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The learning
The learning organization: organization
variations at different
organizational levels
455
Teresa G. Weldy and William E. Gillis
Department of Management, Mitchell College of Business,
University of South Alabama, Mobile, Alabama, USA

Abstract
Purpose – The purpose of this paper is to examine the perceptions of managers, supervisors, and
employees from different organizations relevant to the seven dimensions of a learning organization
(LO), and the two dimensions of knowledge and financial performance.
Design/methodology/approach – The perceptions of 143 organizational members from different
levels of four organizations were measured and compared using the Dimensions of a Learning
Organization Questionnaire (DLOQ).
Findings – ANOVA results indicated significant effects for level and organization for the LO
dimensions and the two performance dimensions. The results indicated significant differences across
levels for two of the learning dimensions (empowerment and system connections), and across
organizations for six of the learning dimensions including all except continuous learning. The results
for the performance dimensions showed managers higher than supervisors and employees on financial
performance, and managers higher than employees on knowledge performance. The results also
showed variations in the performance dimensions across organizations.
Research limitations/implications – The results indicated variations across levels and across
organizations that may hinder progress toward a learning organization and performance
improvements. Practical implications include the need for more communication and participation
across all levels of the organization, improved access to and sharing of information at lower levels, and
empowering employees to use information for decision making.
Originality/value – The paper addresses the paucity of research on the perceptions of disparate
groups relevant to the learning organization and organizational performance. It identifies an important
area of research by identifying a potential road-block for organizations attempting to adopt a learning
organization culture.
Keywords Learning organizations, Individual perception, Financial performance,
Knowledge management
Paper type Research paper

Introduction
Organizations are operating in a global, fiercely competitive, and turbulent
environment that requires the ability to adapt, change, and improve in order to
develop competitive advantage. Corporate executives constantly search for new and
innovative strategies to ensure organizational success or even survival. Many popular
strategies for success focus on people as an organization’s greatest asset (Pfeffer, 1994),
and on their knowledge as a strategy for competitive advantage (Kriegesmann et al.,
2005). Consequently, researchers and practitioners alike have stressed the need for The Learning Organization
Vol. 17 No. 5, 2010
organizations to improve performance by operating as learning organizations, pp. 455-470
fostering an environment where all members continuously learn and take action to q Emerald Group Publishing Limited
0969-6474
increase the knowledge of organizational members and to improve the organizations’ DOI 10.1108/09696471011059831
TLO performance (Garvin, 1993; Kline and Saunders, 1993; Kuchinke, 1995; Marquardt,
17,5 1995; Slater and Narver, 1995). The learning organization appears to be an important
competence for all organizations to develop in order to succeed (Kline and Saunders,
1993; Kuchinke, 1995). The learning organization has been described as a strategy for
improving organizational performance and maintaining a competitive advantage
(Weldy, 2009). In fact, some researchers cite the learning organization as the only
456 sustainable competitive advantage in response to an increasingly unpredictable and
turbulent business environment (Slater and Narver, 1995).
A key aspect of the learning organization is that all members of the organization
need to practice continuous learning to improve performance (Gephart et al., 1996;
Nadler and Nadler, 1994). Researchers tend to agree that individual learning is
necessary for organizational learning to occur, and that learning by members from all
levels is essential to ensure the success of the organization and avoid extinction (Iles,
1994; McManus, 1996; Robinson et al., 1997). Based on the emphasis placed on learning
for all members at all levels of the organization, efforts to become a learning
organization for competitive advantage should target managers, supervisors, and
employees. However, there is a paucity of research on learning organizations in which
the perceptions of these disparate groups are investigated and compared to determine
the organizations’ progress toward becoming a learning organization.
Previous learning organization research has focused on defining the construct
(Dixon, 1994; Pedler et al., 1991; Senge, 1990; Watkins and Marsick, 1996), and
identifying the dimensions with model development (Garvin, 1993; Goh, 1998; Pedler
et al., 1991; Senge, 1990; Watkins and Marsick, 1996). Studies have also attempted to
measure success rates at implementing or adopting the learning organization (Griego
et al., 2000; Lopez et al., 2005; Moilanen, 2005). However, few studies have focused on
collecting input from various levels of the organization to determine how each level
views whether learning is taking place and the resultant impact on performance.
Because of the importance placed on learning and sharing of information by all
members of the organization, it is necessary to measure success by examining
perceptions of members from all levels of the organization. This research first extends
the existing literature by exploring variations in the perceptions of organizational
members at different levels and across organizations to identify levels where additional
initiatives for transition to a learning organization are needed.
Despite agreement that transition to a learning organization is an important
competence for improving organizational performance (Kline and Saunders, 1993;
Kuchinke, 1995; Weldy, 2009), few studies have examined successful transition to a
learning organization and improvements in performance for the organization. This
study also extends previous research by comparing these same groups (organizational
level and organization) to perceptions of improved knowledge performance and
financial performance.

