CHAPTER TWO Review of Literature
2.26 Kogut and Zander Knowledge Management Framework
2.27.1 Literature supporting the use of the Framework
Pemberton and Stonehouse (2000) posited that a successful organisation is one that creates an organisational environment that combined organisational learning with KM. Vance (2011) found that that organisations needed to scan the environment in which they operated and collect information to shape future decisions, as this would facilitate organisational learning for the institutions. Furthermore, in today’s fast changing environment, strategic decision making through organisational learning becomes crucial for organisations to quickly respond
86 and adapt to changes in their business setting in order to stay competitive and survive (Bhatt and Zaveri, 2002). Bhatt and Zaveri (2002) utilised the Argyris and Schön (1978) model to build a framework to show how a Decision Support System can enhance organisational learning. The authors used data scanning construct to collect data from the external environments and convert it into relevant information. By utilising the feedback mechanism, this allowed for errors to be identified and corrected in a repetitive way which eventually led to reliable information (knowledge). Action could then be taken based on that knowledge. A decision support system based on Argyris and Schön (1978) can assist management of almost any firm in finding the best solution consistent with their organisation’s overall goals and mission (Bhatt and Zaveri, 2002).
Organisational learning does lead to strategic decision-making and this is supported by Argyris and Schön (1978; 1996). Hence, decision-making and organisational learning become interlinked. Bettis-Outland (2012) asserted that in many cases, comprehensive and strategic decision making is more successful in turbulent and competitive business environments. Argyris and Schön (1978) put forward that for an organisation to remain competitive in a changing environment, the organisations goals and action plans to reach those goals needs to change as well. Furthermore, when productive or beneficial decisions are made, organisations are more inclined to repeat its actions expecting positive outcomes.
Whereas, whenever a bad decision is made which leads to bad actions, there is then an inclination to carefully assess each step made to determine what led to the bad decision with an intention to avoid or repair any bad steps in the future (Bettis-Outland, 2012). As posited by Argyris and Schön (1978), actions and outcomes must be linked and those outcomes must be remembered.
It was also suggested by Argyris and Schön (1978) that problem solving within an organisation is indeed a learning process that stimulates knowledge creation and fosters innovation. Based on this, Hung, et al. (2011) set out, in a Taiwanese industrial setting, to establish if organisational learning fostered innovation and to define the relationship between organisational learning and innovation to enhance Total Quality management (TQM). It was shown that organisational learning did have a significantly positive effect on innovation and how both organisational learning and innovation enhances TQM in various organisations (Hung, et al., 2011).
87 Organisational learning fosters a learning culture within an organisation and this is supported by Argyris and Schön (1996) and can be correlated to strong organisational culture (Phang, Kankanhalli and Ang, 2008) in which people working and learning together can support an organisation’s goals (Schein, 1985). Organisations learn from experiences about which parts of their existing knowledge works best for the organisation holistically (Schein 1990).
Similarly and motivated by the IT-related environmental changes, Phang, Kankanhalli and Ang (2008) constructed a framework that combined Schein (1985) and Argyris and Schön (1996) and applied it to an e-Government project implementation. The framework highlighted the correlations between organisational culture and organisational learning and how it impacted positively on the e-Government project by allowing the project team to be able to readily adapt to IT–related changes posed by the external environment.
Garcia-Morales, Llorens-Montes and Verdu-Jover (2007) looked at the dynamic capabilities of organisational learning and its impact on innovation in a Spanish context using 401 firms.
Using the theories of Argyris and Schön (1996) they highlighted organisational learning as a positive facilitator of organisational performance and innovation. It is important to understand that management support for organisational learning was vital to ensure that the organisation developed a learning culture which could inevitably favour innovation (Garcia- Morales, Llorens-Montes and Verdu-Jover, 2007). Other studies that highlight organisational learning promoting innovations include Liao, Fei and Liu (2008). Organisational learning is also key to enhanced performance and a competitive advantage (Jiménez-Jiménez and Cegarra-Navarro, 2006). It was shown that market orientation strongly influenced organisational performance when it was facilitated by organisational learning. Furthermore, organisational learning empowered an organisation to progress from a given situation to a desired situation of enhanced performance and market orientation.
Similarly, Bontis, Crossan and Hulland (2002), Farrell and Oczkowski (2002) and Tippins and Sohi (2003) asserted that that organisational learning inevitably has a positive impact on organisational performance. Janz and Prasarnphanich (2003) investigated the correlations between organisational learning, organisational climate and job characteristics and its influence in creating a knowledge centred culture in favour of knowledge creation and knowledge dissemination. Results of the study in concurrence with Argyris and Schön (1978), confirmed that there is a direct link between organisational climate and organisational learning. The nature of an employee’s job often determines the level and motivation of
88 learning, as organisational learning has a strong influence on work satisfaction and work performance (Janz and Prasarnphanich, 2003). Hence, an organisation with a knowledge centred culture in which the organisational climate promotes organisational learning is shown to yield substantial benefits such as more knowledgeable employees, increased performances, operational efficiency, employee satisfaction and more (Janz and Prasarnphanich, 2003) and this could easily correlate with Argyris and Schön (1996) when they posited that when all members of an organisation are mindful of intellectual outcomes including work processes, learning transforms into overall organisational learning. Similarly, a learning culture in which people work and learn together can support an organisation by fostering a knowledge- creating system (Wang, Yang and McLean, 2007).
From an educational setting, Garcia-Morales, Lopez-Martin and Llamas-Sanchez (2006) utilised the theories of Argyris and Schön (1978; 1996) and showed how the personal and professional development of educators encourages the creation of a shared vision and team learning in an educational setting. This in turn favours organisational learning and yields an improvement in organisational performance as well as competitiveness (Garcia-Morales, Lopez-Martin and Llamas-Sanchez, 2006). Similarly, Barth and Rieckmann (2012) emphasised the role of organisational learning in HE to promote ‘Education for sustainable development’ (ESD) which was supported by (Argyris and Schön, 1978; 1996). Education for sustainable development showed significant benefits for HE in terms of initiating individual learning processes and facilitating social learning (Barth and Rieckmann, 2012).
However, it posed a challenge in university curricula to promote ESD. This was mainly due to academic staff resistance and their non-willingness to support such processes. By applying the theories of Argyris and Schön (1978; 1996) to a HE institution, it allowed academic staff to see the benefits of ESD, thereby allowing them to change their strategy into incorporating ESD within the institution. This also impacted positively on the general organisational development of the institution. The preceding study related well to an earlier study by Peck, et al. (2009) who argued that environmental change in education is escalating significantly in both developed and developing countries and this required education institutions to strategically embrace that change. The authors referred to Argyris and Schön (1996) in building a framework that could assist in the strategic change/transformation of education by deducing complex social processes that formed the basis of organisational innovation, and change (Peck, et al., 2009). By allowing an organisation to ‘learn’, they can simultaneously
89 contribute to improvement of organisational learning capacity and outcomes (Argyris and Schön, 1996).
This study utilises all three constructs of Argyris and Schön (1978). The Data Collection constructs plays a vital role in KM. The Interpretation construct will epitomise KM in the sense that data collected becomes meaningful. Lastly, the Learning construct signifies what has been learnt and what actions have been taken based on the knowledge gained throughout the process.