TMS: Organizational Learning (plus a bit of CI & TQM thrown in)

1. TMS: Organizational Learning (plus a bit of CI & TQM thrown in) Frances Jørgensen frances@plan.aau.dk

2. Organizational Learning What do we mean by ”organizational learning”? ”The Learning Organization”? Why the interest in organizational learning? What has organizational learning to do with your projects?” How do we measure organizational learning? What are some of the challenges to creating a “Learning Organization” and/or for establishing Organizational Learning? Learning objective: for the student to gain an basic understanding of organizational learning from theoretical and practical perspectives, especially in terms of how these relate to organizational structure, systems, and processes.

3. What do we mean by Organizational Learning? • How can an organization learn? • Individual learning? • Group learning? • More? • How do we know that an organization has learned?

4. Learning as Change • Arygris and Schön (1978): a process of detecting and correcting error (behavioral, observable, measurable). • Probst and Büchel (1997): the process by which the knowledge and value base changes, leading to better problem-solving and capacity for action (cognitive with expectation of behavioral changes) • Friedlander (1983): also changes that lead to new insights and understanding

5. concrete Doing Reflecting Plan The Kolb learning cycle Act Do Deciding Thinking Check abstract active reflective Learning Cycles…from individual to group to organization? PDCA Cycle

6. Levels of Organizational Learning • Single-loop learning: following present rules/policies to achieve present objectives (Arygris, C. and Schön, D. Organizational Learning, Reading, Mass: Addison-Wesley). • Double-loop learning: modification of rules/policies to achieve new objectives (ibid) • Deutero-learning: learning from learning (Bateson,1973)

7. How do we know if/when an organization has learned? • Learning as a result: learning has occurred if there is improvement of results • Learning as a process: routines change as a result of accumulated experiences

8. An Organization “Memory” • Experience from learning processes are stored in the organization’s “memory”—routines, norms, procedures, beliefs, stories, strategies, and technology. • Experiences can also go against formal routines and procedures. • Experiences are transferred through socialization, education, imitation, transfer of personnel, mergers, acquisitions, etc. • Experiences can survive after those involved leave the company; new employees may follow the routines developed from experience but often lack the background on which those routines were based.

9. Eleven Characteristics of the Learning Company • A Learning Approach to Strategy • Participative Policy Making • Informating • Formative Accounting and Control • Internal Exchange • Reward Flexibility • Enabling Structure • Boundary Workers as Environmental Scanners • Inter-company Learning • A Learning Climate • Self-Development Opportunities for All (Pedler, Burgoyne, and Boydell, 1997)

10. A Learning Organization needs … • Systematic problem solving • Experimentation with new approaches • Learning from past experiences • Learning from the experiences and best practices of others • Transferring knowledge quickly and effectively through the organization (Garvin, 1993)

11. Continuous Improvement • is defined as… • ”...the planned, organized and systematic process of on-going, incremental and company-wide change of existing practice aimed at improving company performance (Boer et al., 2000).” • is based on… • Continuous development & learning • Full utilization of employee potential • Employee responsibility for improvement

12. CI Innovation Capability 5 Strategic CI 4 Proactive/Self-driven CI 3 Goal Directed CI 2 1 Systematic CI Natural CI TIME

13. Kaizen (Imai, 1986) • Kaizen: • Process-oriented: results can only be improved if processes are improved • People-oriented: based on the belief that people’s natural desire for quality and value, and that it will pay for itself in the long run. • Standard-oriented: standards are required in order for improvement to occur.

14. What is it all about? It’s really very simple! Basically, when you have done something, think about what has been done and try to do it better the next time!

15. 1 technician from each of 4 teams goes to the manager’s office at least once each day Accounting : • workdays i 1997 = 230 days • Distance to office = 2x90 =180 m there and back • 4*180*230 =165.600 m ~165 km Conclusion • If these trips are cut by just one ½, 83 km walking is saved. What about coordinating the teams? What about another form of communication?