Literature review
Learning organization definition
The learning organization construct was introduced over 40 years ago (Cangelosi and
Dill, 1965), but received increased emphasis with the publication of The Fifth Discipline
by Peter Senge (1990). The learning organization has been given many definitions with
the mostly widely accepted definition and the one used in this paper given by Senge The learning
(1990, p. 3): organization
Organizations where people continually expand their capacity to create the results they truly
desire, where new and expansive patterns of thinking are nurtured, where collective
aspiration is set free, and where people are continually learning to learn together.
Others, such as Dixon (1994) defined a learning organization in terms of how a 457
company uses its members to create processes that will increase performance
improvements. Pedler et al. (1991) defined it as a firm that facilitates the learning of all
its members in order to continuously transform itself. One common thread of the
definitions is that all organizational members must be involved in continuous learning
and take action to make improvements.

Learning organization models

Many studies have attempted to identify the specific components or dimensions
associated with a learning organization and develop models of the construct. Some
focus on how organizations transition to a learning organization. For example, Senge
(1990) developed five essential disciplines that can facilitate the transition to a learning
organization including systems thinking, personal mastery, mental models, building
shared vision, and team learning. Pedler et al. (1991) identified 11 areas critical to the
transition to a learning organization:
(1) a learning approach to strategy;
(2) participative policymaking;
(3) informing;
(4) formative accounting and control;
(5) internal exchange;
(6) reward flexibility;
(7) enabling structures;
(8) boundary workers as environmental scanners;
(9) inter-company learning;
(10) learning climate; and
(11) self-development for everyone.

Transitioning to a learning organization requires concern for what systems are needed
and how to facilitate continuous learning.
Other researchers have focused on what successful learning organizations need to
do. Garvin (1993) emphasized that learning organizations must be skilled at five main
activities including systematic problem solving, experimentation with new
approaches, learning from successes and failures, learning from best practices, and
transferring knowledge quickly and efficiently throughout the organization. Goh
(1998) used interviews and focus groups to develop an archetype of a learning
organization that has five core building-blocks. These include clarity and support for
mission and vision, shared leadership and involvement, a culture that encourages
experimentation, the ability to transfer knowledge across organizational boundaries,
TLO and teamwork and cooperation. Successful learning organizations appear to emphasize
17,5 team learning, accountability, and responsibility.
Watkins and Marsick (1996) developed a model that integrates two main
organizational components: people and structure. This model and resultant survey
instrument, the Dimensions of the Learning Organization Questionnaire (DLOQ)[1],
examined seven dimensions of the learning organization at the individual, team, and
458 organizational levels. The learning organization dimensions: (continuous learning,
dialogue and inquiry, team learning, embedded systems, empowerment, system
connections, and leadership) are measured against two organizational performance
variables (financial and knowledge performance). These seven learning dimensions
capture the essence of the different construct definitions used to identify firms that
successfully transition to a learning organization. Although various components and
dimensions have been identified, limited empirical research has focused on measuring
the implementation of these learning organization dimensions in different
organizations, and even fewer studies have measured and compared perceptions of
members from different levels of the organization.

