A learning organization has developed the continuous capacity to adapt and change. The Dimensions of the Learning Organization Questionnaire (DLOQ) has been adopted and adapted internationally to assess the degree of commitment to learning organization principles. Proponents of the learning organization envision it as a remedy for three fundamental problems of traditional organizations.

Fragmentation based on specialization creates “walls” and “chimneys” that separate different functions into independent silos. An overemphasis on competition often undermines collaboration. Reactiveness misdirects management’s attention to solving problems rather than creating. The problem solver tries to make something go away, while a creator tries to bring something new into being.

What can managers do to make their firms learning organizations? Establish a strategy. Management needs to make explicit its commitment to change, innovation, and continuous improvement. Redesign the organization’s structure. Flattening the structure, eliminating or combining departments, and increasing the use of cross-functional teams reinforce interdependence and reduce boundaries.

Reshape the organization’s culture. Managers must demonstrate by their actions that taking risks and admitting failures are desirable. This means rewarding people who take chances and make mistakes. They also need to encourage functional conflict.