Two processes of information and knowledge flow in organizational learning

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As for the information and knowledge flow in organizational learning, there are two processes: one flow from the higher level to the lower level, and the other from the lower level to a higher level. These are closely related to the concept of exploration and exploitation of knowledge by March (1991). The bi-directional flow reflects two different types of learning: Exploitative Learning and Explorative Learning (Crossan et al., 1999).

Exploitation

Exploitation features the flow of information or knowledge from organizational level to the group level and the individual level. It is the exploitation of information or knowledge, which transforms organizational knowledge into individual knowledge and gradually changes individuals’ cognition and behaviors.

Actually, exploitation in nature is to put what an organization has acquired into practice (Holmqvist, 2003). The whole process is realized by primary organizational learning. Argyris and Schon (1978) believe that an organization detects and corrects errors through single-loop learning. Senge (1990) thinks that an organization accommodates itself to new simations through adaptive learning. Exploiting Learning emphasizes individuals' or groups' acceptance of knowledge that an organization has acquired so as to improve their behaviors. This is a lower-level learning (Fiol & Lyles, 1985), which is, however, necessary for any organization.

Meanwhile, to exploit the experience may bring singular perspective to an organization, depriving the possibility of exploiting new learning opportunities. What is effective in the short term may seem ineffective in the long term. In order to remedy the weakness, it is necessary for an organization to create diversity of experiences through innovation, experimentation and venturing. Such process of exploring new knowledge (March, 1991; Levinthal & March, 1993) is called Exploring Learning.

Exploration

Exploration, featuring the exploration of information or knowledge, is a flow of information or knowledge from the individual level to the organizational level, which integrates an individual's new knowledge and behavior and transforms them to organizational knowledge so as to gradually change organizational-level features such as organizational culture, strategy and procedure. The process is achieved through high-level organizational learning (Fiol & Lyles, 1985). Argyris and Schon (1978) think that an organization makes changes and adjustments in its basic action hypothesis through double-loop learning. Senge (1990) thinks an organization generates new knowledge and ideas through generative learning. Exploration emphasizes the process that an organization can sensitively capture the new knowledge and information so as to change the former action hypothesis and thinking mode. Such learning is what many organizations lack.

In fact, from the perspective of the flow of knowledge or information, inter- organizational learning also demonstrates both exploitation and exploration of knowledge. Inkpen (2000) puts forward a model of inter-organizational knowledge acquisition and describes how the inter-organizational knowledge is exploited. Lindholm (1997) summarizes three different learning procedures among international joint ventures: the transference of knowledge, the generation of knowledge, and the application of knowledge. It involves both exploitation and exploration of knowledge or information (Holmqvist, 2003).

In the previous studies concerning organizational learning, it is often emphasized that "maintaining an appropriate balance between exploration and exploitation is a primary factor in system survival and prosperity” (March, 1991); and that “strategic renewal requires that organizations explore and learn new ways while concurrently exploiting what they have already learned” (Crossan et ah, 1999). They are interdependent on each other and co-exist, not the way of either-or alternative as many literatures claim (Holmqvist, 2003). It is the flow of knowledge or information that reflects that organizational learning is dynamic as a process of continuous cycling rise.

 
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