As the saying goes, it takes a village.

Granted, it may not be referring to corporate learning, but the sentiment still stands. 

Individual learning in the workplace is great, but to innovate and stay competitive, businesses need to scale learning to an organizational level.

This is known as organizational learning, and it’s essential if your organization wants to adapt to an ever-changing landscape, boost performance, and achieve business goals.

This guide covers the nuts and bolts of organizational learning, including:

• What organizational learning is
• The difference between organizational learning and knowledge management
• Why organizational learning is so important 
• The benefits of organizational learning
• Tips on how to foster organizational learning 
• How to build a learning organization 

What is organizational learning?

Organizational learning develops an organization’s ability to acquire, retain, and transfer knowledge. This is achieved by implementing a range of processes and systems that facilitate continuous learning in the business.  

This knowledge can be anything from learning more about the company’s ideal customer to how to create more effective workflows and processes. 

Whatever the knowledge in question, an organization needs to find ways to retain it and then transfer it to its members. 

So, there are three key parts of organizational learning: 

1. Knowledge creation—Organizations acknowledge new insights and new knowledge in their businesses 
2. Knowledge retention—They turn tacit knowledge into explicit knowledge, formalizing the insights and retaining them 
3. Knowledge sharing (transfer)—They share the explicit knowledge with relevant stakeholders 

These three functions allow companies and other organizations to create broad and dynamic knowledge bases that cover subject matter related to their activities. Then they transfer that knowledge through various types of corporate and employee training.

Up next, we’ll discuss the difference between organizational knowledge and knowledge management.

Organizational learning vs. knowledge management

The main difference between organizational learning (OL) and knowledge management (KM) is that organizational learning focuses on the process of learning, while knowledge management focuses on learning content. 

Dr. Edward Rogers, chief knowledge officer at NASA’s Goddard Space Flight Center, describes the distinction as being a difference in approach. OL focuses on teams and organizations that need to become smarter, which depends on individual learning. On the other hand, KM starts with a focus on the knowledge itself and tries to see past the individual. 

Another way to understand the relationship between OL and KM is that organizational learning is the end goal of knowledge management. By fostering the creation, retention, and transfer of knowledge, KM initiatives pay off because they help organizations embed knowledge into their processes. This enables companies to have continuous learning and, as a result, keep improving their practices and behaviors to help them achieve their goals. 

Human Resources departments and other learning stakeholders often use the two terms interchangeably. In the end, the distinction between OL and KM is primarily academic. 

On the ground, both OL and KM aim to assist organizations with creating, retaining, and sharing knowledge.

So, why is organizational learning so important? All will be revealed in the next section. 

Why is organizational learning important?

From sales training to compliance training, most companies invest heavily in employee  learning and development.

And with good reason—the benefits are huge. That said, these forms of training are very focused on individual employees. 

On the other hand, organizational learning aims to go beyond individual and group learning and embed knowledge into every activity of a company. This gives organizations access to a lot more knowledge and information that they can use to guide decision-making and problem-solving. 

With great innovation and technological development come new opportunities and challenges for businesses.

Just think of social media. Fifteen years ago, companies needed just a website and an email. Today, there are entire departments dedicated to social media strategies.

Companies that want to stay competitive have to pursue continuous improvement, and this isn’t possible if team members don’t share and pass on knowledge among themselves. 

It’s a very similar idea to collective learning. Human beings live in groups and organizations, so if there’s no system to share and retain knowledge on a group level, it gets forgotten. 

For instance, a manager in your company may have picked up some great productivity hacks through their years of experience. If there’s a system in place to share and retain this knowledge, then the whole organization can benefit from it. 

In the next section of this guide, we’ll dive deep into exactly what sort of benefits you can see from organizational learning in your company.

Five benefits of organizational learning

Organizational learning isn’t just a theory in organizational sciences. It’s a process that can provide many benefits to your company and your team members. 

From increased employee engagement to being able to spot and take advantage of new trends and technologies, there are a lot of reasons why companies choose to take organizational learning seriously. 

Let’s take a closer look at those benefits now. 

Benefit #1: Development of new skills

If your company adopts organizational learning techniques, it’ll naturally have a lot of knowledge in its organizational memory. Think of that as a vast knowledge base containing a lot of useful know-how on various parts of your business. 

The idea here is to make learning a natural part of your organization’s processes. Eventually, you should have a learning culture. 

