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MG1009

THEGENESISANDEVOLUTIONOFDYNAMICORGANIZATIONALLEARNINGCAPABILITIESWITHINTHESTRATEGICPRODUCTMANAGEMENTPROCESS

Researcherssuggestthatanewtypeofglobalenterprisewillthriveinthenewmillennium.Organizationswillbuildnewcompetitiveadvantagesbydiscovering,accessing,mobilizing,andleveragingknowledge.However,thesenewidealsandmodelsappeartolackpracticalmethodologiesthattransformknowledge-basedconceptsintodynamiccapabilitiesthatcanbeleveragedtocreateandsustainwealth.Thereisalackofacademicresearchonhoworganizationscaneffectivelyoperationalizeorganizationallearning(OL)conceptsinstrategicplanning,avitalprocessforcreatingcompetitiveadvantage.Inthisstudy,OLdynamiccapability,itsresultantlearningmechanism,organizationallearning,andfirmperformancewerestudiedbyapplyingamixed-modelapproachtoanexperimentalandcontrolgroupofjuniorandseniorcollegestudents.Thestudywasconductedinanindustrialbusinessenvironmentsimulatedviaacomputer-generateddecision-makingexercise.TheexperimentalmodelusedtheGlobalBusinessGameWorldEdition,alarge-scalebusinesssimulationthatrequiresstrategicplanningandefficientimplementationsonthepartofmanagementteams.Bothperceptualandfinancialdatawereusedtotriangulatetheeffectsamongorganizationallearning,firmperformance,andstrategicmanagementskill.Despiteinconsistenciesinimplementation,thisstudysuggeststhatoperationalizedOLmechanismsyieldimprovementsinorganizationallearningandfirmperformanceandthatafundamentalorderandstructureprocesswillyieldan

operationalframeworkforadynamicandfluidsystemsuchasorganizationallearning.Further,theresultssuggestthatacceleratedlearningrateswerepositivelyinfluencedbyincreasedactivityinsystemsthinking,actionlearning,spatialinterrelationships,andknowledgetransferiterations.Finally,resultssuggestthatembeddingandenhancingtraditionalstrategicplanningmethodswithspecificOLattributesrelatedpositivelytoincreasesinlearningandfirmperformance.Thestudywilladdtothemanagementbodyofknowledgebyillustratingthecapabilitiesfirmsuseinlearningtolearn,identifiedasaneedforfutureresearch.Theoperationalizationoflearningcapabilitiescanhelpmanagersunderstandhoworganizationallearningcanbeintegratedintostrategydevelopment,execution,andevaluation.

TABLEOFCONTENTS

Acknowledgementsii

ListofTablesvii

ListofFiguresviii

CHAPTERONEINTRODUCTIONANDSTATEMENTOFTHEPROBLEM1

StatementoftheProblem3

BackgroundoftheProblem3

PurposeoftheStudy5

TheorecticalSupportfortheStudy7

Assumptions^...^^..^Ir.9

ScopeandDelimitations.^.^^^JL10

Limitations11

NatureoftheStudy^.....^^...^W..12

DefinitionofTerms14

HypothesisandReseahQuestions16

SignificanceoftheStudy22

SummaryandOverview23

CHAPTERTWOLITERATUREREVIEW25

Introduction25

EarlyHistoryofOrganizationalLearning27

ShiftfromTangibletoIntangibleAssetsinCompetitiveAdvantage29

TransitionandEvolutionofOrganizationalLearning31

AlternativesandObjectionstoConventionalOLTheory37

TheoreticalBasisofModel39

OLDynamicCapabilityProcessOverview42

CodifyingContemporaryOLTheory48

Hypothesizedrelationships52

ProductPortfolioAnalysis:

TheValueT52

ResearchMethodology57

CHAPTERTHREEMETHODOLOGY60

Introductioni^r....'k..../^*60

DescriptionofResearchDesign61

InternalandExternalValidity68

Reliability.^fT...^..^T71

Targetpopulation.^^^..^^.^fT73

Treatment^^^%^^A^Tn74

Instrumentation76

DatacollectionProcedures79

DataAnalysisProcedures79

PilotStudyFindings82

RoleofResearcher85

ProtectionofHumanParticipants86

Summary87

CHAPTERFOURRESULTS89

Introduction89

InconsistenciesinResearchMethodology90

EmphasisonQualitativeAnalysis93

ScreeningofDataandValidation94

QualitativeFindings96

TriangulationandConvergenceofFindings109

Summary111

CHAPTERFIVECONCLUSIONSANDRECOMMENDATIONS112

SummaryofStudy^T....^>....„^&113

ResearchQuestions114

EmergingandAlternativeExplanations119

ImplicationsforManagment120

ImplicationsforFutureTheoryDevelopment122

ImplicationsforFutureEmpiricalResearch124

Summary125

REFERENCES127

APPENDICES

AppendixASurveyInstruments137

AppendixBOLAssessmentMatrix141

AppendixCStrategicPlanningTreatmentforControlandExperimentalGroups142

AppendixDBusinessSimulationComparisonMatrix152

AppendixEOLDynamicCapabilityProcessandDevelopmentofValueT153

AppendixFHowtoUseValueTDetail158

AppendixGLettertoParticpant171

AppendixHInformedConsentFormi^r....'k..../^*172

AppendixILetterofApprovaltoConductResearch174

AppendixJTeamActivityReport175

LISTOFTABLES

Table1:

