International Journal of Management (IJM)

Volume 7, Issue 7, November–December 2016, pp.134–143, Article ID: IJM_07_07_014

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A STUDY ON FACTORS AFFECTING LEARNING

ORGANIZATION
Ms. Reshma G Sable
Assistant Professor, Research Scholar, I2IM, CHARUSAT, Changa, Gujarat, India

Dr. Govind B Dave

Dean, Principal, FMS, I2IM, CHARUSAT, Changa, Gujarat, India

ABSTRACT
Purpose: The primary purpose of this research is to study the level of penetration of Learning
Organization concept in Sugar Industry. The research is focused on identifying the factors that
determine the existence of the Sugar factory as a learning organization.
Design/methodology/approach: The research was carried out at Sangamner Sahakari Sugar
Karkhana Ltd., Sangamner, Ahmed nagar district. The strengths of variables were tested using
factor analysis, while the literature review was conducted to explore the concept of learning
organization.
Findings: The result shows that learning organization concept consists of six different aspects
which are primarily related to the environment of the organization.
Research limitations/implications: The study is limited to the selected generalization of the
findings for other sugar industry/firms factories operating in Ahmed nagar district. Further
research can be carried out with more sample size and extended to other firms for better
generalization. This can strengthen the validity of current measurement tool.
Originality/value: The research presents specific variables that affect learning organization in
the sugar industry.
Key words: Learning organization, Organizational Learning, Organizational Leadership, Sugar
Industry
Cite this Article: Ms. Reshma G Sable and Dr. Govind B Dave, A Study on Factors Affecting
Learning Organization. International Journal of Management, 7(7), 2016, pp. 134–143.
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 A Study on Factors Affecting Learning Organization

1. INTRODUCTION
The concept of learning organization is more prominently reflected in the set up where there is a scope for
continuous improvement in the organizational processes through the learning mechanism. Even though
learning is considered to be a process; related to living beings, the organization as a whole was viewed as
living organization since 1990s, as the concept of learning organization (LO) was popularised (Senge
1990, Watkins and Marsick 1993,Garvin 1993). LO is more of an environmental concept, which occurs at
all levels of the organization. The research work carried out by Narver and Slater (1990) revealed that a
company’s ability to learn and innovate has been demonstrated to be a key driver of the company’s
capability to increase revenues, profits and economic value.
The concept of LO was more respected because Peter Senge (1990) placed importance on
organizational leadership which creates an environment for flourishing, where people continually expand
their capacity to generate desired results, where new and valuable patterns of thinking are nurtured, where
collective aspiration is set free, where people are continually learning how to learn together, and where
people are bonded firmly in the same boat with clear future destiny. In addition Garvin, Edmondson, and
Gino (2008) have also identified that organizational learning is strongly influenced by the behavior of
leaders. When leaders actively question and listen to employees and thereby prompt dialogue and debate
people in the institution feel encouraged to learn. Organizational listening and learning plays an efficient
role in the development of followers.
There has been an ample amount of research carried out in the area of learning organization in various
industries. But no attempt is made to test the level of penetration of LO concept in sugar industry. In other
words, there is no evidence of research being carried out to identify the various factors that affect the
existence of learning organization in sugar industry. Therefore, the present research aims to identify the
factors that contribute in building the organization as a learning organization in sugar industry. The present
research will demonstrate theoretical as well as an empirical significance. The concept of LO can be best
understood with the help of the learning organization model given by Peter Senge (1990). Empirically the
strength of variables contributing in building the learning organization can be tested. Further the empirical
findings can be made applicable to the organizations operating in sugar industry.

2. LITERATURE REVIEW
2.1. The Concept and Process of LO
The first significant work on learning organization is always credited to Peter Senge (1990). While laying
the foundation of learning organization model, Peter Senge (1992, 1993) has discussed about the three
most important level of work, required for existence of learning organization. The first level talks about
development, production and marketing of products and services. The second level focuses on the
designing and development of the systems and processes for production. The third level is concerned with
the thinking and interactions among organizational employees. In other words it tells us that the quality of
organizational thinking and interactions directly affects the organizational systems and processes and
production and delivery of products and services.

