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NETWORK ORGANISATIONS ANDCROSS-ORGANISATIONAL LEARNING

HRM3011

Dr Rea Prouska – Middlesex University Business School

Dr Maria Kapsali – Imperial College Business School

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LEARNING OBJECTIVES

Critically examine what is meant by ‘organisational learning’ and ‘the learning organisation’.

Explore what is meant by ‘network organisations’, how these form and operate.

Critically analyse the way in which ‘cross-organisational learning’ takes place.

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THINK

Organisational Learning

The Learning Organisation

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THE IMPORTANCE OF LEARNING IN ORGANISATIONS

What is the importance of learning in organisations?

http://www.youtube.com/watch?v=lUP4WcfNyAA

ORGANISATIONAL LEARNING

‘Organisational learning’ – based on observations of individual and collective learning processes in an organisation.

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ORGANISATIONAL LEARNING Organisational learning is more than just the

sum of individual learning Members learn together when individual’s

learning impacts on and interrelates with others and begin to change the way things are done

Increase in collective competence How individual learning feeds into

organisational learning is just beginning to be addressed

Viewing the organisation as a process or a living organism helps

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THE LEARNING ORGANISATION

Can be defined as ‘an organisation which facilitates the learning of all its members and continually transforms itself’ (Pedlar, Boydell and Burgoyne, 1987)

‘Learning is not restricted to discrete hunks of training activity, either fragmented or systematic, but is one where it has become a continuous process, and where on the job learning has become a way of life’ (Barham et al., 1988: 50).

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PRINCIPLES AND CHARACTERISTICS OF A LEARNING ORGANISATION

It can learn as much, if not more, from failure as from success.

Rejects the adage ‘if it isn't broke, don’t fix it’ as it constantly scrutinises the way things are done.

Assumes that managers and workers closest to the design, manufacturing, distribution and sale of the product often know more about these activities than their superiors.

Seeks to move knowledge from one part of the organisationto another.

It encourages people at all levels of the organisation to learn regularly and rigorously from their work

It has systems for capturing and learning information and moving it where it is needed

It is able to transform itself continuously Spends a lot of energy looking outside its own boundaries

for knowledge.

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DISCUSS

“Learning organisations are dreams which can never come true”. Discuss why you agree or disagree with this statement.

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DIFFICULTIES WITH THE LEARNING ORGANISATION CONCEPT

Effective implementation of the learning organisation concept requires the resolution of:

Meaning (or definition) Management (or practical operational advice) Measurement (tools for assessment)

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NETWORK ORGANISATIONS

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CROSS-ORGANISATIONAL LEARNING

Through alliances and networks, organisations can learn and internalise new skills (Hyder and Abraha, 2004), particularly those hard to obtain and internalise by other means (Doz and Hamel, 1998:5).

However, strategic alliances cannot easily replace the internal development of organisational capabilities (Chan and Wong, 1994). Why?

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PROCESSES OF CROSS-ORGANISATIONAL LEARNING (1)

Experience: a firm’s independent experiment and acquisition of knowledge through trial and error (Osland and Yaprak, 1995).

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PROCESSES OF CROSS-ORGANISATIONAL LEARNING (2)

Imitation: an attempt to learn about the strategies, technologies and functional activities of other firms and to internalise this second-hand experience (Osland and Yaprak, 1995). Open imitation: one partner agrees to let the

other partner use, for example, a particular technology under specified conditions (Hyder and Abraha, 2004).

Secret imitation: the owner of the resource has no intention of letting the partner imitate (Hyder and Abraha, 2004).

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PROCESSES OF CROSS-ORGANISATIONAL LEARNING (3)

Grafting: organisations increase their store of knowledge by formally acquiring another firm or by developing a long-term alliance with another organisation that possesses information not previously available within the organisation (Osland and Abraha, 2004). Grafting is often faster than learning by experience and more complete than learning through imitation.

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PROCESSES OF CROSS-ORGANISATIONAL LEARNING (4)

Synergism: firms collaborate to produce new knowledge. Through collaboration partners can develop innovations that may not have been possible through independent efforts (Osland and Abraha, 2004).

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KNOWLEDGE TRANSFER

The replication of knowledge in alliances requires both firms to implement managerial processes to transfer and receive knowledge (Wang and Nicholas , 2005).

Wang and Nicholas (2005) distinguish learning into collective and competitive: Collective learning occurs in cases where

partners learn to work together and mutually acquire knowledge.

Competitive learning occurs when partners strive to out-learn each other.

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RELATIONSHIP BETWEEN PARTNERS Critical to a long-lasting cross-organisational

learning process is the relationship between the partners.

Many relationships never evolve, while most enter a deep crisis within the first three years

The key to longevity of contracting relationships is learning and adjustment, first to each other, then to changed circumstances.

Successful alliances and networks go through cycles of learning, re-evaluation, and readjustment over time. As the partnership evolves, partners re-evaluate the potential of the alliance to create value, the expected balance and equity of value capture among them, and their ability and commitment to adjust to the existing conditions of the alliance.

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FACTORS AFFECTING THE OUTCOME OF CROSS-ORGANISATIONAL LEARNING INITIATIVES

Ideas?

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FACTORS

Industry/sector Type of relationship Trust, risk, power and control in relationship Organisational strategy Organisational culture Learning culture/strategy Knowledge management processes

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LEARNING=KNOWLEDGE TRANSFER

Types of trans-organizational learning transfer: Alliances, mergers, acquisitions, projects, networks

Depends on the degree of integration within the supply-value chains between the organizations

Less More Projects Alliances Mergers Acquisitions

Networks

Is this correct?

relatedness of the knowledge bases between the acquiring and acquired firms and whether the rationale of the jointed activity

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CHARACTERISTICS OF ORGANIZATIONAL NETWORKS

Interaction Content = the purpose of

the interaction

Direction = direction of the flow of interaction or indication of lack of reciprocity

Durability = the period over which a certain set of links to the organization is activated and used

Intensity = volume of information, funds, decisions, flowing between given nodes

Frequency = frequency of interaction or contact

Shape Reachability Density = degree of

interconnectedness of a group of organizations cohesiveness vs isolationism

Range = the number of direct links to an organization to mobilize support on an issue

Composition = diversity and conflict within teams (lately the role of innovation)

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WHO are the people at the interfaces of these networks

Within the organization: middle managers

Across organizations: project managers

WHERE are the boundaries between value chains when density of interaction increases

WHAT are the obstacles for learning coming from networking

HOW can organizations control the type and level of learning through networks

WHICH types of learning are favoured by which types of relations

brokerage, power, trust and reputation

dynamics of conflict and consensus

distribution of power

Combine knowledge assets coordinated management of functions, the

bilateral transfer of expert staff, or the transfer for further development of products or processes

synergies that can occur from relatedness the impact of both technological and

market relatedness on learning combinations of two factors: the

complementarity or similarity of the knowledge and the complementarity or similarity of the production capabilities of the target and the acquiring firm

Knowledge and integration approach = the rationale of the deal

complementarity or similarity

appropriate integration strategy organizational design and strategy

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TASK AND NETWORK NEED (KATZ AND LAZER, 2003: 97)

Lazer & Katz, 2003] Lazer D. & N. Katz, 2003, “Building effective intra-organizational networks: the role of teams.” Research Paper, Centre for Public Leadership, J.F. Kennedy School of Government, Harvard University.

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ACTIVITY – 10 MINUTES

What are the differences between these types of organizational interaction – what parts of their value chain do they share

How exactly learning happens to these different types

When does networking impede rather than support learning and goal achievement