This study examined the relationship between characteristics of a learning organization and multi-dimensional organizational performance. The study population consisted of executives and human resource managers within large, publicy-owned companies with headquarters or divisions located in Pennsylvania.
Although the learning organization is a frequently studied topic, there have been few empirical studies which have examined its relationship with organizational performance, especially performance which includes hard financial data. The survey instrument used to assess this relationship was the Dimensions of the Learning Organization Questionnaire along with both perceptual and objective performance measurements.
The seven learning organization dimensions under investigation included: (1) create continuous learning opportunities, (2) promote inquiry and dialogue, (3) promote collaboration and team learning, (4) empower people toward a collective vision, (5) establish systems to capture and share learning, (6) connect the organization to its community and environment, and (7) provide strategic leadership for learning.
Simple and stepwise multiple regression equations were used to examine the relationship between the learning organization dimensions and each of the following performance categories: operational, knowledge, financial, and organizational. Organizational performance is defined as the weighted combination of both perceived (operational and knowledge) and objective (hard financial) performance information. Hard financial performance metrics included gross profit margin, return-on-asset, and return-on-equity results for each target company over a period of 9 months preceding survey distribution.
Six research questions yielded various levels of results. The most frequently observed learning dimensions included continuous learning, community connections, and strategic leadership. One-way ANOVA indicated significant differences based on both company size and industry sector. Higher levels of team learning were recorded in smaller companies compared to larger companies. Higher levels of continuous learning were recorded in utility companies; higher levels of team learning and embedded learning systems were found in chemical producers; and higher levels of strategic leadership were found in the entertainment industry.
Stepwise regression of the learning dimensions indicated variance explanations of 28 percent for operational performance; 32 percent for knowledge performance; 6 percent for hard financial performance; and 18 percent for multi-dimensional organization performance. Multi-dimensional organization performance was proposed as the best overall performance indicator because it included both perceptual and objective types of measurements, including hard financial data. Furthermore, the best fit regression model for multi-dimensional organization performance indicated that the learning dimensions of community connections and embedded learning systems were the most important contributors to the model.