2.2. Antecedent / Independent Variables of the Study

Any organization can be referred as a learning organization only when it demonstrates sustainable
improvement in three major areas. Viz. development in production process and marketing of the finished
products, development of the organizational system as a whole and critical thinking and effective
interactions among organizational employees. This expected area of development is possible when the
organization is aware and conscious about few important factors that affect the process of building the
learning organization.
Literature review has resulted in few major factors that affect the learning organization in sugar
industry. These can be classified into five major categories:

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 Ms. Reshma G Sable and Dr. Govind B Dave

• Organizational Environment is defined as the prime factor that determines the existence of
learning organization. This is facilitated by the defined organizational culture and continuous
communication and daily dialog and inquiry.
• Organizational Leadership is defined as a variable that is demonstrated through the senior
management commitment and support, their extent of empowering others, their ability to re-enforce
learning, effectiveness with which the vision is communicated and imbibed among employees, and
continuous focus on knowledge acquisition, development, utilization and sharing.
• Effectiveness of Organizational Processes and Practices is defined as a factor that demands the
organization as a whole, to learn from the past mistakes and expects employees to introspect and
identify the reason/s for the failures. At the same time it focuses on innovations and research and
for this it strives to adapt and up-grade to the most updated technology. Learning organization
demands all its employees to demonstrate and perform to maximum of their abilities.
• Organizational Commitment is defined as a factor which expects employees to be adaptable to any
change. It narrows down to the individual employee’s capacity to learn and explore new things.
• Organizational Citizenship Behaviour is defined as a factor that affects the sustainability of
learning organization. It focuses on continuous learning, training and development. It demands
employees to be self-disciplined, cooperate and collaborate, voluntarily help each other and
demonstrate the ability to work as a team.
Depending on the classification of the factors affecting learning organization, a conceptual framework
as mentioned in Figure-1, was developed and researched upon in sugar industry at Ahmedanagar district in
Maharashtra. The current research is aimed at identifying the various factors that are responsible for
creating and sustaining a learning organization, especially in a sugar industry. For this purpose exhaustive
literature review was carried out, which resulted in identifying five different factors (viz. Organizational
environment, Organizational leadership, Organizational processes and practices, Organizational
commitment, and Organizational citizenship behaviour), that can contribute in building and sustaining a
learning organization. Figure-1 shows the diagrammatic representation of the linkages that can exist
between the factors identified to affect the learning organization. It further demonstrates the process of
formation and sustaining of learning organization with the prime focus on development, production and
marketing, designing and developing the systems, processes for production and critical thinking and
interactions among employees at all levels.

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 A Study on Factors Affecting Learning Organization

2.3. Research Framework/Model

Organizational Environment
• Organizational Culture
• Continuous Communication / Daily Dialog
& Inquiry
Organizational Leadership
• Senior Management commitment & support
• Empowering others
• Re-enforcing learning
• Shared vision
• Knowledge acquisition, development,
utilization and sharing

Organizational Processes & Practices

• Learning from mistakes / Action on LEARNING
Reflection
ORGANIZATION
• Focus on innovation and research
• Technological up gradation

Organizational Commitment
• Openness to change
• Individual’s readiness & capacity to learn

Organizational Citizenship Behaviour

• Continuous learning
• Training & development
• Self-discipline
• Team learning
• Co-operation & collaboration
• Voluntarily helping others

Figure 1 Research Framework & Expected Outcome

3. OBJECTIVE OF THE STUDY

The primary objective of the study is to identify the factors that affect the existence of learning
organizations in sugar manufacturing industry.

4. RESEARCH METHODOLOGY
The factors affecting learning organization and the strength of those factors were determined with the help
of factor analysis.

4.1. Sample and Data Collection

The data was collected from 138 employees of Sangamner Sugar factory. Convenience sampling method
was adopted during data collection. The data represented employees belonging to all departments of sugar
factory. 100% respondents were male, as sugar factory don’t employ female workers.

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 Ms. Reshma G Sable and Dr. Govind B Dave

4.2. Data Collection Instrument

The instrument used in data collection was self-constructed based on literature review and included 30
variables to be rated over on five point rating scale (from 1- Strongly disagree, 2- Disagree, 3- Neutral, 4-
Agree, 5- Strongly agree). The scale had five major dimensions which combined various factors affecting
learning organization. viz. Organizational Environment, Organizational Leadership, Organizational
Processes and Practices, Organizational Commitment and Organizational Citizenship Behaviour.