16. Balancing Radical Change & CI continuous improvement Practice or performance standard maintenance continuously improved practice or performance standard radical innovation maintained practice or performance standard practice or performance standard development without maintenance radical innovation Time Kilde: Imai, 1986

17. FEATURES KAIZEN INNOVATION Effect Long term and long lasting, undramatic Short term but dramatic Pace Small steps Big steps Timeframe Continuous and incremental Intermittent and non-incremental Change Gradual & constant Abrupt and volatile Involvement Everybody Select champions Approach Collectivism, systems approach Individual ideas and efforts Kaizen/Innovation Comparison (Cole, R., CI2000 Conference, Aalborg)

18. Kaizen/Innovation Comparison (cont’d) FEATURES KAIZEN INNOVATION Maintenance & Improvement Mode Scrap and Rebuild Spark Conventional know how Tech breakthrough Practical Requirements Requires little investment, lots maintenance Requires great investment, little maintenance Effort Focus People Technology Evaluation Criteria Process focus Results focus Works well in slow growth economy Suited to fast growth economy Advantage

19. The Maturity Model • Natural CI: No formal CI structure, problem-solving is seldom & often conducted by specialists. • Systematic CI: Formal attempts at creating, supporting, and maintaining CI; formal problem-solving procedures are used and supported by basic CI tools. CI often run parallel to work processes. • Goal-oriented CI: In addition to above, formal diffusion and application of strategic goals, with monitoring & measuring of CI in relation to these goals. • Pro-active/self-driven CI: In addition to above, with the responsibility for CI being assumed by the problem-solving units themselves (department, groups, etc.) • Strategic CI: Full implementation…the learning organisation, a dominate lifestyle involving all in organisation. Active learning occurs naturally and is shared automatically. Combined large & small innovations

20. Key Aspects of CI • Suggestions, support of recognition, pay, and educational systems • Application of production techniques & quality-related management methods, tools, and techniques. • Individual & group-based contribution (within and across functions) • Not “obligatory” or “volunteer”; rather, normal, daily activities. • Organization-wide support & involvement (production, management, departments e.g. product/process development)

21. Key aspects of CI (cont’d) • Top down / bottom up; planned, strategy driven and “emergent” contributions to strategy development. • Various levels of integration between action and reflection: PDCA cycle (problem identification/solution proposals in Japan/USA); full ownership of entire cycle (analysis, solutions, implementation in Scandinavia). • Encourage individual & organizational learning as part of daily activities • Numerous projects occurring simultaneously; not hit and miss • Not just in production; moving into service areas • Not just internal processes; moving into supply chain and networks

22. Benefits of CI • Small improvements in quality, costs, delivery time, safety, job improvement, etc. • Establishes foundation for other (larger) improvements (i.e. radical changes) • Maintenance & improvement of larger changes (e.g. Lego maintenance of BPR project results) • Development of competencies, learning, self-management (e.g. Coloplast autonomous teams)

23. Plan Do Check Act Planning and preparation, based on an analysis of existing practices and performance Plan Act: The new practices are standardized but opportunities for further improvement remain open Do: Implementation of the plan Check Check whether changes have resulted in expected improvements

25. TQM • A change in organization’s technology (way of doing work), in the organization's culture (its norms, values, and belief systems), and a change in an organization's political system (decision making processes and power bases), with the objective of satisfying internal and external customers and suppliers . • Significant changes cannot be expected unless all of these dimensions are aligned. TQM implemented as simply technological change will not be successful (Tichey, 1983).

26. TQM Total = Quality involves everyone and all activities in the company. Quality = Conformance to Requirements (Meeting Customer Requirements). Management = Quality can and must be managed. TQM = A process for managing quality; it must be a continuous way of life; a philosophy of perpetual improvement in everything we do.

27. Principles of TQM • Quality can and must be managed. • Everyone has a customer and is a supplier. • Processes, not people are the problem. • Every employee is responsible for quality. • Problems must be prevented, not just fixed. • Quality must be measured. • Quality improvements must be continuous. • The quality standard is defect free. • Goals are based on requirements, not negotiated. • Life cycle costs, not front end costs. • Management must be involved and lead. • Plan and organize for quality improvement.

28. Implementing TQM • A first step in TQM implementation involves assessing • the current state of the organization (history, needs, • preconditions, factors leading to decision to adopt • TQM, and employee relationships). • One method of conducting this assessment is the • force field analysis

29. Sample Force Field Analysis

30. Process management and improvement • Define the process • Measure process performance (metrics) • Review process performance • Identify process shortcomings • Analyze process problems • Make a process change • Measure the effects of the process change • Communicate effects to all parties