StrategicPlanningDeficiencies51

Table2:

DemographicComparisonBetweenGroups96

Table3:

QualitativeFindingsRubric101

Table4:

EndofSimulationOLAttitudinalResults105

Table5:

EndofSimulationFirmPerformance107

Table6:

AttitudinalStrategicScores108

 

A^W^^.f

LISTOFFIGURES

Figure1:

ProposedTheoreticalModel5

Figure2:

OLDynamicCapabilityProcess17

Figure3:

IntegrationofKeyTheoreticalConcepts44

Figure4:

InterrelationshipDiagram47

Figure5:

TheValueTDiagram54

Figure6:

BehavioralTheoryRepresentation55

Figure7:

SingleandDoubleLoopDemonstratedm^^dvw55

Figure8:

VisualTheoryRelationship56

Figure9:

UnificationTheory56

Figure10:

StudyGroupSegmentation65

Figure11:

EqulibrationPeriod66

Figure12:

KeyStudyMilestonesandLogistics78

Figure13:

ResearchDesignandTimeline88

Figure14:

ActualResearchMethodology90

Figure15:

GraphofUnificationResponsesBetweenGroups97

Figure16:

GraphofKnowledgeTransferBetweenGroups98

Figure17:

GraphofSingleandDoubleLoopLearningBetweenGroups99

Figure18:

GraphofCognitiveLearningResponsesBetweenGroups99

Figure19:

GraphofBehavioralLearningResponsesBetweenGroups100

Figure20:

PerformanceIndexbyGroups106

Figure21:

StrategicSkillsMeanRankingsbyConstruct108

CHAPTERONEINTRODUCTIONANDSTATEMENTOFTHEPROBLEM

Accordingtoresearch,anewtypeofglobalenterprisewillthriveinthenewmillennium.Thesecorporationswillbuildnewcompetitiveadvantagesbydiscovering,accessing,mobilizing,andleveragingknowledge.Thisnewcorporationwillachieveandsustaincompetitiveadvantagebydevelopingvaluechainswithdistinctcorecompetencies;innovatingthroughtechnologicaladvances;quicklytappingemergingmarketsegmentsaroundtheworld;leveragingknowledgescatteredthroughoutitssubsidiaries;andmobilizingthisfragmentedknowledgetogenerateinnovationsthatproduce,market,anddelivervalueonaglobalscale(Ricart,Enright,Hart,&Kanna,2004).Bythecloseofthe20thcentury,compelitiTeadvantageshiftedfromprimarilytangibleresourcestoknowledge-basedstrategiesthatdeployorganizationalintangibleresourcessuchasorganizationallearning,innovation,andcustomerrelationshipsthat,inturn,fuelfirmperformance(Rutterford,Upton,&Kodwani,2006).Thisshiftincompetitiveadvantageisbeingdrivenbycontinualtechnoloacala*vancementsandthedemandsofaglobaleconomy.

Researchemergedinthelatterpartofthelastcenturythatofferspotentialbreakthroughideasformovingorganizationstonewlevelsofperformanceintheknowledgeage(Argyris,1977;Nonaka,1995;Senge,2004;Zollo&Winter2002).However,thesenewmodelslackpracticalmethodologiesandcapabilitiesthattransformtheseknowledge-basedconceptsintodynamiccapabilities.Thesedynamiccapabilitiesarelearnedandstablepatternsofcollectiveactivitythroughwhichtheorganizationsystematicallygeneratesandmodifiesitsoperatingroutinesinpursuitofimprovedeffectiveness(Zollo&Winter,2002).Thisexploratorystudy

examinedthisknowledgegapandpresentsanorganizationallearning-baseddynamiccapabilitythatsystematicallycreatesorevolvesoperatingroutinesthatincorporatecriticalOLattributes.Theseroutinesenhanceunderstandingofthecasuallinkagesorinterrelationshipsbetweentheactionsorganizationstakeandtheperformanceoutcomestheyobtain.

ThisresearcherintroducedanOL-baseddynamiccapabilityfoundedonrecentadvancementsinknowledgetransformationandchaostheoryandappliedittocontemporarystrategicplanningmethodologiestoimproveorganizationallearningandvaluecreation.Researchinorganizationallearninganditsapplicationtostrategicplanningrevealsconceptualmodelswithlimitedapplicationandempiricalworkthatrarelyincorporatespecificoperationalframeworkstobeusedbymanagement(Hansen,2004).TheproposedOLdynamiccapabilitystrivestoaddressthisspecificgapbytransformingconceptsormodifyingexistingmethodsintoanoperationalframeworkorlearningmechanismfororganizations.

Generalcriticismexistsamongresearchersthatstrategicplanningprocessesandtheirassociatedtools(Strengths,Weaknesses,Opportunities,Threats(SWOT),BostonConsultingGroup(BCG),balancedscorecard,etc.)donotfullyreflectorembodyrecentadvancesinorganizationallearningtheory.Thestrategicplanningprocessisavitallinktofirms'acquisition,evaluation,anduseofknowledge(Barney,1991;Choo,1998).Thestrategicplanningprocess,animportantaspectofknowledgemanagement,shouldcontinuallyreflectadvancementsinorganizationallearning.ItishypothesizedthattheresultantOLlearningmechanismproducedfromtheOL-baseddynamiccapabilitywillhaveapositiverelationshiptofirmperformanceandorganizationallearning.This"Value

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