Introduction

Regardless of size and industry, the majority of organizations devote considerable time and resources to developing unique, profitable competencies. Many researchers and organizations look to knowledge to provide this competitive advantage (Crossan, Lane and White, 1999; Van de Ven, 2005), with the expectation that knowledge can be made to contribute to a firm's performance (Watson and Hewitt, 2006) when it is efficiently integrated with existing intellectual capital, and converted into unique, revenue-generating products or services (Appelbaum and Gallagher, 2000; Teare and Rayner, 2002; Turner and Makhija, 2006; Van de Ven, 2005). As Nonaka emphasized (1991: 96), “one sure source of lasting competitive advantage is knowledge”.

But why are some organizations better at achieving “competitive advantage” through organizational learning than others? To better understand this question, we delve back into the basics on organizational learning and outline the necessary steps an organization should take to implement organizational learning.

There is general consensus in the research literature and the popular press that several key factors are needed to implement and embed “organizational learning” into the fabric of an organization (Figure 9.1): (1) the influence of leadership on individual and organization culture; (2) creating a culture conducive to organizational learning; (3) improving the quality of knowledge the individual acquires, while facilitating the sharing of that knowledge with others in the organization; (4) generating new, actionable knowledge as a result of the knowledge shared or transferred within the organization; and (5) developing a competitive advantage with the newly, generated knowledge (a knowledge-based advantage).