Empirical studies
Despite much research on the learning organization, Tsang (1997) noted that most
literature on it is prescriptive and lacks systematic and solid empirical research.
Although limited in number, some empirical studies have attempted to measure the
dimensions in organizations to determine success at transitioning to a learning
organization.
Griego et al. (2000) examined predictive practices that would enable an organization
to successfully achieve learning organization status. A similar study by Moilanen
(2005) collected data from 686 respondents across 25 organizations finding that
individuals placed more trust in their own learning than in organizational learning.
However, these studies failed to link the learning organization with performance.
Lopez et al. (2005) conducted a study to explore the relationship between
organizational learning and organizational performance, using innovation and
competitiveness as indicators of organizational performance. Survey data were
collected from 195 respondents, and then structural equation modeling was used to
explore the extent of the relationship between organizational learning and
organizational performance. The results supported the theory that organizational
learning contributes to organizational performance (innovation and competitiveness),
which, in turn, can impact economic or financial results. However, this study focused
exclusively on the perceptions of top executives relevant to four dimensions of
organizational learning, with two indicators of financial performance. The current
study extends the literature by comparing the perceptions of members from different
levels and organizations on the successful transition to a learning organization and
improvements in knowledge and financial performance.
Some previous studies attempted to identify variations in perceptions across
organizational levels. A study by Ryan (1991) surveyed 851 senior and middle managers
and found differences in perceptions relevant to the important components of job
performance; however, this study did not include employees’ perceptions. Other studies
have focused on variations in perceptions among managers and employees relevant to
their work lives (Cully, 1998), and relevant to fairness on the job (Mollica, 2004).
Although previous studies have identified variations in perceptions across levels in areas The learning
such as job performance, work lives, and fairness, one noted gap is that no previous organization
studies have focused on different perceptions across all organizational levels relevant to
the dimensions of a learning organization and organizational performance.
While previous studies measured transitioning to a learning organization, they
neither solicited input from different organizations nor compared the responses of
managers, supervisors, and employees on the dimensions of a learning organization. A 459
key component of the learning organization is that employees at all levels need to be
involved in continuous learning to include taking action on this learning for both the
successful transition to a learning organization and its maintenance. Thus, empirical
studies should include and distinguish among all employee levels, and measurement
efforts should include collecting data from members at these different levels. Because
of the emphasis placed on learning by all members for successful transition to a
learning organization, could variations in perceptions across levels hinder a successful
transition?
Although no previous studies have focused on different perceptions across
organizational levels relevant to the dimensions of a learning organization and
organizational performance, it is logical to assume that managers usually have a more
positive perception of their organization than members from lower levels. Because
members from higher organizational levels typically are more knowledgeable about
these strategic decisions, it is likely that the realization of a need to improve
organizational learning would lead to specific actions to implement the necessary
changes. These higher-level managers would then view this organizational change
from a different perspective than a lower-level employee. Based on these assumptions,
members from different organizational levels may disagree on their organizations’
success at transitioning to a learning organization. Specifically:
H1. Managers will have the highest perception of the organizations’ success at
becoming a learning organization and employees will have the lowest
perception of this success.
If the different levels, i.e. managers, supervisors, and employees, disagree on the
organizations’ success at becoming a learning organization, which specific dimensions
are the sources of this variation? Identifying these learning organization dimensions
that are lower for one level versus another could determine common and specific
organizational levels where firms need to concentrate efforts when transitioning to a
learning organization in order to improve the odds of a successful transition.
Making the transition to a learning organization requires continuous work and
improvements over-time. Efforts to make the successful transition to a learning
organization involve a process or serious of stages rather than an instant adoption of a
new approach. Because organizations can be at various stages in the process of
adopting a learning organization, it is likely that perceptions of members from different
organizations will vary regarding the successful transition to a learning organization.
Thus:
H2. Members from different organizations will vary in their view of how well their
organization has adopted the dimensions of a learning organization.
TLO Finally, although extensive research has been conducted on learning organizations, a
17,5 gap in the literature exists concerning studies that focused on collecting data from
different organizations and different levels relevant to organizational performance.
Firms that successfully transition to a learning organization should be in a better
position to benefit from this transition through improvements in financial and
knowledge performance. Also, managers should have different views than supervisors
460 and employees as to this successful transition to a learning organization, and probably
have different views relevant to financial and knowledge performance. At the very
least, there should be a strong association between members’ perceptions of this
transition and the members’ perceptions of the firm’s performance. Thus:
H3. Opinions will vary across levels and organizations relevant to the financial
performance of the organization.
H4. Opinions will vary across levels and organizations relevant to the knowledge
performance of the organization.

Methodology
Sample
The research design consisted of a self-report questionnaire to evaluate perceptions on
the dimensions of the learning organization. A total of 38 local organizations were
contacted to solicit participation in the study; however, 31 were eliminated due to small
size, lack of multiple organizational levels, or lack of initiatives to transition to a
learning organization. Of the remaining seven firms, four were willing to participate
including two service and two manufacturing firms. Data were collected from
managers, supervisors, and employees relevant to their perceptions of the dimensions
of the learning organization and organizational performance. A total of 950
questionnaires were distributed in the four organizations (based on the number of
members) and 176 instruments were completed and returned. However, 33 surveys
were discarded due to missing or incomplete data resulting in 143 usable surveys for
an overall response rate of 15 percent. The individual response rates for Company A, B,
C, and D were 15 percent, 13 percent, 29 percent, and 11 percent, respectively.

