What makes an organization truly a ‘learning organization’? According to MIT’s Peter Senge, learning organizations are those in which people continually expand their capacity to create desired results. New ways of thinking are encouraged, and more importantly, where people learn to see the whole together. He believes that in situations of rapid change, only those organizations can excel in which the commitment and capacity to learn are encouraged at all levels.

But isn’t it intuitive and self-evident that one should continue learning and not resist the need to do so? What is the significance of being a ‘learning organization’ at this particular moment in time?

Needless to say, business organizations have suffered unprecedented setbacks since the outbreak of Covid-19 in 2020. From supply chain disruptions to global inflation followed by the Russia-Ukraine war and everything in between. For the sake of simplicity, let us call it ‘crises’. Crises give organizations and leaders an opportunity to revisit their business strategies, goals, and purposes.

We must admit that crises are not just unfortunate phenomena; they create conditions that invite interpretation, dialogue, and reflection. Crises tell us that we need to pause, take a step back and turn our attention inwards. Think about where we are, how we got here and decide whether a change of direction is warranted. This becomes increasingly urgent as the interval between crises becomes shorter and shorter.

Again, this may sound self-evident. However, I would like to quote economist Mohammad El-Erian, who recently published an article, Not Just Another Recession, Why the Global Economy May Never Be the Same. After mentioning the crises we currently face, he states:

“Yet, for the most part, economists and financial analysts have treated these developments as outgrowths of the normal business cycle. From the U.S. Federal Reserve’s initial misjudgement that inflation would be “transitory” to the current consensus that a probable U.S. recession will be “short and shallow,” there has been a strong tendency to see economic challenges as both temporary and quickly reversible.”

Turning our attention toward a more fundamental problem underpinning this view which demonstrates that our experts are merely treating the symptoms of the disease and not the disease itself.

Two problematic yet critical pre-suppositions must be highlighted. First, decision-makers have assumed that these challenges are temporary. Once the Pandemic is over and the economy recovers and once the war ends—it will be business as usual.

This is because they have a mechanistic view of reality. The Universe is like a complex machine, reducible to fixed mechanical laws; therefore, outcomes are fully predictable. The economy works similarly. Markets are self-correcting, and they will eventually stabilise. Hence, no need for any external interference. Consequently, corporations have used strategies that are essentially about ‘buying time’.

Second, decision-makers have assumed that the management model is sound and need not be questioned, let alone radically changed. They assume that better alternatives either do not exist or, if they do, are too utopian for the real world. Any attempt to modify how businesses run is futile because the current model cannot be improved, or the effort required is not worth it. In effect, all we need is minor, incremental changes.

This is a good example of uncritical pre-suppositions turning into rigid beliefs. Highlighting similar issues in the natural sciences, Rupert Sheldrake claims that science has been held back due to centuries-old assumptions which have hardened into dogmas. And just like in the case of management theories, problems within science are also taken for granted with the hope that they will eventually be solved through more research. There is neither a need nor the will to introspect to identify deeper issues.

Organizational pre-suppositions are usually ‘known’, but are not discussed, nor are they written or easily found. They comprise unconscious thoughts, beliefs, perceptions, and feelings. One example could be a rather prevalent yet unconscious belief that only men can be effective leaders.

In Teaching Smart People How to Learn, Chris Argyris explains that leaders fail to see through routine techniques because many professionals have historically been successful at what they do; as a result, they rarely experience failure. Consequently, they never learn to learn from failure.

Many business leaders always go back and forth between different strategies while avoiding reviewing and revisiting their underlying presuppositions. This is called Single Loop Learning. Although this strategy is helpful under normal circumstances, it does not enable us to navigate complex and chaotic situations.

Chris advises us not to stumble upon the Single Loop Learning trap and instead adopt a Double Loop Learning approach to navigate crises and their aftereffects.

This is summed up rather poetically by Eric Hoffer: “In times of change, learners inherit the earth, while the learned to find themselves beautifully equipped to deal with a world that no longer exists.”

Authors: Ahmad Bilal: CEO of Trade Expeditors Pakistan (Pvt) Ltd
Danish Kayani: Researcher on Business Ethics and Philosophy of Economics