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Learning Networks - INTRODUCTION, BACKGROUND, Shift from Bureaucracies to Networks, Shift from Training and Development to Learning

knowledge value lns collaboration

Albert A. Angehrn
Center for Advanced Learnimg Technologies, INSEAD, France

Michael Gibbert
Bocconi University, Italy


Herb Simon once said that “all learning takes place inside individual human heads[;] an organization learns in only two ways: (a) by the learning of its members, or (b) by ingesting new members who have knowledge the organization didn’t previously have” (as cited in Grant, 1996, p. 111). What Simon seems to be implying is that while organizational learning can be seen as linked to the learning of individuals, these individuals need to be employed by the organization intending to appropriate the value of learning.

We partially agree. Take one of the most fundamental processes—learning—and combine it with one of the most powerful processes to create and distribute value—networks. What emerges is the concept of learning networks (LNs). LNs come in many forms. Two generic forms of LNs stand out. First, LNs that focus on learning and knowledge-sharing processes within one organization. This perspective is endorsed by Herb Simon and is also at the heart of knowledge management in that it understands learning as the sharing of knowledge among employees of the same company (e.g., Davenport & Prusak, 1998; von Krogh & Roos, 1995). The internal perspective on learning has its roots in theories of organizational learning in that it sees learning as a process that helps the organization maintain a competitive advantage by careful management of employee’s knowledge (Senge, 1990).

But a second form of LNs, which focuses on knowledge sharing between organizations, comes to mind. This perspective has its roots in the area of interorganizational collaboration. Interfirm collaborations broadly refer to a variety of interorganizational relationships such as joint development agreements, equity joint ventures, licensing agreements, cross-licensing and technology sharing, customer-supplier partnerships, and R&D (research and development) contracts (e.g., Dyer & Singh, 1998). Researchers have two streams of thought. One focuses on vertical collaboration, that is, customer-supplier relationships that are characterized by legally binding contracts (e.g., Dyer & Nobeoka, 2000). While most literature focuses on those interorganizational relationships that are specified in formal agreements, the knowledge exchange may take place in social networks that are governed by shared norms of the exchange instead of legally binding contracts (Liebeskind, Oliver, Zucker, & Brewer, 1996; Powell, 1998; Powell, Koput, & Smith-Doerr, 1996).

It is on this second stream of thought where we put the emphasis in this article. Four objectives are pursued. First, we intend to define the concept of LNs by way of comparing it with related constructs on both the intra-organizational and interorganizational levels. Second, we trace important developments in the competitive environment that seem to lead to an increasing importance of LNs as we interpret them. Third, and most importantly, we outline what we call the three key challenges (cf. Gibbert, Angehrn, & Durand, in press) that seem to characterize LNs. Finally, we outline important future trends that seem to shift the emphasis among the three key challenges. Here, we briefly preview these three key challenges:

  • “Real” vs. virtual forms of interaction: Individual members of LNs may interact directly (i.e., person to person) and virtually (i.e., through technology-mediated channels). It is unclear, however, which form of collaboration is most efficient in the learning process.
  • Collaboration vs. competition for learning outcomes: This arises since LNs involve horizontal collaboration, that is, collaboration among competitors, and because there are typically no formal, legally binding contracts to govern the collaboration.
  • Value creation vs. value appropriation: A related issue is the extent to which organizations in an LN may be subject to free-riding behavior.


The emergence of LNs should be seen against the background of a number of shifts in the institutional, business, and broader societal environments (e.g., Grant, 1996; Spender, 1996a, 1996b; Stewart, 1998). Leibold, Probst, and Gibbert (2002) list a number of major forces causing significant shifts in strategic management thinking and implementation. The main shifts involved in the emergence of LNs are from

  • bureaucracies to networks,
  • training and development to learning, and
  • competitive to collaborative thinking.

Shift from Bureaucracies to Networks

The traditional hierarchical designs that served the industrial era are not flexible enough to harness the full intellectual capability of an organization. Much more unconstrained, fluid, networked organizational forms are needed for effective, modern decision making. The strategic business units (SBUs) of the Alfred P. Sloan era have given way to the creation and effective utilization of strategic business networks (SBNs) by a given enterprise. Progressive organizations establish strategic business systems (SBSs) with multiple networks, interdependent units, and dual communications. The reality is that effective organizations are neither hierarchical nor networked, but a blend of both. Based on a company’s traditions and values, different priorities would be placed on the management spectrum. The important thing is that there is flexibility built into the managerial system to capitalize on opportunities while simultaneously ensuring proper responsibility and accountability. This notion of constrained freedom is more complex than it appears, but holds significant creativity and innovation benefits for the enterprise.