Instrument
The dimensions of the learning organization were examined using the DLOQ
developed by Watkins and Marsick (1997). The DLOQ measures respondents’
perceptions on seven learning organization dimensions and two performance
dimensions. The dimensions describe actions or practices by individuals, teams,
leaders, and the organization as a whole to create a learning organization. The DLOQ
contains 55 items and uses a six point rating scale with anchors from “almost always”
to “almost never”. The instrument measures dimensions of a learning organization on
seven scales and measures performance on two scales.
The instrument includes six items (seven for Continuous Learning) to measure each
learning and performance dimension:
(1) Continuous learning is achieved when an organization creates an opportunity
for continuous learning for all members. An example of this is, “in my
organization, people are given time to support learning”.
 (2) Dialogue and inquiry is an effort by the organization to encourage questioning, The learning
feedback, and experimentation. An example of this is, “in my organization, organization
people give honest and open feedback to each other”.
(3) Team learning is the idea of collaborating and using teamwork effectively. An
example of this is, “in my organization, teams/groups are rewarded for their
achievements as a team/group”.
(4) Embedded systems is the use of an integrated system to allow access to 461
information and sharing of information. An example of this is, “my organization
maintains an up-to-date data base of employee skills”.
(5) Empowerment is creating and sharing a collective vision, as well as soliciting
feedback on the status of the vision. An example of this is, “my organization
gives people choices in their work assignment”.
(6) System connections includes actions by the organization to connect to its
internal and external environment. An example of this is, “my organization
encourages people to get answers from across the organization when solving
problems”.
(7) Leadership is the extent to which the organization thinks strategically about
learning and creating change. An example of this is, “In my organization,
leaders mentor and coach those they lead”.

The seven learning dimensions are then compared with two performance scales:
(1) Financial performance is the state of financial health and resources available for
growth. An example of this is, “In my organization, return on investment is
greater than last year”.
(2) Knowledge performance refers to enhancement of products and services
because of learning and knowledge capacity. An example of this is, “In my
organization, the number of individuals learning new skills is greater than last
year”.

The DLOQ has been tested for validity and reliability and has progressed through
several stages of development with continual revisions by Watkins and Marsick (1997)
to improve the reliability and validity of the instrument. A study by Yang et al. (2004)
validated the instrument by refining the items through item analysis and expert
evaluation for coherence and readability. The developers conducted a field study with
71 managers and human resource developers, resulting in additional changes based on
item analysis and reliability testing. Analysis of internal consistency (Cronbach’s
Alpha) led to additional revisions for low item-total correlations to improve content
validity. A second sample of 836 subjects was collected to examine construct reliability
and validity of the seven dimensions used to measure the learning organization.
Confirmatory factor analysis and structural equation modeling (SEM) indicated that
the model accounted for more than 90 percent of the joint variance and covariance.
In our sample, Cronbach’s alpha for the seven dimensions and two criterion
variables were all above 0.87 and are shown in Table I. Also shown in Table I are the
means, standard deviations, and correlations for the seven learning organization
dimensions and the two performance dimensions. The means ranged from 3.09 for the
empowerment scale to 3.74 on the knowledge performance scale. The correlations for
TLO
Scales M SD 1 2 3 4 5 6 7 8 9
17,5
1. Continuous learning 3.73 1.09 0.87
2. Dialogue and inquiry 3.38 1.14 0.80 * 0.88
3. Team learning 3.48 1.21 0.83 * 0.89 * 0.93
4. Embedded systems 3.40 1.28 0.75 * 0.78 * 0.82 * 0.90
462 5. Empowerment 3.09 1.19 0.78 * 0.77 * 0.81 * 0.83 * 0.89
6. System connections 3.33 1.30 0.74 * 0.73 * 0.75 * 0.85 * 0.87 * 0.91
7. Leadership 3.55 1.30 0.79 * 0.80 * 0.80 * 0.86 * 0.86 * 0.87 * 0.94
Table I. 8. Financial performance 3.64 1.12 0.55 * 0.57 * 0.50 * 0.55 * 0.54 * 0.52 * 0.61 * 0.88
Means, standard 9. Knowledge perform. 3.74 1.22 0.66 * 0.65 * 0.63 * 0.63 * 0.66 * 0.62 * 0.73 * 0.83 * 0.90
deviations, correlations,
and Cronbach’s alpha for Note: * Correlation is significant at the 0.01 level (two-tailed). Cronbach’s Alpha is shown for each
scales on the DLOQ scale along the diagonal in italics

