Perhaps there is an element of self-protection at work — the comfort of being able to hold someone else (namely, top management) responsible for the lack of effective leadership. There is no doubt that a CEO who is opposed to fundamental change can make life difficult for internal innovators, but this hardly proves that only the CEO can bring about significant change.

Two Views on Leadership

Let’s consider some different statements about leadership and change: “Little significant change can occur if it is driven from the top.” “CEO proclamations and programs rolled out from corporate headquarters are a good way to undermine deeper changes.” “Top-management ‘buy-in’ is a poor substitute for genuine commitment at many levels in an organization.”

These statements are supported by the experiences of two innovative leaders, Phil Carroll of Shell Oil and Rich Teerlink of Harley-Davidson.

Phil Carroll recalls, “When I first came in as CEO, everyone thought, ‘Phil will tell us what he wants us to do.’ But I didn’t have a clue, and if I had, it would have been a disaster.” Likewise, Rich Teerlink says, “Anyone who thinks the CEO can drive this kind of change is wrong.”

There are several reasons why leaders like Carroll and Teerlink have come to a more humble view of the power of top management. First is the cynicism that exists in most organizations after years of management fads. When the CEO preaches about “becoming a learning organization,” people roll their eyes and think to themselves, “Here we go again. I wonder what seminar s/he went to last weekend.” Most corporations have had so many “flavor-of-the-month” initiatives from management that people immediately discount any new pronouncement as more “executive cheer-leading” or, as they say at Harley-Davidson, “another fine program.”

A second reason has to do with the difference between compliance and commitment. Hierarchical authority is much more effective at securing compliance than it is in fostering genuine commitment. “It seemed that every year someone pressured us to change our promotion review process to incorporate our values,” reflects former Hanover Insurance CEO Bill O’Brien. “But we never caved in to this pressure. A value is only a value if it is voluntarily chosen. No reward system has ever been invented that people in an organization haven’t learned how to ‘game.’ We didn’t want just new behaviors. We wanted new behaviors for the right reasons” (“Moral Formation for Managers: Closing the Gap Between Intention and Practice,” in Character and the Corporation, MIT Center for Organizational Learning Research Monograph, 1994). There is simply no substitute for commitment in bringing about deep change. No one can force another person to learn, especially if that learning involves deep changes in beliefs and attitudes or fundamentally new ways of thinking and acting.

A third reason a different type of leadership is needed is that top-management initiatives often end up moving organizations backward, not forward. This can occur in obvious ways, such as top-management downsizings and reorganizations that have the side-effect of increasing internal competitiveness, which ends up undermining collaboration and, ultimately, economic performance. But it can also occur more subtly, even in changes explicitly designed to improve learning. For example, a mandated “360-degree feedback” process not only reinforces a compliance mentality, but it also lessens the likelihood of people surfacing what Harvard’s Chris Argyris calls the “potentially embarrassing information” that might “produce real change” (“Good Communication That Blocks Real Learning,” Harvard Business Review, July/August 1994). This kind of information will come into the open only when people have genuine trust, curiosity, and shared responsibility — conditions not usually fostered by mandated programs.

Even so, it must be acknowledged that many large-scale change programs — reorganizations, downsizing, corporate-wide cost reduction programs, or re-engineering programs — can be implemented only from top-management levels. But such changes will not affect the corporate culture if it is based on fear and defensiveness. Nor will they unleash people’s imagination and passions and enhance their ability to form genuinely shared visions. They will not change the quality of thinking in the organization, or increase intelligence at the front lines, where people con-front increasingly complex and dynamic business environments. And they will do nothing to foster the trust and skills needed by teams at all levels if they are to reflect on hidden assumptions and to inquire into the reasoning behind their own actions.

Types of Leadership

For the past 20 years, many colleagues and I have been working with managers and teams to develop enhanced learning capabilities that center around five related disciplines: systems thinking, surfacing and improving mental models, fostering dialogue, nurturing personal vision, and building shared visions. Four years ago, a group of us at MIT began to form a consortium of corporations with two main objectives: to advance the theory and method underlying this work; and to demonstrate what is possible when organizations begin working together toward integrating new learning capabilities into important work settings. The MIT Center for Organizational Learning currently involves about 20 corporations, mostly Fortune 100 firms.

Within these companies, we regularly confront the dilemmas posed by the conflicting views of leadership described above. Resolving these dilemmas requires fundamental shifts in our traditional thinking about leadership.

These shifts start with the simple view of leaders as those people who “walk ahead,” people who are genuinely committed to deep change in themselves and in their organizations and who demonstrate their commitment through their actions. They lead through developing new understandings, new skills, and new capabilities for individual and collective learning. And they come from many places within an organization.

