Small Business Cooperative Forum: Creating a Learning Culture in the Accounting Department

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Abstract This article introduces the concept of a learning organization or culture. It also identifies why such a culture is important by identifying various benefits seen by organizations that have implemented a learning environment. Two approaches to implementing learning cultures are described along with the assessment tools associated with each one. Either or both approaches and tools will allow a manager the opportunity to assess their department’s or organization’s current standing in terms of where they are as a learning culture and where they can improve.

What is a Learning Organization or Learning Culture? According to Gavin, Edmonson, and Gino (2008), a learning organization or culture is one in which its employees create, acquire, and transfer knowledge in order to assist their company to adapt more quickly than their competition. Why would an organization want to create a learning culture? Many benefits have been identified with a strong learning culture (Blackwood, 2014).

Small Business Coop Forum

Editor Barbara A. Wech Department of Management, Information Systems, and Quantitative Methods University of Alabama at Birmingham Collat School of Business CSB 364 bawech@uab.edu

These benefits include, but are not limited to, gains in efficiency, productivity, job satisfaction, organizational commitment, the ability to deal with change, and increased profits. Such organizations have experienced decreased turnover, as well.

Why? If your company does not have a focus on a learning organization, should your accounting department consider creating and maintaining a

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learning culture? Evidence suggests the answer is you with a couple examples of how to implement “Yes.” Thomson Reuters (2017) published By Barbara a white A. a Wech learning culture in your area. paper which identified reasons why accounting firms (and consequently accounting departments) How to Implement a Learning Culture should be interested in implementing a learning There are numerous ways to go about culture. One reason has to do with attraction establishing and reinforcing a culture of and maintenance of new accounting talent. We learning. I have selected two approaches to know that as the economy improves and there introduce to you. These are straightforward are more opportunities, it is a good situation for and offer assessment tools that allow for actual people looking for jobs which is leading to a high implementation. Sarder (2016) has identified amount of turnover of accountants (AICPA Private that learning cultures have four characteristics: Company Practice Section, 2015). With the job the right leaders, the right people, the right market as challenging and tight as it is for hiring behaviors, and the right resources. He also companies, instituting a learning culture can be offers a set of questions to help you establish seen as a competitive advantage over others. where you are and where you need to go on your

Another reason to focus attention on a learning culture journey. The second approach, learning culture has to do with Millennials. This developed by Garvin et al. (2008), has identified generation, born between 1980 and 1996, three building blocks on which to build a expects that the organizations they go to work learning culture. Out of their research, they have for will be providing professional development developed an assessment tool to evaluate how opportunities. Having opportunities to learn well you are doing in each of the three building and develop is one of the highest priorities of blocks. this group in searching for a job and remaining with an employer (Gallup, 2016). If potential Sarder’s Framework for Building a Learning employees do not see that their hiring

Culture organization and department value education As already noted, Sarder (2016) has identified four and development, they may view that employer characteristics of a learning culture. They include not interested in investing in the futures of their having the right leader, the right people, the right employees and decide to look elsewhere. behaviors, and the right resources. Let’s look at

That brings us to another reason for instituting each of the four in more detail. a learning culture: developing employees to be Most everyone agrees that a learning culture future leaders in the accounting function and starts at the top. At the organization level, this the organization. With the tight labor market, would be the CEO. At the department level, this it is more beneficial to train employees in areas would be the department manager, etc. It is where they have gaps than to go out and try and crucial that this individual supports learning and hire a new employee. In most organizations, is a learner. The right leader values learning and even if the labor market is conducive to hiring communicates that to employees. He or she can new employees, many will not want to spend explain why learning is important to achieving the money to add additional employees. Also, the goals and objectives of the organization and training current employees makes sense because of the individual employee. The right leader is you are familiar with the employees and their also a role model for learning. In other words, the performance and future abilities. A learning right leader walks the talk. The leader provides culture helps bolster succession plans and training learning opportunities and rewards those who people to get them where you need them to be take advantage of the opportunities. in the future.

The leader cannot create and maintain a

With increased competition, continual learning culture alone. Other employees are advances in technology, and changing customer needed to support the learning environment. expectations, creating a learning culture is The right leader seeks out these right employees crucial (Garvin et al., 2008). So why haven’t more within the organization. The leader also makes companies done it? They do not know how to do sure when hiring that employees are selected who it. The remaining part of this article will provide not only are qualified for the job that is open, but

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who seek to learn more in order to advance and improve. The right people do not fear change but rather see it as an opportunity. The right people look at mistakes and difficult problems as learning prospects.

The right behaviors from leaders and employees are important for a learning culture. Sarder (2016) identifies four behaviors as indicative of a learning culture: collaboration, innovation, experimentation, risk taking, and information sharing. Employees who are learning share information and debate the correct solutions. To enable a learning environment, management must support a safe environment: one where people are not punished or humiliated when mistakes are made. Mistakes should be viewed as a part of the learning process. Employee inputs are valued even if the inputs are criticisms. All managers at all levels should display the behaviors of the right leader: fostering learning and being learners themselves. Policies and procedures should be reviewed and modified if they do not support the sharing of information, collaboration, etc. Barriers to learning should be removed and that is an important role of managers at all levels. Physical spaces should promote communication and collaboration. Even if people have separate offices, a shared, open space should exist for collaboration.

