A learning organization is a company which can learn faster than its rivals and anticipate changes. These companies encourage continuous learning and knowledge generation at all levels. They facilitate the exchange of information within the company. According to Peter Senge, author of a book about this concept, abilities in five areas are necessary to move a company along this path.

1. Systems thinking. This involves looking at the whole system, rather than a single part, and become aware of the interrelation-ships among subparts. You have to be able to perceive patterns and change over time.

2. Personal style. You must be able to use intuitive thinking. And you must be able to initiate change rather than just react to crisis. Don’t expect to be able to empower people before they’re ready.

3. Mental models. Be aware of your sometimes unconscious assumptions about the business, the market, the competitors, and so forth. Challenge implicit assumptions and analyze them rationally.

4. Shared vision. People within an organization must sincerely believe in a shared vision. Thus, it cannot be forced on them from the top. They must be led to it.

5. Team Learning. Don’t let a team be dragged to half the average IQ by defensiveness.

“American business overlooks the power of fun in relation to productivity…it is just another example of how the embalming fluid has soaked into the fabric of most businesses. Fun is discouraged. The implication is that if fun is allowed, work becomes secondary. I challenge that, I know better. Fun and effort are related, success in an open company comes naturally.”–from Hal Klopp, The Adventure of Leadership.

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