5. DATA ANALYSIS AND INTERPRETATION

The collected data was first of all subjected to identification of correlation between the variables used in
study. It was observed that a multicolinearity was existing between the variables (as shown in Table-1), of
the study hence the data was further subjected to the Factor Analysis. The data was analysed, using the
Statistical Package for Social Sciences (SPSS). Factor analysis was used to identify the most prominent
dimensions of learning organization that are more salient in manufacturing industry’s context. All 30 items
were factor analysed using principal component analysis followed by Varimax rotation. Kaiser-Meyer-
Olkin Measure of Sampling Adequacy resulted in the value 0.864, which is sufficiently large indicating
that the sample is adequate. The Chi-Square value was also significant, i.e. 3370.858 at 435 degrees of
freedom under Bartlett’s Test of Sphericity, which is significant at 0.05 level. The P-value is 0.000, for the
test and therefore fails to provide sufficient premises to accept the null hypothesis. On the other hand it
suggests that the alternative hypothesis is acceptable, which indicates that all variables under study are
correlated.
KMO and Bartlett's Test
Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .864
Bartlett's Test of Sphericity Approx. Chi-Square 3370.858
df 435
Sig. .000

5.1. Table-2: KMO and Bartlett’s Test

The initial factor solution resulted in six factors with eigen values greater than 1. Same is reflected under
the scree plot obtained in factor analysis.

Figure 3 Scree Plot Correlation Matrix

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 A Study on Factors Affecting Learning Organization

Table 1 Co-relation Matrix

Q-1 Q-2 Q-3 Q-4 Q-5 Q-6 Q-7 Q-8 Q-9 Q-10 Q-11 Q-12 Q-13 Q-14 Q-15 Q-16 Q-17 Q-18 Q-19 Q-20 Q-21 Q-22 Q-23 Q-24 Q-25 Q-26 Q-27 Q-28 Q-29 Q-30
Q-1 1.00 .613 .717 .599 .225 .483 .499 .470 .398 .430 .384 .311 .274 .109 .243 .483 .482 .497 .429 .495 .419 .307 .464 .514 .438 .566 .354 .344 .243 .483

Q-2 .613 1.00 .703 .487 .480 .387 .461 .486 .424 .306 .332 .347 .652 .497 .340 .242 .355 .299 .246 .279 .302 .497 .758 .688 .599 .469 .413 .560 .340 .242

Q-3 .717 .703 1.00 .583 .368 .521 .550 .459 .552 .383 .484 .539 .475 .340 .427 .422 .511 .449 .456 .462 .457 .460 .559 .561 .499 .476 .421 .473 .427 .422

Q-4 .599 .487 .583 1.00 .208 .418 .572 .383 .501 .443 .516 .512 .364 .289 .380 .349 .554 .554 .447 .522 .372 .345 .415 .370 .354 .356 .394 .500 .380 .349

Q-5 .225 .480 .368 .208 1.00 .090 .246 .331 .240 .192 .092 .227 .472 .441 .233 .135 .150 .141 .192 .178 .304 .450 .579 .381 .380 .427 .377 .447 .233 .135

Q-6 .483 .387 .521 .418 .090 1.00 .501 .537 .625 .430 .626 .539 .331 .181 .333 .490 .495 .377 .515 .439 .441 .279 .321 .396 .297 .340 .438 .312 .333 .490

Q-7 .499 .461 .550 .572 .246 .501 1.00 .477 .661 .466 .659 .576 .426 .317 .246 .404 .564 .528 .520 .567 .500 .328 .406 .428 .492 .380 .503 .532 .246 .404

Q-8 .470 .486 .459 .383 .331 .537 .477 1.00 .653 .455 .540 .380 .405 .265 .279 .449 .528 .449 .526 .550 .522 .595 .461 .406 .369 .346 .409 .440 .279 .449

Q-9 .398 .424 .552 .501 .240 .625 .661 .653 1.00 .480 .706 .611 .415 .345 .271 .427 .477 .446 .613 .478 .614 .486 .348 .390 .339 .343 .371 .366 .271 .427