the DLOQ scales were positive and statistically significant ranging from 0.50 to 0.89
for the nine scales. The high correlations caused some concern for multicollinearity,
limiting the use of regression to analyze the data.
To help validate the scale for our sample, a confirmatory factor analysis was
performed using SEM (Lisrel 8.80) for the nine variables using the 55 items. Because
constructs measured by the survey may still be partially susceptible to common
method variance, we conducted a Harman one-factor analysis to test for this effect. To
help confirm the best model, indicator loadings, factor correlations, composite latent
variable reliability for each latent variable, and three fit indices (the standardized
root-mean-square residual (RMSR), the goodness of fit index (GFI), and the normed-fit
index (NFI)) were examined and compared (Bollen and Long, 1993; Shook et al., 2004).
Two sets of models were compared:
(1) a null model (i.e. no factors underlie the data) versus a single method model; and
(2) a measurement model versus an uncorrelated measurement plus method factor
model.

Inspection of Table II reveals that both the method model (Model 2) and the trait model
(Model 3) fit the data better than the null model. Both Model 2 (method model) and
Model 3 (hypothesized or trait model) fit the data significantly better than Model 1.
Comparison of Model 3 (trait model) with Model 4 (trait þ method) reveals that while
Model 4 is significantly different at the p , 0.01 level (x 2diff(64) ¼ 634.68, p , 0.01),
both models provide an adequate fit to the data with acceptable fit statistics. Thus,
while there is some method variance, we do not know whether it inflates or dampens

Model Chi-square df GFI RMSR NFI

1. Null 54,498.97 1,485

2. Single Method Factor 5,109.03 * 1,430 0.43 0.17 0.92
3. Measurement (Hypothesized) Model 3,204.96 * 1,394 0.55 0.14 0.94
Table II. 4. Measurement Model þ Method Factor 2,570.28 * 1,330 0.60 0.12 0.95
Confirmatory factor
analysis and Harman Notes: * Significant at p , 0.001; GFI ¼ Goodness of fit; RMSR ¼ Root mean square residual;
one-factor results NFI ¼ Normed fit index
any results, and we do not know its extent (Spector, 2006). Overall, these results The learning
indicate that because of our concern for common method bias any findings should be organization
viewed as more exploratory in nature.

Data analysis
The responses to the DLOQ instrument were tabulated for all four organizations and
for each organizational level to determine the extent to which the respondents 463
perceived that the organization possessed the seven learning organization dimensions
and the two performance dimensions. Higher scores indicated positive perceptions
relevant to the successful adoption of the dimensions of a learning organization and
achievements in knowledge and financial performance. Means and standard deviations
were calculated for the DLOQ scales for both organizational level and organization
(Table III). For H1, responses were compared based upon the level of employee for each
item. For H2, responses were compared based upon the organization. These analyses
were also used for H3 and H4 by comparing the average response for level and
organization on the knowledge and financial performance dimensions.
Thus, the scores were evaluated for differences using a 3 X 4 Analysis of Variance
(ANOVA) for individuals from the three different organizational levels and from each
of the four organizations. Significant main effects were followed up with ANOVAs to
identify the specific scales where the variances occurred. Pairwise comparisons were
then analyzed to identify how the responses on the scales varied for employees,
supervisors, and managers and for each of the four organizations.

