The Need for Organizational Learning is Now
In Kathia Laszlo’s May 2nd post, she spoke to the critical need to rethink and expand boundaries within a system to support different ways of working and learning together. The need to create organizational cultures where learning together is the norm has never been so important as it is during this time of increasing complexity and change. The major news story this week is JPMorgan Chase admitting big losses on egregious credit trades. The $2 billion loss was unexpected and CEO Jamie Dimon is now challenged to explain the result of the bank’s action in light of his stance on government regulation.
While there is a desire in most organizations to reduce the regulation that provides oversight to ensure ethical behavior and consumer protection, I am not convinced that we can reduce regulation until we improve our capacity to learn, individual and collectively, within our organizations and communities. As Kathia Laszlo noted, learning is not just an individual activity that is focused on acquiring knowledge and skills. Learning is a collective process that helps us make meaning within the context of our lives. When organizations create cultures that support people learning together, through engaging reflection and dialogue, they are less likely to encounter the major unexpected losses such as those reported by JP Morgan Chase or the many others that caught the financial industry by surprise in 2008 and took down the world economy.
We no longer live in a world where these types of actions can be tolerated. Organizations have to be held accountable for the risks they take and especially for their errors in judgment. Given how the financial crisis emerged in 2008, it makes sense to ask what other financial institutions might be engaging in similar egregious trades with risk of major losses? What impact will this have on a fragile economic recovery? How can we ensure what happened in 2008 will not happen again?
Government regulation is not a systemic solution to the problem, but likely needed until organizations create learning cultures that ensure they can take healthy risks and learn from small mistakes. Since Peter Senge published The Fifth Discipline: The Art and Practice of the Learning Organization in 1990, I have been focused on bringing the concepts and practices of organizational and transformative learning to graduate students and to organizations. As I was discussing with a group of students taking a course on generative and strategic dialogue with me, dialogic approaches to communication and relational ways of being and working together in organizations are still counter-cultural to the way we do things in the U.S. and many other countries. We need to find ways to change that reality quickly.
We cannot afford to operate in a highly regulated environment. The costs are high and regulation can thwart innovation. Yet, we can’t continue to absorb the costs of mistakes that are the result of bad decisions and lack of oversight. I hope you will join me in bringing a greater awareness to what it means to a continuous learner and participate in learning organizations. We all need to develop the competencies and skills to do this work. As Senge noted more than 20 years ago, it is time to give up the illusion that the world is created of separate, unrelated forces. We have seen this proven in many instances now. What Senge wrote two decades ago still holds true today: What we need are learning organizations "where people continually expand their capacity to create the results they truly desire, where new and expansive patterns of thinking are nurtured, where collective aspiration is set free, and where people are continually learning how to learn together."