Q-10 .430 .306 .383 .443 .192 .430 .466 .455 .480 1.00 .451 .433 .255 .200 .348 .426 .366 .298 .462 .423 .428 .409 .263 .185 .192 .416 .276 .246 .348 .426

Q-11 .384 .332 .484 .516 .092 .626 .659 .540 .706 .451 1.00 .641 .354 .248 .290 .382 .511 .386 .608 .569 .602 .311 .282 .369 .266 .230 .507 .364 .290 .382

Q-12 .311 .347 .539 .512 .227 .539 .576 .380 .611 .433 .641 1.00 .227 .217 .419 .307 .415 .332 .445 .417 .402 .284 .342 .246 .152 .261 .356 .285 .419 .307

Q-13 .274 .652 .475 .364 .472 .331 .426 .405 .415 .255 .354 .227 1.00 .710 .422 .087 .316 .221 .231 .171 .303 .466 .664 .667 .626 .296 .436 .547 .422 .087

Q-14 .109 .497 .340 .289 .441 .181 .317 .265 .345 .200 .248 .217 .710 1.00 .428 -.041 .130 .154 .121 .064 .237 .398 .605 .546 .525 .235 .402 .464 .428 -.041

Q-15 .243 .340 .427 .380 .233 .333 .246 .279 .271 .348 .290 .419 .422 .428 1.00 .097 .235 .251 .179 .278 .247 .228 .400 .289 .223 .261 .375 .293 1.00 .097

Q-16 .483 .242 .422 .349 .135 .490 .404 .449 .427 .426 .382 .307 .087 -.041.097 1.00 .513 .514 .451 .450 .448 .233 .188 .261 .293 .336 .327 .218 .097 1.00

Q-17 .482 .355 .511 .554 .150 .495 .564 .528 .477 .366 .511 .415 .316 .130 .235 .513 1.00 .768 .615 .724 .573 .294 .413 .429 .418 .172 .531 .505 .235 .513

Q-18 .497 .299 .449 .554 .141 .377 .528 .449 .446 .298 .386 .332 .221 .154 .251 .514 .768 1.00 .553 .579 .475 .224 .265 .340 .384 .202 .434 .385 .251 .514

Q-19 .429 .246 .456 .447 .192 .515 .520 .526 .613 .462 .608 .445 .231 .121 .179 .451 .615 .553 1.00 .740 .674 .396 .268 .298 .280 .297 .405 .343 .179 .451

Q-20 .495 .279 .462 .522 .178 .439 .567 .550 .478 .423 .569 .417 .171 .064 .278 .450 .724 .579 .740 1.00 .636 .372 .319 .320 .282 .349 .507 .420 .278 .450

Q-21 .419 .302 .457 .372 .304 .441 .500 .522 .614 .428 .602 .402 .303 .237 .247 .448 .573 .475 .674 .636 1.00 .453 .389 .365 .331 .429 .558 .322 .247 .448

Q-22 .307 .497 .460 .345 .450 .279 .328 .595 .486 .409 .311 .284 .466 .398 .228 .233 .294 .224 .396 .372 .453 1.00 .585 .440 .364 .435 .333 .442 .228 .233

Q-23 .464 .758 .559 .415 .579 .321 .406 .461 .348 .263 .282 .342 .664 .605 .400 .188 .413 .265 .268 .319 .389 .585 1.00 .685 .633 .440 .527 .604 .400 .188

Q-24 .514 .688 .561 .370 .381 .396 .428 .406 .390 .185 .369 .246 .667 .546 .289 .261 .429 .340 .298 .320 .365 .440 .685 1.00 .876 .461 .584 .608 .289 .261

Q-25 .438 .599 .499 .354 .380 .297 .492 .369 .339 .192 .266 .152 .626 .525 .223 .293 .418 .384 .280 .282 .331 .364 .633 .876 1.00 .416 .542 .615 .223 .293

Q-26 .566 .469 .476 .356 .427 .340 .380 .346 .343 .416 .230 .261 .296 .235 .261 .336 .172 .202 .297 .349 .429 .435 .440 .461 .416 1.00 .518 .455 .261 .336