In particular, we have identified three essential types of leaders in building learning organizations, roughly corresponding to three different organizational positions:

1. Local line leaders, who can undertake meaningful experiments to test whether new learning capabilities actually lead to improved business results.

2. Executive leaders, who provide support for line leaders, develop learning infrastructures, and lead by example in the gradual process of evolving the norms and behaviors of a learning culture.

3. Internal networkers, or community builders, who can move freely about the organization to find those who are predisposed to bringing about change, to help out in organizational experiments, and to aid in the diffusion of new learning.

Local Line Leaders

Nothing can start without committed local line leaders: individuals with significant business responsibility and “bottom-line” focus. They head organizational units that are microcosms of the larger organization, and yet have enough autonomy to be able to undertake meaningful change independent of the larger organization. To create useful experiments, they must confront the same issues and business challenges that are occurring within the larger organization. For example, a unique cross-functional task force may be less useful for a learning experiment than a team that manages a process that is ongoing, generic, and vital for future competitiveness, such as a product development team, a sales team, or a business division.

The key role played by local line leaders is to sanction significant practical experiments and to lead through active participation in those experiments. Without serious experiments aimed at connecting new learning capabilities to business results, there is no way to assess whether enhancing learning capabilities is just an intellectually appealing idea or if it can really make a difference. Typically, a Learning Center project will begin with a core team composed of line leaders who might initially work together for six to twelve months. During this time, they work on developing their own skills in systems thinking, collaborative inquiry, and building shared vision, and then begin applying those skills to their own issues. Only then will they be able to begin designing learning processes that might spread such skills throughout their organization and become embedded in how work is done.

For example, a team of sales managers and sales representatives at Federal Express worked together for over a year before they began to develop what eventually became the Global Customer Learning Laboratory “We felt we needed new tools for working with our key corporate customers as learning partners,” says Cathy Stopcynski of Federal Express. “That’s why the Global Customer Learning Laboratory is important. It gives us a whole new way to work together with customers to improve our collective thinking and come up with completely new solutions to complex logistics problems. “At Electronic Data Systems (EDS), a growing network of local line leaders is bringing learning organization principles and methods into work with customers through EDS’s “Leading Learning Communities” program.

Most corporations have had so many “flavor-of-the-month” initiatives from management that people immediately discount any new pronouncement as more “executive cheerleading” or, as they say at Harley-Davidson, “another fine program.”

In addition to playing a key role in the design and implementation of new learning processes, local line leaders often become teachers once these learning processes become established. In fact, the most effective facilitators in learning processes such as the Global Customer Learning Laboratory are usually not professional trainers but the line managers themselves. Their substantive knowledge and practical experience give them unique credibility. Facilitating others’ learning also becomes a powerful, ongoing way for line leaders to deepen their own understanding and capabilities.

However, engaging local line leaders may be difficult. As pragmatists, they often find ideas like systems thinking, mental models, and dialogue intangible and “hard to get their hands around.” “When I was first exposed to the MIT work,” says Fred Simon, former head of the Lincoln Continental program at Ford Motor Company, “I was highly skeptical. I had heard so many ‘academic’ theories that made sense but never produced for us. But I was also not happy with our team’s ability to work together. I knew there must be a better way, and my business planning manager was convinced this could make a difference’

Simon’s view is typical of many line leaders at the outset: he was skeptical, but he recognized that he had problems that he could not solve. He also had a trusted colleague who was willing to engage with him. Again and again, we have found that healthy, open-minded skeptics can become the most effective leaders and, eventually, champions of this work. They keep the horse in front of the cart by focusing first and foremost on business results. Such people invariably have more staying power than the “fans” who get excited about new ideas but whose excitement wanes once the newness wears off.

Because line leaders are focused primarily on their business unit, however, they may not think much about learning within the larger organization, and typically they have little time to devote to diffusion of their efforts. They may also be unaware of—and relatively inept at dealing with—the anti-learning forces in the larger organization. They become impatient when the larger organization does not change to match their new ideas, and may start to feel misunderstood and unappreciated. They can easily develop an “us against the world” mentality, which will make them especially ineffective in communicating their ideas to others.

Innovative local line managers are often more at risk than they realize. They typically believe, “My bosses will leave me alone as long as I produce results, regardless of the methods I use.” But the “better mousetrap” theory may not apply in large institutions. Improved results are often threatening to others, and the more dramatic the improvement, the greater the threat. Large organizations have complex forces that maintain the status quo and inhibit the spread of new ideas. Often, even the most effective local line leaders fail to understand these forces or know how to work with them.

