Learning Organizations And Its Role In Business Strategy

The Ohs

How do you refer to the decade from 2000 to 2010? My personal favorite is the ‘ohs’, so from here on that is what I am going to use. It was a turbulent time for the world, we all witnessed the tragedy of September 11, followed by a string of horrific global terror attacks. Economically we started the ohs with the bursting bubble of the dot.com era, where companies were going public with a value of billions but losing 100’s of millions along the way, and ended with the Global Financial Crisis. Let us also not forget the technological anticlimax that was Y2K. As the ohs concluded, the first version of a brand-new piece of strategy management software technology went into testing, it was called StrategyBlocks.

5 Key Disciplines of Learning Organizations

The innovative business concept of the ohs was the “Learning Organization”: everything about it sounds like a great idea and it still is. A learning organization, as proposed by Peter Senge in his book The Fifth Discipline, was defined as having the following five key disciplines:

  1. Applies systems thinking to their business processes and the organization as a whole
  2. Develops personal mastery, that people and teams are encouraged to grow
  3. Individuals and teams learn to adapt their mental models (assumptions, biases) based on market conditions
  4. The organization must establish a common vision for the future in which people are included
  5. And finally, in a true learning environment, “the team” together is more effective due to team learning through communication and coordination, “the whole is greater than the sum of its parts” (check out my last blog on self-managed teams).

Strategic Execution and the Learning Organization

The traditional problem with strategic planning and execution is that it is static and unchanging by nature, the opposite of a learning organization. It is also a poor method of strategic communication and certainly does not encourage collaboration.

As StrategyBlocks was shaped in many ways by the ohs, we started with 4 core principles:

  1. Recognize that people are the masters of their delegated strategic activities, and ensure they have the ability to form dynamic teams and drive accountability to team members
  2. Lessons learned are retained. Reuse of successful business strategy is fundamental as there is no point reinventing the wheel
  3. Every component of the strategic plan stems from a single overall vision and mission
  4. Communication between team members from top-to-bottom and bottom-to-top is critical. It needs to be engaging and motivating and draw people into the strategic execution process.

Next month I will investigate the past 10 years, which has seemed to be all about ‘agile’ and discuss how that has affected strategy.