Q-27 .354 .413 .421 .394 .377 .438 .503 .409 .371 .276 .507 .356 .436 .402 .375 .327 .531 .434 .405 .507 .558 .333 .527 .584 .542 .518 1.00 .649 .375 .327

Q-28 .344 .560 .473 .500 .447 .312 .532 .440 .366 .246 .364 .285 .547 .464 .293 .218 .505 .385 .343 .420 .322 .442 .604 .608 .615 .455 .649 1.00 .293 .218

Q-29 .374 .541 .464 .365 .375 .232 .470 .374 .270 .315 .335 .210 .480 .374 .277 .286 .445 .402 .222 .381 .352 .363 .542 .619 .644 .378 .685 .706 .277 .286

Q-30 .447 .529 .467 .342 .443 .361 .352 .464 .419 .346 .237 .221 .456 .311 .277 .271 .262 .265 .224 .313 .285 .525 .503 .532 .478 .576 .472 .596 .277 .271

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 Ms. Reshma G Sable and Dr. Govind B Dave

The six-factor solution accounted for 71.938% of variance.

Total Variance Explained

Extraction Sums of Squared Rotation Sums of Squared
Initial Eigen values Loadings Loadings
% of Cumulative % of Cumulative % of Cumulative
Component Total Variance % Total Variance % Total Variance %
1 13.047 43.489 43.489 13.047 43.489 43.489 6.333 21.108 21.108
2 3.327 11.091 54.580 3.327 11.091 54.580 5.174 17.247 38.355
3 1.587 5.291 59.871 1.587 5.291 59.871 2.716 9.054 47.409
4 1.384 4.612 64.483 1.384 4.612 64.483 2.691 8.971 56.379
5 1.226 4.088 68.571 1.226 4.088 68.571 2.583 8.609 64.989
6 1.010 3.367 71.938 1.010 3.367 71.938 2.085 6.949 71.938
7 .930 3.100 75.037
8 .773 2.576 77.614
9 .752 2.508 80.122
10 .655 2.182 82.304
11 .633 2.112 84.415
12 .502 1.672 86.087
13 .438 1.461 87.549
14 .416 1.387 88.936
15 .396 1.322 90.257
16 .365 1.216 91.473
17 .327 1.090 92.563
18 .298 .993 93.556
19 .269 .896 94.452
20 .248 .828 95.281
21 .236 .787 96.067
22 .212 .705 96.772
23 .196 .655 97.427
24 .170 .566 97.993
25 .148 .494 98.487
26 .139 .462 98.949
27 .108 .361 99.310
28 .092 .307 99.617
29 .067 .224 99.841
30 .048 .159 100.000
Extraction Method: Principal Component Analysis.

Figure 4 Total Variance Explained

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 A Study on Factors Affecting Learning Organization

In Rotated Component Matrix, items which had no strong loading (less than 0.5) on any of the factors were
identified and consequently eliminated.

Rotated Component Matrixa

Component
1 2 3 4 5 6
Continuous questioning and feedback .302 .166 .137 .803 .246 .098
Organizational support for shared learning .135 .685 .059 .480 .261 .161
Contribution in organizational decision making .353 .401 .086 .582 .194 .305
Focus on productive reasoning skills .382 .200 .248 .453 .028 .437
Open systems of communication .070 .470 .127 -.061 .559 .056
Effective knowledge sharing .588 .172 -.015 .348 .065 .302
Promoting dialogue .576 .285 .273 .259 .024 .294
Contribution towards organizational goals and targets .667 .317 .015 .152 .332 -.011
Challenge employees to do better .761 .308 -.106 .134 .153 .238
Knowledge from internal and external environment .461 -.025 .011 .204 .425 .381
Transparency in sharing vital information .743 .186 .100 .072 -.036 .374
Knowledge creation and sharing .517 .114 -.020 .150 .049 .634
Zero or minimum mistakes .168 .835 .095 .029 .112 .198
Proper analysis of mistakes .066 .789 .074 -.174 .088 .303
Reflection and introspection of mistakes .076 .241 .171 .040 .139 .740
Continuous innovation .530 -.088 .176 .480 .182 -.087
Technological updation .661 .160 .493 .288 -.123 .026
Continuous R & D .550 .086 .479 .360 -.128 .027
Welcome change .825 .047 .167 .103 .117 .030
Acquiring new skills and knowledge .703 -.035 .428 .175 .161 .096
Easy adaptation to change .737 .137 .230 .001 .281 .044
Taping people’s commitment & capacity to learn .416 .451 -.071 .001 .576 -.030
Understand new changes .159 .726 .192 .190 .315 .140
Recognition for contribution .174 .744 .325 .327 .124 -.023
Learning for education and growth .146 .710 .409 .302 .080 -.102
Learning to stand in market competition .123 .142 .215 .350 .710 .160
Reinforcing level of knowledge and needs .329 .313 .675 .000 .259 .223
Value and reward collaboration .200 .506 .581 .097 .260 .140
Work and learn together .112 .420 .677 .159 .288 .085
Collective work towards common goal .109 .350 .297 .249 .619 .085
Extraction Method: Principal Component Analysis.
Rotation Method: Varimax with Kaiser Normalization.
a. Rotation converged in 17 iterations.