In a learning culture environment, employees are comfortable with learning and trying new things because employers reward them for learning. This removes the fear of failure and empowers the workforce to tackle new challenges and skills. 

On an individual level, employees will have higher motivation to participate in your learning and development activities. With higher motivation comes better engagement and more knowledge retention. 

Between the individual level and the organizational levels, there is a positive feedback loop. The more knowledge an organization creates and retains, the more it can share with its members. 

The result is a workforce that engages in constant professional development and continually learns new skills.

Benefit #2: Sharing experience 

A large part of organizational learning is knowledge sharing. It makes sense employee knowledge that isn’t shared doesn’t benefit the organization as a whole. 

Learning organizations share knowledge freely and widely. When team members go through various experiences, the organization can retain and learn from them.

So, if one team has tried a particular strategy, everyone else can learn from the failure or success. 

Companies that learn continuously and share knowledge adapt more easily to customer demands, market conditions, and other external factors. 

Also, because the organizational memory “stores” all the knowledge and experience, companies can avoid repeating mistakes. 

That’s why empowering employees to freely share insights, information, and knowledge is so important. It prevents particular departments and teams from siloing experience and know-how. 

Benefit #3: Employee engagement

We all know how important employee engagement is. Higher productivity, decreased employee turnover, etc., the business benefits speak for themselves. 

But, as it stands now, according to surveys, only 15% of employees feel engaged at work. 

If you think that’s not a big deal, we’ve got news for you. According to those same surveys, the lack of engagement equals $7 trillion in lost productivity. So, the link between learning strategies and business goals is clear now.

Luckily, learning can be a powerful source of employee engagement. This is especially true for the millennial workforce. According to a Gallup survey, millennials want jobs to be learning opportunities. 

That’s not to say that classic workplace incentives such as remuneration and perks aren’t important, but more and more employees also want a sense of purpose and support in their professional development efforts. 

In the coming decades, it’s quite clear that workplace learning will be the driver of employee engagement. So, there’s no time like the present to take it seriously and give your employees what they want. 

Benefit #4: Improved productivity

Improved productivity flows from boosted employee engagement. It’s common sense, really, but we do have the stats to back this up. 

According to case studies from Gallup, companies with highly engaged employees see a 21% increase in productivity and a 22% increase in profitability. 

These are findings that you simply can’t ignore. 

And that’s just the benefit that comes from higher engagement. 

When employees have opportunities to learn and develop, they get better at their jobs. 

That’s why companies should foster organizational learning at every level. From formal training to mentorship and informal learning. 

The dual benefit of learning through increased know-how and engagement is something that companies can’t afford to sleep on.

Benefit #5: Innovation fostering

Innovation is the lifeblood of any business. Just look at the many examples of companies that dropped the ball by not fostering innovation. 

There’s Nokia, a company that went from dominating the cell phone market to being a bit player in the new smartphone field. Nokia failed to grasp just how important the shift to app-centric design, led by Google and Apple, was compared to their device-centric approach.

RIM, the company behind the once ubiquitous Blackberry smartphones, is another example coming from the mobile phone industry. 

Finally, we have Kodak, the company that practically invented digital photography, but for baffling reasons, chose not to pursue this new product commercially. 

What all these three examples have in common is that they tried to defend the status quo when they should have pursued innovation. 

Being a learning organization is one way to not fall into this trap. When companies freely and widely share knowledge, it’s a lot harder to fall into a rut and miss out on the opportunities that new technologies and ideas can bring. 

Learning organizations have the kind of agility to adapt and thrive in fast-paced markets and industries. 

By this stage, you’re probably ready to implement organizational learning in your company. Here are a few tips for success.

Four organizational learning tips to keep in mind

Organizational learning is a powerful approach to learning and development. At first glance, it may seem like an academic thing, but the results are very much rooted in the real world.

You’ll be glad to know that the road to adopting organizational learning is more straightforward than you’d think.

Follow these tips to design an organizational learning strategy that works for your business. 

Tip #1: Encourage employees  

This one is really about follow-through. If your commitment to organizational learning begins and ends with updating the mission and vision sections on your website, you won’t see benefits from it. 

Organizational learning needs to be a shared vision in the entire organization. Organization learning means that everyone in the company is developing. 

There are a lot of ways to encourage employees to devote their time to learning. You don’t have to go full Google and give team members one day a week to work on their projects, but you can set aside some time for your employees to participate in various learning activities. 

