Organizational learning in a global market

Article type: Research Article

Authors: Úbeda García, Mercedes^{; *} | Llopis Vañó, Francisco

Affiliations: Departamento de Organización de Empresas, Universidad de Alicante, Ap. de Correos 99, E-03080 Alicante, Spain

Correspondence: [*] Corresponding author. Tel.:/Fax: +96 5903606; E-mail: [email protected].

Abstract: We could characterize today's business world with numerous attributes, namely: dynamism, turbulence, complexity, etc. But if we had to give a brief definition of the specific challenges business management will have to face in the next century, the best choice would surely be talking about ‘global market’ and ‘knowledge management’. These are the two concepts we have tried to combine in this paper, trying to emphasize the starring role human resources management must play in this scenario. The globalization of economy is already a reality firms currently have to face, but what is the role of knowledge, or of those who own that knowledge (human resources) within a global framework? If we analyze the human capital in an firm according to the resource-based view of the firm, we can consider knowledge as an intangible resource on which organizations can build up their competitive advantages and keep them with the pass of time; and knowledge management can be seen as a strategic capability as long as the practices being used encourage the development and accumulation of a knowledge stock that will allow the firm to design an operating procedure which no other competitors can imitate. It will have to be the human resources management's task to generate a leverage among individual competences through the construction of an Organizational Learning Scheme. Organizational Learning can be understood as a collective phenomenon in which new knowledge is acquired by the members of an organization with the aim of settling, as well as developing, the core competences in the firm, taking individual learning as the basic starting point. There are various ways an firm can follow when it comes to learning, two of which stand out from the others: through accumulated experience or through experimentation, both of which are compatible with the concept of globalization, or with the decision made by an firm to start working overseas, that is, to become internationalized. An firm can choose to operate in a global market in order to achieve a higher income through the exploitation of its know-how, its brand name, or the management capabilities of the domestic firm in different countries. Thus, if we consider human knowledge as a key strategic factor on which competitive advantages can be built, we could justify the value of human resources in firms which start operating on an international scale through the competences that these human resources can develop, among which we can highlight the role played by the competences of the human capital from the parent company. In this case, the organization would be resorting to learning through accumulated experience. But we cannot forget that if the firm exploits exclusively its core competences, without trying to accumulate new distinctive competences, it will suffer, in the long run, a competitive disadvantage, insofar as it will have to face the competition of firms highly motivated by the learning that their resource basis will have developed, which will alter the competition terms. In this sense, we could consider the firm's internationalization as being, apart from a procedure to strengthen and exploit the firm's strategic competences, as a way of revitalizing or renewing them, reconfigurating the ‘domestic knowledge’ by means of other knowledge, through addition and combination, a new knowledge arising this way. On the other hand, it is in turn not an easy task to exploit and to achieve a return on domestic knowledge (which normally has an implicit nature) in other countries, and it is even more difficult to follow a conversion cycle so that new knowledge can be incorporated. Thus, we can highlight, as possible ways of transferring basic knowledge, imitation through the practical exercise of the head firm's operating procedures (using an ethnocentric approach), carrying out an exchange of experiences and, above all, two of the most commonly used actions in firms having to face internationalization processes, namely, the transfer of employees and the use of expatriates. The way in which that knowledge is later complemented and combined with that of the other entities, will depend on the learning rate reached in each specific unit, although we must point out that one of the critical factors when it comes to the achievement of an Organizational Learning Scheme is the consolidation of a cultural framework which encourages permanent improvement and which is specially characterized by the open attitude towards experimentation, the stimulus to take chances and the will to face failures or mistakes and to try and learn from them. In short, the study of Organizational Learning in a global market is one of the fields to be developed in human resources management, for two main reasons; on the one hand, the globalization of economy is a phenomenon which has an influence on the firms' success and, on the other hand, because competitive advantage currently lies in knowledge, and this can only have one replacement, more knowledge.

Keywords: Global market, human capital, Organizational Learning

DOI: 10.3233/HSM-2002-21303

Journal: Human Systems Management, vol. 21, no. 3, pp. 169-181, 2002