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THE INFLUENCE OF A LEARNING CULTURE ON IT INVESTMENTS

plication is important” 0. Tracey, Tannenbaum and Kavanagh 0 highlighted four aspects of a continuous- learning culture. First, employees in a continuous-learning working environment view knowledge and skill acquisi- tion as their own responsibility. Second, there is a high degree of cooperation and cohesion among employees, managers, functional units and so on. Third, employees are provided opportunities for personal development in a continuous-learning environment. Fourth, there is a shared belief that innovation is valuable for staying competitive in market place.

Continuous-learning is valued by many organiza- tions. For example, in order to survive in the highly com- petitive telecommunication industry, Nokia places strong emphasis on “Invest in People” and thus focuses on con- tinuous-learning and developing people as human beings, not as organizational assets 0. Continuous-learning is also a central part of the culture in Nestle, the world’s largest food and beverage company. The company places impor- tance in employees’ professional development by encour- aging employees to work with people from different coun- tries and cultures and by providing chances to develop skills in different areas of the business 0.

Learning organizations acquire, store and re- trieve information quickly, test and improve their mental models and behavior routines and revise their organiza- tional memory regularly 0. As a result, these organizations have been shown to achieve superior overall firm per- formance [13] and are noted as being more successful at internal processes, such as acquiring and assimilating technology [2] [14]. Specifically, researchers have found that learning organizations are successful adopters of technology because they are better at observing, interpret- ing and integrating facts and then changing behavior 0. They also are proficient at sharing knowledge with ven- dors and utilizing stocks of knowledge and, thus, better able to overcome barriers when assimilating complex technologies 0. When making decisions about which tech- nologies to acquire, prior research has shown that organi- zations with a learning culture are more likely, in general, to pay attention to employee-related concerns 0. However, detailed analysis of what learning organizations have dis- covered and subsequently put into practice in their IT de- cision making process is lacking.

learning culture affects IT investment issues including change management, technical flexibility, whether func- tional managers are included in the IT decision process, and what technologies, specifically KM technologies in this case, are chosen. Supporting literature for each hy- pothesis is reviewed in the following sections.

Issues Considered

STS describes well functioning organizational systems to be those in which organizational decisions con- sider implications for both the social and technical inter- nal subsystems and also the requirements of the external environment 0. As shown in Figure 1, change manage- ment, which should consider both technical and social ramifications of new technology, is the first IT investment decision issue that we consider in more detail below. The second is technical flexibility, which relates to the capa- bilities of an organization in responding to external envi- ronmental change.

Change management is defined as making changes in a planned or systematic way. According to STS, change in the technical subsystem will have implica- tions in the social subsystem as well. However, in most organizations, information technology initiatives tend to be technology-led with little emphasis on the ramifications of changes to work processes, human resource practices or the social (human and organizational) aspects in general 0 0. Due to new technology implementation, some employ- ees may need to change their work process or update their job skills. As a result, they may resent or even resist the changes, which could lead to IT project failure. For ex- ample, when asked about why ERP implementation in Arkansas state government failed, Kelly Boyd, the gover- nor’s technology liaison, mentioned: “Training was not up to par and few people turned out…. Many folks simply did not want to make the change and don't care if it fails” 0.

We begin to fill this void by proposing the model derived from STS and organizational learning literature shown in Figure 1. We hypothesize that continuous-

Journal of Information Technology Management Volume XVI, Number 3, 2005

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