Shift from Training and Development to Learning

The role of education has become paramount in all organizations—public and private. However, the change has been from a passive orientation with a focus on the trainer and the curriculum to an active perspective that places the learner at the heart of the activity. In fact, learning must occur in real time in both structured and informal ways. Detailed curriculums have given way to action research by teams as the best way to advance the knowledge base. The new lens requires one to realize the real-time value of learning—in the classroom, on the job, and in all customer and professional interactions. Learning is the integral process for progress. It is an investment rather than a perceived expense to the organization. The knowledge that one creates and applies is more important than the knowledge one accumulates. New techniques, such as collaborative teams and action research, can be easily incorporated into the culture.

Shift from Competitive to Collaborative Thinking

We live in an era dominated by competitive-strategy thinking, one that produces only win-lose scenarios. Even in a cooperative environment, parties divide up the wealth to create a win-win situation. The pie, however, often remains the same. With a collaborative approach, symbiosis creates a larger pie to share or more pies to divide. Alliances of every dimension are the natural order of the day in the realization that go-it-alone strategies are almost always suboptimal. The last decade has been bursting with institutionalized examples of competitive strategy. It is time to remove the barriers to progress and to establish mechanisms of communication, collaboration, and partnership that transcend current practice. The emerging collaborative practices among traditional competitors, for example, supply-chain collaboration between GM, Ford, and Daimler Chrysler in the automotive industry, illustrate this shift to collaborative learning and strategy.


The three key challenges outlined in the introduction are at the heart of interorganizational collaboration involving competing firms.

An analysis 1 of the key governance and value-creation processes of LNs has helped us identify three key challenges of learning in networks: real vs virtual forms of interaction, collaboration and competition in the learning process, and value creation and appropriation in networks.

Real vs. Virtual Forms of Interaction

An interesting development is the inclusion of information technology to facilitate learning in networks. Recent evidence of the inclusion of information technology as a facilitator in LNs includes e-learning and communities of practice that are globally dispersed. The key advantage of information technology in these contexts is efficiency, that is, driving down the cost of the communication and distribution of knowledge. However, despite this promise, the usage of information technology as an enabler to learning in networks poses significant challenges in terms of issues such as “direct touch,” building trust, capturing the attention of the members of a learning network, and sustaining learning in computer-mediated, distributed environments. Furthermore, IT has enabled the emergence of new forms of distributed, collaborative learning and knowledge creation as witnessed, for example, by the way open-source communities operate. However, the applicability of this model of learning (by doing) in open-source networks seem limited to the software-development realm, and its promise in contexts other than software development is still an open question.

Collaborating vs. Competing in Learning

LNs draw their value from the collaborative attitude of their members. The collaborative attitude seems to be a function of how well members “speak the same language” (i.e., share the same ontology). However, sharing the same ontology usually means that knowledge-sharing partners operate in similar industries, and even in similar stages of the value chain (E.g., engineers from a company in the automotive-supplier industry talk to engineers from another company). In other words, the learning potential is greatest when interacting parties are competitors. This suggests that an appropriate balance be sought between collaboration and competition, dealing with issues of free-riding problems, non-sharing behavior, and especially the unintentional transfer of knowledge while learning in inter-organizational networks.

Distributed Value Creation vs. Focused Value Appropriation

LNs potentially enable the emergence of different types of value, in particular, knowledge exchange, knowledge creation, and synergies, leading to intellectual capital, social capital, and the development of individual competencies of members. But it is nevertheless still unclear to what extent such value-creation sources can be linked to more traditional (and accepted) performance indicators. In other words, it still seems an open question how the value created in the network can be quantified using tangible rather than intangible indicators. Furthermore, the problematic quantification leads to an additional challenge: Which mechanisms have to be put in place to guarantee a fair redistribution of the value created within such a network? (E.g., how can companies cooperating with their customers within the learning network redistribute the value thus created fairly to customers as the co-creators of this value?)


Are the three key challenges equally important, or will there be shifts in emphasis over time? Based on our research, we expect a shift in importance toward the nature of interaction as summarized in the first challenge, virtual vs real forms of interaction.

Is High Touch Better Than High Tech?

In the traditional line of thinking, high tech is useful to save money but does not seem fully satisfactory in all instances, and it must therefore be enhanced by some high-touch elements. High touch in this context means either (a) at some stage(s) in the LN formation, there has to be a moment when members meet in real time and space, or (b) an LN’s communication process can be enriched by interactive technologies that simulate high touch (e.g., teleconferencing, etc.).

The underlying assumption is that somehow we, as human beings, prefer to meet in real time and space (e.g., Zuboff, 1988), and that information technology as a vehicle for transmitting knowledge in some way or other deprives us of the richness of shared social experience. Contributing to this assumption is that some forms of knowledge, particularly tacit knowledge (e.g., Polanyi, 1958), seems to require the sustained collaboration between human beings, in other words, direct contact. Such tacit knowledge, which is often intricately bound to the individual experience, is in many ways more art than science, and is typically not expressible in virtual interaction, say, in e-mails. For example, it seems hard to learn how to cook a Thanksgiving turkey from reading cookbooks or joining a Thanksgiving newsgroup. The apprenticeship system in Europe pays witness to this form of learning by doing where a master craftsman passes on his or her art to the apprentice. Most of the arts use this approach to learning.