The right resources should be committed to support the learning culture. As accountants, you know one resource involved here is money. Money must be committed to support learning where it is necessary, such as for training. Time away from work is another resource. Employees may need time away for training or for collaboration on problem-solving.

In order to help managers create and implement a learning culture, Sarder (2016) has identified 30 questions to be addressed. Once the questions are answered, they can help you identify where you are at in terms of a learning culture and where you need to make changes. Not all questions may be pertinent to your situation, so you may need to select what applies to your organization or department. The response set to the questions would be as follows:

● Yes, to a great extent

● Seldom, if ever

● To some degree

● Don’t know

1. Do we continuously ask ourselves what’s working, what’s not, and what we can do to get better?

2. Do our managers and leaders acknowledge mistakes and ask for help when they need it?

3. Do we encourage employees to speak their minds and ask questions about – and perhaps to challenge – our decisions?

4. Do our managers see themselves as coaches, mentors, and facilitators whose most important job is to help employees do their best work?

5. Do people at all levels listen to and respect one another’s ideas, concerns, and points of view even if they disagree?

6. Does everyone in this organization continuously look for ways to improve our products, services, processes, policies, and procedures?

7. Do our employees feel safe enough to take risks, experiment with new ways of doing things, and make the mistakes that are an essential part of the learning process?

8. Do managers, teams, and individuals at all levels openly share information and have ready access to the information they need?

9. Have we eliminated policies, procedures, and structures that create unnecessary bureaucracy?

10. Do we value learning enough to include learning and development as an essential budget item even when times are tough? 11. Are our employees engaged in their work? 12. Do people seek ways to help one another succeed? 13. Are we able to attract and retain the employees we want?

14. Do our human resources and compensation policies reward people for learning and for helping others learn?

15. Do managers give people the time they need to learn, reflect on their learning, and apply what they learn on the job?

16. Do we offer a variety of learning options to meet a diversity of learning needs and styles?

17. Do we ensure that learning goals, initiatives, programs, and activities are clearly aligned with our mission, values, strategic goals, and business needs?

18. Do our senior leaders serve as role models by

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being learners themselves?

19. Do our employees understand the value of learning to their own and the organization’s success?

20. Do we use technology such as social media and electronic bulletin boards to help people learn and share what they learn?

21. Do we learn from and share our learning with our customers, vendors, and others outside the organization?

22. Do our senior managers seek input from others both inside and outside the organization before making important decisions and then clearly explain the reasons for those decisions?

23. Do we learn from other organizations’ best practices?

24. Are we willing to change even longestablished practices when something isn’t working or we discover a better way to accomplish our goals?

25. Do our employees generally see problems as learning opportunities?

26. Do people at every level give credit where credit is due?

27. Does the design of our workplaces encourage people to communicate with one another?

28. Do managers help employees set development goals as well as performance goals?

29. Do we have an effective system for managing our learning operation so that things run smoothly and efficiently?

30. Do we assess our learning programs regularly to see how well they are working and make necessary changes?

Garvin, Edmondson, and Gino’s Building Blocks of a Learning Organization Garvin et al. (2008) identified three building blocks to a learning organization. As noted earlier, if your organization is not involved in the effort, focus your attention on your department. The building blocks apply there, as well. Their three building blocks are: a supportive learning environment, concrete learning processes, and leadership that reinforces learning. Let us look at each one in turn.

A supportive learning environment has 4 characteristics. The first characteristic is psychological safety. Similar to Sarder (2016),

employees must feel safe to make mistakes, ask questions, disagree, etc. without fearing punishment, belittling, or other negative retaliatory behaviors. The next characteristic is the appreciation of differences. We learn by assessing and debating opposing ideas. The third characteristic is openness to new ideas. This involves risk taking and exploring the unknown. Lastly, we have time for reflection. Learning environments allow time for reflection about what the department is doing. As most of us know, working to deadlines and putting out day-to-day fires does not allow much time for thoughtful reflection and learning to take place.

The second building block is concrete learning processes and practices. A department or company has formal processes for generating, collecting, interpreting, and disseminating information and knowledge. This can include information gathered to keep track of competitor and technology trends, problem-solving analysis and interpretation, and education and training for employee development. In other words, learning is not chaos or hit-or-miss; it is a process in and of itself.

The final building block is leadership that reinforces learning. Again, like Sarder (2016), there is a focus on the importance of leadership supporting the learning culture. Organizational or department leaders model an interest in alternative viewpoints, communicate and support the importance of spending time on problem solving, knowledge transfer, and reflection on learning, and management actively questions and actively listens to their employees.

Garvin et al. (2008) have developed an assessment to help managers assess the learning culture in their organizations. The assessment measures each building block and its subcomponents separately allowing for detailed information to be gained regarding the current status of your learning culture. It will allow for identification of what you are doing well and where you can improve. The questionnaire is included below, but the assessment can be taken online (https://hbs.qualtrics.com/jfe/form/SV_ b7rYZGRxuMEyHRz?Q_JFE=qdg). Garvin et al. Learning Organization Survey BUILDING BLOCK 1 Supportive Learning Environment Psychological Safety

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In this unit, it is easy to speak up about what is on your mind.

