 21.
13. K. Ishikawa, What Is Total Quality Control? (Englewood Cliffs, New Jersey: Prentice-Hall, 1985), p. 59.
14. W.E. Deming, Quality, Productivity, and Competitive Position: Dr. W. Edwards Deming’s Seminar Notes (Ford Quality Education and Training Center, 1992).
15. E.H. Schein, Process Consultation, Volume II: Lessons for Managers and Consultants (Reading, Massachusetts: Addison-Wesley, 1987), p. 64.
16. Argyris and Schon (1978), p. 141.
17. F. Kofman, lecture slides (Cambridge, Massachusetts: MIT Sloan School of Management, 1992).
18. L. Postman, “Methodology of Human Learning,” in Handbook of Learning and Cognitive Processes, Vol. 3., ed. W.K. Estes (New York: John Wiley, 1976), pp. 11–69.
19. P.M. Senge, The Fifth Discipline (New York: Doubleday, 1990a). See also:
J.W. Forrester, World Dynamics (Cambridge, Massachusetts: Productivity Press, 1971).
20. Senge (1990a), pp. 192–193.
21. Argyris and Schon (1978), p. 9.
22. Ibid., p. 17.
S.G. Winter, “The Case for ‘Mechanistic’ Decision Making,” in Organizational Strategy and Change, ed. H. Pennings (San Francisco: Jossey-Bass, 1985), pp. 99–113;
C. Perrow, Complex Organizations (New York: Random House, 1986); and
B.L.T. Hedberg, P.C. Nystrom, and W.H. Starbuck, “Camping on Seesaws: Prescriptions for a Self-Designing Organization,” Administrative Science Quarterly 21 (1976): 41–65.
24. B. Levitt and J.G. March, “Organizational Learning,” Annual Review of Sociology 14 (1988), pp. 319–340.
25. Winter (1985), p. 111.
26. H.A. Simon, Sciences of the Artificial (Cambridge, Massachusetts: MIT Press, 1981), p. 65.
27. R.M. Cyert and J.G. March, A Behavioral Theory of the Firm (Englewood Cliffs, New Jersey: Prentice-Hall, 1963).
28. J.G. March and J.P. Olsen, “The Uncertainty of the Past: Organizational Learning under Ambiguity,” European Journal of Political Research 3 (1975): 147–171.
29. R.L. Daft and K.E. Weick, “Toward a Model of Organizations as Interpretation Systems,” Academy of Management Review 9 (1984): 284–295.
30. For example, adaptation theories can be viewed as analogs of individual stimulus-response theories and strategic choice models having similarities with psychodynamic theories.
31. R.E. Miles et al., “Organizational Strategy, Structure, and Process,” Academy of Management Review 3 (1978): 546–563.
32. For a fuller treatment of this model, see:
D. Kim, “A Framework and Methodology for Linking Individual and Organizational Learning: Application in TQM and Product Development” (Cambridge, Massachusetts: MIT Sloan School of Management, Ph.D. Diss., 1993).
33. See D.C. Feldman, “The Development and Enforcement of Group Norms,” Academy of Management Review 9 (1984): 47–53; D.J. Isenberg, “Group Polarization: A Critical Review and Meta-analysis,” Journal of Personality and Social Psychology 50 (1986): 1141–1151; and
J.R. Hackman, “Group Influences on Individuals in Organizations,” in Handbook of Industrial and Organizational Psychology, ed. M.D. Dunnette (Chicago: Rand-McNally, 1976).
34. R.E. Walton and J.R. Hackman, “Groups under Contrasting Management Strategies,” in Designing Effective Work Groups, ed. P.S. Goodman (San Francisco: Jossey-Bass, 1986).
35. H.A. Simon, “Bounded Rationality and Organizational Learning,” Organization Science 2 (1991): 125–134; and J.W. Forrester, “System Dynamics and the Lessons of Thirty-Five Years,” Systems-Based Approach to Policy Making, ed. K.B. DeGreene (Norwell, Massachusetts: Kluwer Academic Publishers, 1993).
36. See, for example:
A. Bostrom, B. Fischhoff, and G.M. Granger, “Characterizing Mental Models of Hazardous Processes: A Methodology and an Application to Radon,” Journal of Social Issues 48 (1992): 85–100.
37. Senge (1990a).
38. J.D. Sterman, “Modeling Managerial Behavior: Misperceptions of Feedback in a Dynamic Decision-Making Experiment,” Management Science 35 (1989): 321–339.
39. Senge (1990a); and
D.H. Kim, Toolbox Reprint Series: Systems Archetypes (Cambridge, Massachusetts: Pegasus Communications, 1992).
40. N. Zeniuk, “Learning to Learn: A New Look at Product Development,” The Systems Thinker 4 (1993): 1.
41. P.M. Senge, “The Leader’s New Work: Building Learning Organizations,” Sloan Management Review, Fall 1990b, pp. 7–23; and D.H. Kim, Toward Learning Organizations: Integrating Total Quality Control and Systems Thinking (Cambridge, Massachusetts: Pegasus Communications, 1990).
42. Senge (1990b).