Figure 5 Rotated Component Matrix

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 Ms. Reshma G Sable and Dr. Govind B Dave

The factors identified through Rotated Component Matrix, with strong loading (greater than 0.5) were
placed together and labelled. Thus the Factor Analysis has resulted in identification of six major factors
that are found to affect the learning organization in sugar manufacturing industry.
The factors with loading with Eigen value greater than 0.5 are as follows:

Factor Labeling Variable Details Loading

Effective knowledge sharing 0.588
Promoting dialogue 0.576
Contribution towards organizational goals and targets 0.667
Challenge employees to do better 0.761
Factor-1:
Transparency in sharing vital information 0.743
Organizational Leadership,
Technological updation 0.661
Commitment & Innovation
Continuous R & D 0.550
Welcome change 0.825
Acquiring new skills and knowledge 0.703
Easy adaptation to change 0.737
Organizational support for shared learning 0.685
Zero or minimum mistakes 0.835
Factor-2: Proper analysis of mistakes 0.789
Learning Organization Understand new changes 0.726
Recognition for contribution 0.744
Learning for education and growth 0.710
Reinforcing level of knowledge and needs 0.675
Factor-3:
Value and reward collaboration 0.581
Team Work
Work and learn together 0.677
Factor-4: Continuous questioning and feedback 0.803
Organizational Culture Contribution in organizational decision making 0.582
Open systems of communication 0.559
Factor-5: Taping people’s commitment & capacity to learn 0.576
Organizational Learning Learning to stand in market competition 0.710
Collective work towards common goal 0.619
Factor-6: Knowledge creation and sharing 0.634
Organizational Development Reflection and introspection of mistakes 0.740

6. CONCLUSION
Literature review resulted in identifying various viz. Organizational environment, Organizational
leadership, Organizational processes & practices, Organizational commitment, and Organizational
citizenship behaviour.
Empirically it is proved that the variables that affect the existence of learning organization in sugar
industry can be classified into six different variables, viz., Organizational Leadership, Commitment,
Innovation and Training, Adaptation to change, Learning Organization, Team Work, Organizational

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 A Study on Factors Affecting Learning Organization

Culture, Organizational Learning, and Organizational Development. All these factors collectively were
found to affect the existence of learning organization in sugar industry.
All these factors are primarily contributing to the continuous process of building and sustaining
learning organization. This is feasible only when the organizational focus is on development production
and marketing, design & development of systems & processes for production and critical thinking and
interactions among employees at all levels.

7. MANAGERIAL IMPLICATIONS
The prime purpose of research is to identify the extent to which the concept of learning organization is
penetrated in a sugar manufacturing factory. The various factors that affect the existence of learning
organization is sugar manufacturing industry were empirically tested and identified. The current research
also provides basic guidelines for further researches in similar and diverse industries.
The research has demonstrated the validity of the claim that learning organizations also exist in sugar
industry. Further the existence of learning organization in sugar industry is backed by various variables. If
an organization focus more on nurturing the six significant factors identified through research, then it can
certainly become a learning organization in future. In essence, the firm/organization in general and sugar
industry in particular can concentrate its efforts on the new named variables to achieve progress for being
learning organization.

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