If you make a mistake in this unit, it is often held against you.

People in this unit are usually comfortable talking about problems and disagreements.

People in this unit are eager to share information about what does and doesn’t work.

Keeping your cards close to your vest is the best way to get ahead in this unit.

Appreciation of DifferencesDifferences in opinion are welcome in this unit.

Unless an opinion is consistent with what most people in this unit believe, it won’t be valued.

This unit tends to handle differences of opinion privately or off-line, rather than addressing them directly with the group.

In this unit, people are open to alternative ways of getting work done.

Openness to New IdeasIn this unit, people value new ideas.

Unless an idea has been around for a long time, no one in this unit wants to hear it.

In this unit, people are interested in better ways of doing things.

In this unit, people often resist untried approaches.

Time for ReflectionPeople in this unit are overly stressed.

Despite the workload, people in this unit find time to review how the work is going.

In this unit, schedule pressure gets in the way of doing a good job.

In this unit, people are too busy to invest time in improvement.

There is simply no time for reflection in this unit.

BUILDING BLOCK 2

Concrete Learning Processes and Practices Experimentation

This unit experiments frequently with new ways of working.

This unit experiments frequently with new

product or service offerings.

This unit has a formal process for conducting and evaluating experiments or new ideas.

This unit frequently employs prototypes or simulations when trying out new ideas.

Information Collection

This unit systematically collects information on competitors.

This unit systematically collects information on economic and social trends.

This unit systematically collects information on customers.

This unit systematically collects information on technological trends.

This unit frequently compares its performance with that of competitors.

This unit frequently compares its performance with that of best-in-class organizations.

Analysis

This unit engages in productive conflict and debate during discussions.

This unit seeks out dissenting views during discussions.

This unit never revisits well-established perspectives during discussions.

This unit frequently identifies and discusses underlying assumptions that might affect key decisions.

This unit never pays attention to different views during discussions.

Education and Training

Newly hired employees in this unit receive adequate training.

Experienced employees in this unit receive periodic training and training updates.

Experienced employees in this unit receive training when switching to a new position.

Experienced employees in this unit receive training when new initiatives are launched.

In this unit, training is valued.

In this unit, time is made available for education and training activities.

Information Transfer

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This unit has forums for meeting with and learning from experts from other departments, teams, or divisions.

This unit has forums for meeting with and learning from experts from outside the organization.

This unit has forums for meeting with and learning from customers and clients.

This unit has forums for meeting with and learning from suppliers.

This unit regularly shares information with networks of experts within the organization.

This unit regularly shares information with networks of experts outside the organization.

This unit quickly and accurately communicates new knowledge to key decision makers.

This unit regularly conducts post-audits and after-action reviews.

BUILDING BLOCK 3 Leadership That Reinforces Learning

My managers invite input from others in discussions.

My managers acknowledge their own limitations with respect to knowledge, information, or expertise.

My managers ask probing questions.My managers listen attentively.My managers encourage multiple points of view.

My managers provide time, resources, and venues for identifying problems and organizational challenges.

My managers provide time, resources, and venues for reflecting and improving on past performance.

My managers criticize views different from their own point of view.

the workplace. Both have assessment tools that can help you identify where your department or organization is on the learning culture spectrum and where you can improve. I strongly suggest you do the assessments. Even more so, I encourage you to have others in your department take the assessment, as well. Should you decide to implement a learning culture, you will not be able to do it alone. You will need the help and support of your employees. Get them involved and one simple way to do it from the start is to have them participate and provide feedback in the assessment process.

References AICPA Private Company Practice Section (PCPS). (2015, June 9). AICPA Survey: Recruiting and Retaining Staff Emerge as Top Concerns for Most CPA Firms [Press release]. Retrieved from http:// www.aicpa.org/PRESS/PRESSRELEASES/2015/ Pages/AICPA-Survey-Recruiting-andRetaining- Staff-Emerge-as-Top-Concerns-for-Most-CPA- Firms.aspx

Blackwood, K. (2014). Benefits of creating an organizational learning culture. Business Vancouver. Retrieved from https://www. biv.com/article/2014/9/benefits-creatingorganizationallearning-culture/.

Gallup (2016). How Millennials want to work and live. Washington D. C.: Gallup.

Garvin, D. A., Edmondson, A. C., & Gino, F. (2008). Is yours a learning organization? Harvard Business Review, 86(3), 109-116.

Sarder, R. (2016). Building an innovative learning organization: A framework to build a smarter workforce, adapt to change, and drive growth. Hoboken, New Jersey: John Wiley & Sons, Inc.

Thomson Reuters (2017). Creating a learning vision for your firm. Toronto, Canada: Thomson Reuters.

Conclusion I have introduced you to the learning organization or the learning culture. It is clear that such an environment is important for many reasons including improved productivity and profits as well as increased employee attraction and retention, to name a few. I have identified two approaches to learning cultures that can be implemented in

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