Results
The respondents for the study included 71 percent males with 17 percent managers, 12
percent supervisors, and 71 percent employees. A majority had completed high school
(41 percent), an associate degree (31 percent), or an undergraduate degree (18 percent).
Overall, 52 percent of the respondents spent 1 to 10 hours and 13 percent spent 11 to 20
hours on work related learning each month. A majority of respondents (65 percent) had
been with the current company between 1 and 10 years. The number of years of
previous work experience varied for the sample: 27 percent had 1 to 10 years, 29
percent had 11 to 20 years, 20 percent had 21 to 30 years, and 24 percent of the
respondents had over 30 years of work experience.
Table III shows the means and standard deviations for the DLOQ scales for both
organizational level and the four organizations. The means for organizational level
ranged from 3.02 for employees on the empowerment scale to 4.03 for managers on the
knowledge performance scale. Table III also contains the means and standard
deviations on the DLOQ scales for each company and shows where each organization
stands on the seven dimensions of the learning organization and the two performance
dimensions. The means ranged from 2.20 for Company A on the empowerment scale to
4.25 for Company B on the continuous learning scale.
A 3 £ 4 (Organization Levels £ Organizations) ANOVA was conducted to determine
if there were differences in the responses from managers, supervisors, and employees
across the four organizations. The ANOVA on the DLOQ scales by organizational level
and by organization was conducted with an alpha level of 0.05. Significant main effects
were found for organizational level, F (14, 250) ¼ 3.85, p ¼ 0.000, h 2 ¼ 0.18, and across
organizations, F (21, 359) ¼ 3.42, p ¼ 0.000, h 2 ¼ 0.16 providing some support for H1
 17,5

464
TLO

Table III.

level and company

Means and standard
deviations for DLOQ
scales by organization
Level Company
Employees Supervisors Managers A B C D
M D M D M D M D M D M D M D

Continuous learning 3.69 1.16 3.83 1.05 3.86 0.75 2.81 1.14 4.25 0.98 3.30 0.96 3.80 0.79
Dialogue and inquiry 3.32 1.16 3.45 1.32 3.54 0.94 2.39 1.13 3.81 1.13 3.18 0.96 3.33 0.95
Team learning 3.42 1.28 3.47 1.25 3.69 0.90 2.34 1.04 3.96 1.22 3.26 1.10 3.46 0.89
Embedded systems 3.47 1.32 3.37 1.41 3.13 1.00 2.23 .90 4.08 1.17 3.21 1.20 2.91 0.97
Empowerment 3.02 1.23 3.06 1.38 3.40 0.81 2.20 1.02 3.72 1.01 2.71 1.09 2.81 1.11
System connections 3.28 1.33 3.54 1.50 3.42 1.03 2.53 1.35 4.01 1.11 2.87 1.30 3.02 0.95
Leadership 3.51 1.37 3.62 1.41 3.68 0.88 2.50 1.15 4.21 1.16 3.31 1.22 3.12 1.04
Financial performance 3.64 1.13 3.44 1.32 3.80 0.95 2.49 1.47 4.08 1.01 3.54 0.65 3.59 1.08
Knowledge performance 3.67 1.24 3.74 1.51 4.03 0.82 2.73 1.37 4.14 1.09 3.60 1.01 3.70 1.28
Note: Mean scores based on five-point scale
and H2. The results also indicated significant interaction effects for organizational level The learning
with organization, F (42, 589) ¼ 1.80, p ¼ 0.002, h 2 ¼ 0.09. organization
The simple main effects were examined for level and organization to determine
where the multivariate differences occurred. Follow-up tests and pairwise comparisons
were conducted using the Bonferroni procedure to control for Type I error. As shown in
Table IV, the ANOVA results indicated significant effects based on organizational
level for two of the seven scales including empowerment F (2, 131) ¼ 3.82, p ¼ 0.024, 465
h 2¼ 0.06, and system connections F (2, 131) ¼ 3.85, p ¼ 0.024, h 2 ¼ 0.06. Pairwise
comparisons indicated significant differences across levels with managers higher than
employees on empowerment and supervisors higher than employees on system
connections. The results suggest some differences in perceptions among managers,
supervisors, and employees relevant to the dimensions of a learning organization
providing partial support for H1 indicating some variations in responses across levels
for two of the learning organization dimensions.
The ANOVA results for each organization indicated a significant effect for six of the
seven dimensions (all except continuous learning) offering support for H2 (see Table IV).
Pairwise comparisons were conducted across organizations using the Bonferroni
procedure to control for Type I error. The results of pairwise comparison by organization
indicated that Company B was significantly higher than Company A on five scales

Degrees of Eta squared

freedom F-statistic p (h 2)

