The report analyzes the concept of learning organization and its importance in the 21st century organizations. It also studies about HRM and its role and challenges in a learning organization. This report is analyzed on the basis of a case study on Southwest Airlines. It also makes a critical comparison between the British Airways and Southwest Airlines in regards to learning organization and continuous improvement. By analyzing the Harvard and Michigan model of HRM, the report tries to understand which model of HRM is practiced by Southwest Airlines. From this case study we can understand that the key factor behind the success of Southwest Airways is continuous improvement and its full utilization of the resources. Its mission of low cost, low fare, no frill is the dedication to its highest quality of customer service which is delivered with a sense of warmth, friendliness, individual pride and company spirit. These all are included in the policies and procedures of the Company that are developed by the HRM department. So although there are some challenges to HRM in a learning organization it has a crucial role to play in every organization.
Learning organization means “organizations where people continually expand their capacity to create the results they truly desire, where new and expansive patterns of thinking are nurtured, where collective aspiration is set free, and where people are continually learning how to learn together” (Senge, 1990, p. 3). From this definition we can understand that learning organization is a team and organizational process rather than individual and it is a continuous never ending process. It is essential for a learning organization to make creative and better ways of learning and improving its performance. It becomes a part of the continuous process of sharing information with people and the environment, and exchanging and disseminating information. A learning organization is entirely different from a traditional organization as it has the capacity to make changes continuously. The theory of organizational learning stresses the importance of policies and procedures inside the organization in response to the outside consequences even though they are positive or negative the firm learns from its experiences. Learning has only very little to do with getting information, rather it is merely a process for enhancing capacity. Learning is for making new kinds of developments that the organization could not achieve in the past (Lassey, 1998). The principle assumption of learning organization, therefore, is that if learning from the part of individuals is improved, organizational performance also will improve. Senge (1990) identified five disciplines which are essential to the development of learning organizations in his opinion. These disciplines are the distinguishing factors behind the learning organization and a traditional organization. Those disciplines are personal mastery, mental models, shared vision, team learning and system thinking. Personal mastery tries to acquire the academic expertise and efficiency that they got from their activities and experiences. Mental model focuses on an individual’s basic world view, which is reinforced by structures, experiences, cultures and belief systems. This model guides and directs people as they make decisions, and are used to filter ideas and possibilities. Shared vision is the collective perspectives of employees and evolves from their understanding of the organization’s mission. In traditional organizations, shared vision is not commonplace, because little or no effort is made to internalize or understand the firm’s mission. Shared vision is, however, a cornerstone of learning organizations because it requires a common view of learning by all types of members from top to bottom in an organization. This discipline also helps the organizations allocate its various kinds of resources towards its objectives (Beiske, 2007).