A learning organization is an organization that has developed the capacity to continuously adapt and change because all members take an active role in making decisions and performing their work. (Robbins, Bergman, Stagg & Coulter 2003) The concept of a learning organization does not have a specific organization design but rather describes an organisational mindset or philosophy. A learning organization is an organization that by virtue of people, values, and systems is able to continuously change and improve its performance based upon the lessons of experience. (Schermerhorn 2002)
In a learning organization, employees are practising knowledge management by continually acquiring and sharing new knowledge and are willing to apply that knowledge in making decisions and performing their work. (Robbins, Bergman, Stagg & Coulter 2003) Some organizational design theorists even go so far as to say that an organizations ability to do this may be the only source of competitive advantage.
Knowledge management is used to describe the processes through which organizations develop, organize, and share knowledge to achieve competitive advantage. It is a mobilization of intellectual capital. (Schermerhorn 2002)
Managers stimulate and lead change in ways that create true learning organizations in which everyone: Sets aside old ways of thinking, Becomes self aware and open to others, Learns how the whole organization works, Understands and agrees to action plans and works together to accomplish the plans. (Schermerhorn 2002)
The core ingredients of a working organization are: Mental modes: Everyone sets aside old ways of thinking, Personal mastery: Everyone becomes self-aware and open to others, Systems thinking: Everyone learns how the organization works, Share vision: Everyone understands and agrees to a plan of action and Team learning: Everyone works together to accomplish the plan. (Schermerhorn 2002)
The only source of sustainable competitive advantage for any organization over the long term is...