H1 ANOVA-level
Continuous learning 2, 131 2.82 0.063 0.04
Dialogue and inquiry 2, 131 2.01 0.137 0.03
Team learning 2, 131 2.27 0.107 0.03
Embedded systems 2, 131 0.17 0.843 0.00
Supported Empowerment 2, 131 3.82 0.024 0.06
Supported System connections 2, 131 3.85 0.024 0.06
Leadership 2, 131 2.94 0.057 0.04
H2 ANOVA-organization
Continuous learning 3, 131 2.29 0.081 0.05
Supported Dialogue and inquiry 3, 131 3.95 0.010 0.08
Supported Team learning 3, 131 4.68 0.004 0.10
Supported Embedded systems 3, 131 6.34 0.000 0.13
Supported Empowerment 3, 131 5.51 0.001 0.11
Supported System connections 3, 131 3.71 0.013 0.08
Supported Leadership 3, 131 5.08 0.002 0.10
H3 ANOVA-financial performance
Supported Financial performance £ level 2, 131 4.52 0.013 0.07
Supported Financial performance £ 3, 131 8.82 0.000 0.17
organization
H4 ANOVA-knowledge performance
Supported Knowledge performance £ level 2, 131 3.95 0.022 0.06 Table IV.
Supported Knowledge performance £ 3, 131 2.91 0.037 0.06 Results of ANOVA for
organization level, organization, and
financial and knowledge
Notes: * Mean difference is significant at the 0.05 level. Bonferroni adjustment for multiple comparisons performance
TLO including dialogue and inquiry, team learning, embedded systems, empowerment, and
17,5 leadership. Results also showed significant differences with Company B higher than
Company D on four scales (embedded systems, empowerment, systems connect, and
leadership). The results suggest variations in perceptions of members from different
organizations concerning the dimensions of a learning organization in support of H2 that
perceptions will vary across organizations. Follow-up tests indicated no significant
466 interaction effects for organizational level and organizations.
The ANOVA results for financial performance and knowledge performance indicated
significant main effects for organizational level, F (4, 260) ¼ 4.69, p ¼ 0.001, h 2 ¼ 0.07,
and across organizations, F (6, 260) ¼ 4.89, p ¼ 0.000, h 2 ¼ 0.10. The results of follow-up
tests shown in Table IV indicated significant effects for financial performance based on
organizational level F (2, 131) ¼ 4.52, p ¼ 0.013, h 2 ¼ 0.07, and based on organization F
(3, 131) ¼ 8.82, p ¼ 0.000, h 2 ¼ 0.17. The results of pairwise comparisons showed
managers were significantly higher than supervisors, and Company B, Company C, and
Company D were higher than Company A on financial performance. The results indicated
some differences in perceptions across organizational level and organizations on
improvements in financial performance providing some support for H3.
The ANOVA results also indicated significant effects for knowledge performance
by organizational level F (2, 131) ¼ 3.95, p ¼ 0.022, h 2 ¼ 0.06, and by organization
F (3, 131) ¼ 2.91, p ¼ 0.037, h 2 ¼ 0.06. The results of pairwise comparisons
indicated significant differences with managers higher than employees, and
Company B higher than Company A for knowledge performance. The results
suggest differences in perceptions among managers, supervisors, and employees in
different organizations relevant to improvements in knowledge performance
providing partial support for H4.