Despite these limitations, committed local line leadership is essential. At least half of the Learning Center companies that have made significant strides in improving business results and developing internal learning capabilities have had little or no executive leadership. But we have seen no examples where significant progress has been made in an organization without leadership from local line managers, and many examples where sincerely committed CEOs have failed to generate any significant momentum.

Executive Leaders

At the Learning Center, our excitement around the practical experiments led by local line managers has frequently made us blind to the necessary and complementary roles played by executive leaders. Local line leaders can benefit significantly from “executive champions” who can be protectors, mentors, and thinking partners. When dramatic improvements achieved in one line organization threaten others, executive partners can help manage the threat. Alternatively, executive partners can make sure that new innovative practices are not ignored because people are too busy to take the time to understand what the innovators are doing. By working in concert with internal networkers, executives can help connect innovative local line leaders with other like-minded people. They also play a mentoring role in helping the local line leaders understand complex political cross-currents and communicate their ideas and accomplishments to those who have not been involved.

In one company, a local line organization had achieved what it regarded as dramatic improvements in the product development process, but its efforts lacked credibility when judged by more traditional metrics. For instance, at critical checkpoints the team had record numbers of engineering change orders. The team interpreted this as evidence that people were more willing to surface and fix problems early in the development process. But outside the team, these same orders were seen as evidence that the group was “out of control:’

Eventually, executives in the company commissioned an independent audit, which showed that the team was indeed highly effective. The executives also supported the development of a “learning history” to help others understand how the team had accomplished its results.

But the “better mousetrap” theory may not apply in large institutions. Improved results are often threatening to others, and the more dramatic the improvement, the greater the threat.

Part of our difficulty with appreciating the role that effective executive leadership can play in learning is that all of us are used to the “captain of the ship” image of traditional hierarchical leaders. However, when executives act as teachers, stewards, and designers, they fill roles that are much more subtle, contextual, and long term than the traditional model of the power-wielding hierarchical leader.

“We in top management are responsible for creating an operating environment that can allow continual learning,” says Harley-Davidson’s Teerlink. Although executive leadership has traditionally focused on structure and strategy, Teerlink and other executives are increasingly thinking about the operating environment in less tangible ways.

Effective executive leaders can build an environment that is conducive to learning in several ways. The first is by articulating guiding ideas. “I have always believed that good ideas will drive out bad ideas,” says Hanover’s O’Brien. “One of the basic problems with business today is that our organizations are guided by too many mediocre ideas — ideas which do not foster aspirations worthy of people’s commitment.” Guiding ideas are different from slogans or management buzzwords. They are developed gradually, often over many years, through reflection on an organization’s history and traditions and on its long-term growth and opportunities.

A second way to build operating environments for learning is through conscious attention to learning infrastructure. In a world of rapid change and increasing interdependence, learning is too important to be left to chance. “We have plenty of infrastructure for decision making within AT&T,” says Chairman Bob Allen. “What we lack is infrastructure for learning” (Peter M. Senge, et al., The Fifth Discipline Field-hook, 1994, p. 34).

I have met many CEOs in recent years who have lamented that “we can’t learn from ourselves” or “we are better at learning from competitors than from our own people.” But with little or no infrastructure to support ongoing learning, one might ask, “Why should successful new practices spread in organizations?” Who studies these innovations to document why they worked? Where are the learning processes that will enable others to follow in the footsteps of successful innovators? Who is responsible for creating these learning processes?

There can be little doubt of the long-term business impact of executive leadership in developing learning infrastructure. When the Royal Dutch/Shell Group’s central group planning leaders became convinced that “scenario thinking” was a vital survival skill in turbulent, unpredictable world oil markets, they didn’t initiate a set of scenario-planning courses for Shell’s management. Instead, they redesigned the planning infrastructure so that management teams regularly were asked not just for their budget and their “plan,” but for several plans describing how they would manage under multiple possible futures. “Planning as learning” has gradually become a way of life within Shell — a change to which many attribute Shell’s rise to preeminence in the world oil business.

A third way to build operating environments for learning lies within the executive’s own domain for taking action — namely, the executive team itself. It is important that executives recognize that they, too, must change, and that many of the skills that have made them successful in the past can actually inhibit learning.

I think these ideas will eventually lead to a very different mindset and, ultimately, a different skill-set among executives. “Gradually, I have come to see a whole new model for my role as a CEO,” says Shell Oil’s Carroll. “Perhaps my real job is to be the ecologist for the organization. We must learn how to see the company as a living system and to see it as a system within the context of the larger systems of which it is a part. Only then will our vision reliably include return for our shareholders, a productive environment for our employees, and a social vision for the company as a whole.”