Offering personalized learning pathways and gamified learning content increases learner engagement considerably. 

A 2019 report from Deloitte shows that learning is rarely linked to promotions. That’s something you might want to consider changing in your company. 

What better way to show you’re serious about learning than motivating your employees with financial and career incentives? 

Company leaders and managers should also lead by example. Everyone learns in a learning organization. Make sure that your actions align with your messaging. Recognize and reward any new solutions and ideas your employees come up with, even if they don’t end up being revolutionary. 

Tip #2: Develop mentoring systems

We’ve talked about formal training, but don’t forget about informal learning. Any time a team member asks someone about a particular task or a way of doing something, that’s informal team learning. 

Mentoring is a very interesting learning experience because it combines formal and informal approaches. The program and the assignment of mentors to mentees make it formal, but mentees will mostly pick up new skills and insights from mentors as they develop their relationships. 

Implementing mentor systems is a great way to foster all types of learning in your organization. It’s an inherently engaging way to learn, which leads to very high knowledge retention. 

The best way to implement this is to identify your most skillful and knowledgeable employees (overachievers in one word) and motivate them to act as mentors to younger and more inexperienced team members. 

Many companies already do a form of mentorship during employee onboarding with buddy systems. There’s no reason not to make mentorship a permanent part of your learning and development strategy.

Tip #3: Create a learning environment

Creating a learning environment is an essential step. A learning environment at work means that your company is a safe space for new ideas, experimentation, and also failure. 

Employees should know you’re open to new ideas and different points of view. This is separate from whether or not you’ll implement those ideas. But, if employees feel that their employers will simply ignore their contributions, they will be unlikely to share anything. Even something that might be good and useful. 

So, you need to open up the space for the unexpected. Try to make sure that the workload allows your teams some downtime to reflect on how to do things and brainstorm new ways of tackling challenges.

Even if those ideas don’t end up panning out, prep employees to feel okay with that. Failure often happens when experimenting, and it’s an opportunity to glean some knowledge by analyzing how and why something failed.

Tip #4: Gather feedback

Ask any learning experience designer, and they’ll tell you that feedback is a critically important part of any learning initiative. 

After all, the point of organizational learning is to unite the entire organization in a shared vision. That is to say—everyone’s a stakeholder. 

So, you should solicit and consider the feedback you get from team members at every organizational level—C-suite, middle management, and rank-and-file employees. 

Through this feedback, you’ll be able to identify any weak points in your learning and development strategy and the individual learning experiences that you offer to team members. 

Perhaps some employees are being asked to take online courses that are not relevant to their field and position. Or certain learning modules are just not very engaging, so few people complete them. 

Whatever the case, by encouraging a culture of open and constructive criticism, you’ll get to the bottom of why some parts of your learning strategy are not performing well. You’ll also get a lot of ideas on how to make them better. 

Now that we know all this, we get to the good part. How do we build a learning organization? We’ll give you a step-by-step guide in the next section. 

Five steps to building a learning organization 

It’s time. This is the part where we tell you exactly how you can start building a learning organization. 

And in case you need a reminder, a learning organization is one with a high capability to acquire, retain, and share knowledge.

This concept was first popularized by Peter Senge in his influential book “The Fifth Discipline.” 

Now let’s see how to become a learning organization in five simple steps.

Step #1: Set up an online learning infrastructure

In the past, most corporate training was face-to-face. You had your instructor, your trainees, and whatever room you could briefly repurpose to serve as a classroom. 

These days, that’s a very outdated model. Technology has marched forward as it is wont to do, meaning there are many more learning modalities to take advantage of. 

Online learning, in particular, is now the strongest trend in corporate training. We won’t get into all the benefits of online training here, but suffice it to say—it’s more accessible, it’s more engaging, and it’s cheaper to boot. 

To set up an online learning infrastructure, you’ll first need to pick a good Learning Management System (LMS). 

What’s a good LMS? It’s a learning system that enables you to easily create and deliver online learning courses, first and foremost. Through an LMS, you can also take advantage of modern approaches to learning, such as microlearning and gamification.

Make sure to pick a SCORM-compliant LMS because then you’ll be able to easily mix and match learning modules and integrate training content from vendors into the content you’ve made yourself.

No good learning organization is complete without training data. LMSs also have a lot of built-in metrics that give you information on learner progress, course completion rates, learner engagement, etc.