Discussion
The results indicated variations in the perceptions of organizational members from
different levels relevant to the adoption of both the dimensions of a learning
organization and the resulting performance of the company. The results suggest that,
for several dimensions, managers have the highest perception of the organization
followed by supervisors and employees. Because employees scored the organization
significantly lower than supervisors on system connections, this possibly means that
employees were less likely to assume that technology systems were in place to allow
access to information and sharing of learning. This could be important because
transition to a learning organization requires that members from all levels have
access to information and share learning with other members throughout the
organization.
Managers also scored the organization higher than employees on empowerment.
This suggests that managers are more likely to incorrectly assume that employees are
being empowered with the setting and implementation of a joint vision, and are being
motivated with responsibility and decision-making. However, employees are not
reporting that same level of empowerment. This is a concern due to the importance
placed on teamwork and empowerment in the management literature and in learning
organization models (Bluestone and Bluestone, 1992; Umiker, 1997; Uzzi, 1993;
Yarborough, 1994). Managers may need to improve initiatives relevant to empowering
employees to make decisions.
 Another significant finding concerned perceptions relevant to the performance of The learning
the organization with managers higher than employees on knowledge performance organization
and managers higher than supervisors on financial performance. This suggests that
lower levels of the organization are somehow less informed or aware of improvements
in knowledge and financial performance. One possible explanation for lower levels
being less informed about performance improvements could be limited access to that
information due to a lack of system connections as described above. The results 467
suggest the need for improvements at communicating to lower levels, accessing and
sharing of information, and informing employees about performance improvements.
The results also indicated variations in the perceptions of organizational members
from different organizations on the adoption of the dimensions of a learning
organization. These results indicate that transitioning to a learning organization is a
process that takes some time and will not result in equivalent outcomes.
An important area of interest for this study concerns the relationship between the
learning organization and improvements in knowledge and financial performance. The
results indicated variations across organizations relevant to the adoption of the
dimensions of a learning organization and improvements in knowledge and financial
performance. The results suggest that transition to a learning organization may be
associated with improvements in financial performance, but have less of an impact on
knowledge performance. Again, this may be attributed to earlier results concerning the
lack of system connections and empowerment or it may be that employees at all levels
are hearing about the company performing better (i.e. financial performance) but may
not actually be experiencing this increased level of performance in how knowledge is
shared. Further, lower-level employees (the predominant respondent) may have limited
access to information and with the limited authority to make decisions (noted above in
the empowerment dimension) would be expected to have lower perceptions of
knowledge performance for the organization.
It is becoming commonly accepted that transitioning to a learning organization is an
important part of a firm’s strategy to gain and maintain competitive advantage in a
turbulent environment (Slater and Narver, 1995; Weldy, 2009). It is also evident from
previous studies that adopting a learning organization culture requires continuous
learning and participation by members from all organizational levels. Any variations
in perceptions may indicate a lack of communication, involvement, or participation,
which could hinder progress toward becoming a learning organization. This would
suggest the need for improved communication between managers and those below
them to increase knowledge and participation across organizational levels on being a
learning organization to minimize any differences in perceptions between levels. It may
be necessary to focus more attention on the involvement of lower levels by facilitating
access to and sharing information, providing information on performance
improvements, and empowering employees to use learning for decision making.

Recommendations for future study

The results of this exploratory study provide some evidence of how perceptions vary
across organizational levels and across organizations concerning the learning
organization and organizational performance. However, the results should be viewed
taking into consideration the study’s limitations. These include the limited sample size
of only four organizations and a response rate of only 15 percent, effect of common
TLO method variance, use of perceptions instead of objective financial data, the
17,5 cross-sectional nature of the survey, and that fact that the same respondents were
responsible for both predictor and criterion variables. To address these limitations and
to further this study’s discoveries, future research should focus in several important
areas. First, researchers should collect data from a larger number of organizations to
increase the sample size and continue to solicit input from all levels of the organization
468 including managers, supervisors, and employees. This would increase the accuracy of
the results and address concerns about the effect of common method variance. It would
also be useful to collect data from external stakeholders such as customers and
suppliers on the elements important for a learning organization. Second, future studies
should focus on the development of more objective measures of the learning
organization. This would provide data other than the perceptions of organizational
members that can be biased by a variety of factors such as personal attitude, job
satisfaction, tenure with the organization, and/or confidentiality concerns. Third,
longitudinal studies would be better at measuring performance improvements and
return on investment for organizations that transition to a learning organization. This
would help isolate the actual improvements to financial and knowledge performance.
The results of such studies would help to further justify the emphasis placed on the
learning organization as a key strategy for improving organizational performance in a
turbulent environment.

Recommendations for practice

The results of this study provide useful information that could be used to make
improvements in organizational practices. One recommendation is that organizations
striving to make the transition to a learning organization should focus on reaching
members from all organizational levels. It is necessary to improve communication and
participation by facilitating adoption of learning organization dimensions at all
organizational levels. The process should include two-way communication with all
departments and levels to ensure buy-in and commitment to the improvements being
implemented. The results also provide some guidance on where the variations in
perceptions across levels occur and therefore where organizations need to focus efforts.
A second recommendation is that efforts should focus on making improvements at
lower levels relevant to accessing and sharing of information, and improve
communication about improvements in performance. A third recommendation is for
managers to empower employees more or allow members to participate in setting and
implementing decisions. It is necessary to ensure that organizational members at lower
levels are provided access to information and are allowed to make decisions based on
that information. This would enable all members of the organization to take action on
learning to improve performance and gain a competitive advantage.

Conclusions
This study provides a first step in the necessary link between transitioning to a
learning organization and performance that includes all organizational levels. As
organizations continue to strive to become learning organizations as a strategy for
competitive advantage, it is necessary to determine if there are variations across
organizational levels, and to identify the source of the variation.
Note The learning
1. Instrument used with permission of the authors. organization
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Corresponding author
Teresa G. Weldy can be contacted at: tweldy@usouthal.edu

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