Organizational Development

Learning Organizations

Learning organizations are the result of looking for new ways to successfully respond to a world of interdependence and change, and the ideal learning organization has developed the continuous capacity to adapt and change. The characteristics of a learning organization:

  • There exists a shared vision which everyone agrees on
  • People discard old ways of thinking and standard routines
  • Members think of all organizational processes, activities, functions and interactions with the environment as part of a system with interrelationships
  • People openly communicate with each other across vertical and horizontal boundaries without fear of criticism or punishment
  • Personal self-interests and fragmented departmental interests are sublimated to the organization’s shared vision

This is easier to say than it is to do, but I think we can agree that most of these aspects of a learning organization are not in place where Amazon and Whole Foods are concerned.

Typical organizations address problems with single-loop learning, where errors are corrected using past routines and present policies. Learning organizations, however, have adopted double- loop learning¸ where errors are corrected by modifying the organization’s objectives, policies, and standard routines.

Furthermore, learning organizations are meant to be a remedy for three fundamental problems inherent in traditional organizations: fragmentation, competition, and reactiveness.

Fragmentation refers to the specialization within an organization that creates walls and silos. This fragmentation separates different functions into independent areas that often bicker with one another. Amazon is, in itself, a silo, with a rigid culture based on discipline and prescribed rules and regulations. Rather than reviewing and negotiating Whole Foods’ culture, they went about operating the grocery chain with Amazon rules – including scorecards and regulations. Amazon has inadvertently created an “us” and “they” with their actions.

Competition in an organization undermines collaboration. Managers compete to show who is right, who knows more, who is the most powerful. Whole Foods workers were used to having a lot of autonomy in their actions, negotiating face-to-face with customers and making educated decisions about how to go about their work. Amazon’s new rules and regulations will spike competition by presenting these new measurements and regulations by which Whole Food employees are evaluated.

Finally, reactiveness misdirects management’s attention to problem solving rather than creation. It remains to be seen how Amazon will respond to their faltering relationship with their adopted child. Experts agree that performance in 2019 will be key to Amazon’s future success in the grocery space, but will they be able to get this unstable ship moving in the right direction to do so? The managers of both companies have the opportunity to create something new, but if they’re addressing problems at every turn rather than innovating, reactiveness will thwart their efforts.

Organizations can make an effort to become a learning organization. Changing an organization to be a continual learner includes:

  • Establishing a strategy: a commitment to change, innovation and continuous improvement
  • Redesign the organization’s structure: formal structures can impede learning, so flattening the structure and putting teams into place increase cross-functional communication and eliminate boundaries
  • Reshape the organization’s culture: management must change its behavior as well as its strategy to embrace risk and change.

Amazon isn’t going to wake up one morning, look at their faltering brick-and-mortar grocery sales, and say, “Hey, let’s become a learning organization and make this work.” Becoming a learning organization isn’t the solution to their problem—skillful change management is what’s needed. But organizations have thought about how to avoid what’s happening with the Amazon/Whole Foods merger and concepts like learning organizations are what results from it.

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Organizational Behavior by Icfai Business School is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License, except where otherwise noted.