Or Is High Tech Better Than High Touch?

What if we let go of this preconception? What if we think that high touch is more difficult than high tech, precisely because it introduces interpersonal variables that might interact with the knowledge-sharing and creation process. Can we bracket these interpersonal variables off and still get the same quality of learning? What if we take a more differentiated look at what needs to be learned? While certainly the art of cooking requires sustained direct interaction of one master and a handful of apprentices, perhaps other areas require less direct contact; perhaps direct contact may even be counterproductive.

Most knowledge-sharing platforms try to substitute direct interaction with some form of technology-enabled interaction. The reason is that it is simply more cost effective to get Mrs. Brown from the office in lower Manhattan to talk to Mr. Mueller in the Milan office by e-mail, telephone, or videoconference than to have them meet in the United States or Italy.

But is there an argument for high tech beyond the cost-efficiency idea? Have you ever phoned someone, hoping to leave a message rather than having to speak to them? Perhaps it is late at night over there and you do not want to disturb them, or perhaps you just do not have the inclination for a long call. You intentionally call the person at lunchtime or in the office after work 2 . Perhaps, on some occasions, technology, precisely because it severs the ties between time and space, enables us to be more purposeful in the choice of our communication media. Perhaps this purposefulness enables us to learn better and, yes, more efficiently in a high-tech environment than under high-touch circumstances.

Admittedly, this may not work in the example of the master chef and his or her apprentice. But there are other forms of learning and knowledge creation. Consider the open-source approach. Here, not one master and one apprentice interact, but tens of thousands of masters and tens of thousands of apprentices—and it is often not clear who is who and which is which. Almost all members in an open-source context have never met and never will meet. And yet, open-source development is extremely successful in the context of software development. But how does this open-source model apply to other contexts, other industries, and countries other than the United States?


When members from different organizations come together to exchange insights, share knowledge, and create value, they come together in what we call a learning network. Learning networks differ from other forms of value creation and appropriation in that they are inter-organizational, membership is not subject to formal governance processes, and they tend to involve strong elements of virtual interaction.

The concept of inter-organizational knowledge exchange is not new, having been practiced at least since the Middle Ages, where, for example, guilds provided members with learning arenas for the exchange of best practices, trade regulations, and tariffs. What is new, however, is the predominance of virtual vs real interaction, the focus on collaboration rather than on competition, and the emphasis on value creation on the network rather than individual level.

Each of these three main processes that distinguish learning networks from their predecessors poses a key challenge, which we summarized here as (a) high tech vs high touch, (b) joint value creation vs focused value appropriation, and © collaboration vs competition. More research will be necessary to address each of the three key challenges identified here. In the future, we expect to see relatively more work done on the third key challenge since the role of information technology as an enabler or constraint to learning is not clear.

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over 3 years ago

I appreciate the article and how we are moving toward collaboration. I believe with "teaming" we can learn about what tools we like to incorporate in our own work and which things do not work. I notice how I pick things up by just watching (my mentor) so much more than reading about or even direct instruction. I also notice when watching other interpreters work, what skills I do not want to develop.

Regarding the High Tech example; most of us utilize the commodity of text messaging! We can communicate the point without using the time it used to take to phone someone, or ride over to their house on our horse!

Getting together and sharing stories, skills and history is what attracts me!! I have great memories of learning oceans of knowledge on a silent weekend many years ago! I am looking forward to our own networking and collaboration!

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over 3 years ago

I appreciate the article and how we are moving toward collaboration. I believe with "teaming" we can learn about what tools we like to incorporate in our own work and which things do not work. I notice how I pick things up by just watching (my mentor) so much more than reading about or even direct instruction. I also notice when watching other interpreters work, what skills I do not want to develop.

Regarding the High Tech example; most of us utilize the commodity of text messaging! We can communicate the point without using the time it used to take to phone someone, or ride over to their house on our horse!

Getting together and sharing stories, skills and history is what attracts me!! I have great memories of learning oceans of knowledge on a silent weekend many years ago! I am looking forward to our own networking and collaboration!

Vote down Vote up

over 3 years ago

We are reading this at the beginning of the Master of Interpreting Studies at Western Oregon University. It is appropriate to our cohort because we are embarking upon an 18-month journey together as a learning network (LN). We will meet in person for two-week colloquia once each summer and learn/teach together online the rest of the time. One thing I highly agree with is doing what cannot be done online in-person and vice versa. I get annoyed with in-person meetings that accomplish nothing more than blabber about things simply because people can talk faster than they can type!