Small business development and the “learning organisation”

Abstract

The paper proffers a tentative conceptualisation of the``small business strategic learning process'', demonstrating the complexity of the small firm learning and management task. The framework, built upon personal construct theory and learning theories, is elaborated through the grounding of relevant areas of the strategic management literature in an understanding of the distinctive managerial and behavioural features of the small business. The framework is then utilised to underpin consideration of the concepts of``organisational learning'' and the``learning organisation'' within a small firm developmental context. It is suggested that whilst organisational learning may be a key and effective small business management approach to underpin sustainable development, the learning organisation, as currently conceived in the mainstream literature, fails to recognise and address the idiosyncrasies, problems and constraints relating to sustainable small business development. There does appear, however, to be great potential for extending understanding of the learning organisation concept into the small business context. An indicative research agenda is suggested.

Culture first, customers second : the case of an organizational learning culture in a successful small business.

“…Relatedly, Torres and Preskill (2001) define a process of organizational learning as continuous growth and improvement of an organization (p. 388). Organizational learning is also described as an organization's reaction to changes in its operating environment both internal and external (Graham & Nafukho, 2007;Wyer, Mason, & Theodorakopoulos, 2000). This is in agreement with Davenport and Prusak who state that as business environments change over time, the only consistent factor contributing to firm continuity is the way that firms generate and pass on knowledge.…”

“…This is especially true in qualitative research which does not aim to generalize findings. Wyer et al (2000) were among the first scholars to ardently suggest further investigation of organizational learning in the context of small business. They present several areas for investigation including how small business owner-managers challenge and adjust their mental models as a basis for a strategic adjustment to markets, products, and processes, the nature of learning interactions with external stakeholders, and how externally revealed fact and insight relating to unexpected unfolding change situations is contextualized into the small firm-specific context.…”

“…For example, Wyer, Mason, and Theodorakopoulos (2000) discuss the external operating environments faced by small businesses as typically uncertain and ever-changing. This type of environment requires highly complex decision-making.…”

“…Thus, if personal constructs prove ineffective for dealing with the environment, the assumptions upon which the constructs are founded must be uncovered, questioned, and then modified. The ability of owner-managed small businesses to identify and cope with open-ended change situations by reconstructing and modifying their existing personal constructs will determine the business's ability to sustain long-term growth (Wyer, et al, 2000).…”

Assessing the importance of managerial accuracy of perceptions

“…The world, as it is perceived, is a world where behavior is important (Robbins 1998, p. 90). Hence, managers, as individuals, do not react to stimuli, but to what we interpret the stimuli to be (Wyer et al 2000). Obviously, managers of different firms in the same sector can develop different interpretations or perceptions about their environment (Child 1972;Daft and Weick 1984), which influences their different reactions.…”