The Fifth Discipline by Peter Senge

Indeed, not all external knowledge may be easily used and transformed into new artefacts. If external knowledge is easily accessible, transformable into new artefacts and exposed to many actors (such as customers and suppliers), then innovative entry may take place (Winter, 1984). On the contrary, if advanced integration capabilities are necessary (Cohen and Levinthal, 1989), the industry may be concentrated and formed of large established firms. Third, the domain relates to the degree of accessibility of knowledge (Malerba and Orsenigo,

2000), i.e. opportunities of gaining knowledge that are external to firms. Knowledge that is accessible may be internal or external to the sector. In both cases, greater accessibility of knowledge decreases industrial concentration. Another dimension states that knowledge may be also cumulative, i.e. the degree to which the generation of new knowledge builds upon current knowledge (Malerba, 2002b). He identifies three different sources of cumulativeness. The first source is learning processes and dynamic increasing returns at the technology level. The cognitive nature of learning processes and the past knowledge constrain current research, but also generate new questions and new knowledge. The second source is related to organisational capabilities.

These capabilities are firm specific and can be improved only gradually over time. They implicitly define what a firm learns and what it can hope to achieve in the future. A third source is the feedbacks from the market, such as

ʻsuccess-breeds-success’ processes. Innovative success yields profits that can be reinvested in R&D, thereby increasing the probability to innovate again.

Indeed, even if there has been a growing culture of evaluation over the ...

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...oriented predominately towards controlling rather than learning, rewarding individuals for performing for others rather than for cultivating their natural curiosity and impulse to learn.

Successful organisations encourage employee innovation as a way to produce measurable improvements in quality, quantity, and cost-effectiveness (Hale, 1996).

In The Fifth Discipline, Senge (1990a) identifies five new ʻcomponent technologies’ that he claimed were gradually converting to learning organisations – systems thinking, personal mastery, mental models, building shared vision, and team learning.

Also, as seen in the previous sub-chapter, innovation and risk taking are inseparable in a learning organisation, which Spear (1993: 14) defines as “a place of truth-seeking and speaking without fear of reprisal or judgement … a place where curiosity reigns over knowing and where exp