Step #2: Develop measurable performance criteria

Look, all that talk about experimentation and the free flow of ideas is all well and good. But at the end of the day, businesses have to be rational about what they do.

You’ll get nowhere without measurable performance criteria. You need to know how all those learning and development initiatives you’re conducting are performing. Are the employees learning? Are they engaged and motivated? Is all that learning affecting your bottom line?

These are questions for your learning stakeholders, your Human Resources departments, and upper management. 

The exact criteria you’ll use will depend on the type of your business structure and goals. 

Luckily, the best LMSs come with lots of ways to gauge and assess learning, so be sure to make use of all that actionable data. 

Because each business has different needs, we can’t tell you exactly which metrics to keep track of and how. There’s no one-size-fits-all approach here. 

But you could start by pulling LMS reports to answer the following questions:

• How many employees are using training resources? (check data on views, course completion rates, etc.)
• How many employees are engaging with training content? (look at comments, drop-off rates, number of shares, etc.)
• How often are staff members logging in to the LMS?
• How long are employees staying on the LMS (pull data on session times)

Step #3: Create online training advocates

Change is hard; organizational change is even harder. While you may have good reasons to implement new training initiatives and pursue becoming a learning organization, your workforce might not see it that way.

It’s your job to get everyone on board. Remember, it’s all about having a shared vision that learning is important and useful.

The way to get everyone on the same page is to transform your managers and team leaders into online learning advocates. Your team leaders should have all the information and resources to be able to offer support and guidance to their subordinates. 

Team leaders also need a safe place to vent any problems and frustrations. A private group in whatever team communication app you’re using is enough. In that group, team leaders can exchange experiences and information on how to promote any new learning programs. 

Make sure to also equip your team leaders with knowledge on how to deal with any technical roadblocks that might arise. They should be able to solve basic problems with LMS access for employees, for instance.

Step #4: Create a knowledge base

So far, we’ve talked a lot about how to create and share knowledge. But what about retention, one of the central pillars of organizational learning?

Your team members are constantly uncovering new knowledge about your business, customers, and environment. 

Yet, if there’s no way to retain it, you can’t share it effectively. 

To retain knowledge and make it easily shareable, you need a knowledge base. This is a collection of documents, training programs, and any other data and information that’s relevant to your business. 

A knowledge base is part of what corporate learning gurus would call a knowledge management system. Don’t let the name fool you, though, it’s less complicated than it seems. 

Knowledge bases can live on your company’s intranet, a cloud platform such as Google Docs, or your LMS. Or even a combination of these. 

Building a knowledge base within your LMS makes a lot of sense. It’s already where employees go to train and develop their skills, so it’s a platform they’re comfortable using. 

Plus, thanks to LMS analytics, you can track how much value employees are getting from it.

The most important thing to remember is that a knowledge base should be easily accessible and regularly updated. 

A knowledge base facilitates all three main parts of organizational learning:

• Creation: Everyone can collaborate on documents, jot down notes, draft training programs, etc. 
• Retention: The knowledge base is a central source of knowledge in the organization
• Transfer: Employees can easily share relevant materials with their colleagues that require them, such as during onboarding. 

Step #5: Support learner autonomy

Now’s a good time to remind ourselves of the main takeaway from adult learning theory – adult learners need a sense of autonomy and freedom in their learning experiences. 

Adults are not children (Earth-shattering insight, we know ). So, you need to treat them properly if you want to engage and motivate them to learn. 

Learner autonomy is a powerful way to motivate learners. In training programs that support learning autonomy, individual learners get to create their learning strategies and processes and identify their own learning opportunities. 

Why is this important in light of setting up a learning organization? Remember—a shared vision. If learning is only ever top-down, then that isn’t a learning culture and a learning organization. It’s just a collection of mandatory training courses. 

To engage employees and turn them into learning stakeholders, you need to give them the freedom to pursue their own learning goals within the organization.

There you have it; your complete guide to organizational learning. Before you run off to put all this new knowledge to good use, here’s a quick recap.

Now over to you

Organizational learning is the process where organizations effectively create, retain, and share knowledge. It’s a necessary component of any organization that wants to be innovative, adaptable, and competitive in a rapidly changing business and technological environment. 

Supporting organizational learning makes employees more engaged and productive and fosters a culture of learning and innovation in a company. 

To transform your company into a learning organization, you’ll need an LMS to create, manage, and track learning at a company-wide level. 

Ready for more? Head over to our learning glossary for the latest insights on L&D and digital learning.