Internal Networkers

The most unappreciated leadership role is that of the internal networkers, or what we often call internal community builders. Internal networkers are effective for the very reasons that top-management efforts to initiate change can backfire — oftentimes, no power is power. Precisely because they have no positional authority, internal networkers are free to move about a large organization relatively unnoticed.

When the CEO visits someone, everyone knows. When the CEO says, “We need to become a learning organization,” everyone nods. But when someone with little or no positional authority begins asking which people are genuinely interested in changing the way they and their teams work, the only ones likely to respond are those who are genuinely interested. And if the internal networker finds one person who is interested and asks, “Who else do you think really cares about these things?” he or she is likely to receive an honest response. The only authority possessed by internal networkers comes from the strength of their convictions and the clarity of their ideas.

It is very difficult to identify the internal networkers because they can be people in many different organizational positions. They might be internal consultants, trainers, or personnel staff in organization development or human resources. They might be front-line workers like engineers, sales representatives, or shop stewards. They might, under some circumstances, be in senior staff positions. What is important is that they are able to move around the organization freely, with high accessibility to many parts of the organization. They understand the informal networks through which information and stories flow and how innovative practices naturally diffuse within organizations.

Internal networkers are effective for the very reasons that top-management efforts to initiate change can backfire—oftentimes, no power is power….The only authority possessed by internal networkers comes from the strength of their convictions and the clarity of their ideas.

The first vital function played by internal networkers is to identify local line managers who have the power to take action and who are predisposed to developing new learning capabilities. Much time and energy can be wasted by working with the wrong people, especially in the early stages of a change process. Convincing people that they should be interested in systems thinking or learning is inherently a low-leverage strategy. Even if they are persuaded initially, they are unlikely to persevere.

When the Liaison Officers from the Learning Center companies were asked how they each got started in this work, they responded, virtually unanimously, that they were “predisposed.” All of them had something in their backgrounds — perhaps an especially influential college course, a particular work experience, or just lifelong interest — that made them more open to the systems perspective. They each had a deep curiosity about learning, or mental models, or the mystery of profound teamwork. In turn, they felt attuned to others they met who shared this predisposition.

In ongoing experiments within line organizations, we have found that internal networkers can help in many ways. In our own Learning Center projects, they serve as project managers, as co-facilitators, or as “learning historians” — people trained to track a major change process and to help those who are involved to better reflect on what they are learning (see “Learning Histories: ‘Assessing’ the Learning Organization,” May 1995). As practical knowledge is built, internal networkers continue to serve as organizational “seed carriers,” connecting like-minded people from diverse settings and making them aware of each other’s learning efforts. Gradually, they may help in developing the more formal coordination and steering mechanisms needed to move from local experiments to broader, organization-wide learning. At Ford, for example, an informal “Leaders of Learning” group was formed by local line leaders and internal networkers who wanted to share leanings and serve as a strategic leadership body. They saw their work as supporting continuing experiments, connecting those experiments with the interests of top management, and wrestling with organization-wide capacity building and learning.

As with local line managers and executive leaders, the limitations of internal networkers are likewise counterparts to their strengths. Because they do not have a great deal of formal authority, they can do little to counter hierarchical authority directly. If a local line leader becomes a threat to peers or supervisors, they may be powerless to help him or her. Internal networkers have no authority to institute changes in organizational structures or processes. So, even though they are essential, internal networkers are most effective when working in concert with local line leaders and executive leaders.

The Leadership Challenges

The leadership challenges inherent in building learning organizations are a microcosm of the leadership issue of our times: how human communities can productively confront complex issues where hierarchical authority is inadequate to bring about change. None of today’s most pressing issues — deterioration of the natural environment, the international arms race, erosion of the public education system, or the breakdown of the family and increasing social fragmentation — will be resolved through hierarchical authority.

In all these issues, there are no single causes, no simple “fixes” There is no one villain to blame. There will be no magic pill. Significant change will require imagination, perseverance, dialogue, deep caring, and a willingness to change on the part of millions of people. I believe these same challenges exist in the work of building learning organizations.

Recently, a group of CEOs from the Learning Center companies spent a half-day with Karl-Henrik Rob rt, the founder of Sweden’s path-breaking Natural Step process for helping societies become ecologically sustainable. The next day, Rich Teerlink of Harley-Davidson came in and said, “I don’t know why I stay awake at night trying to figure out how to transform a six-thousand person company. Yesterday, we talked with someone who is transforming a country of four million people.”

The necessity of creating systemic change where hierarchy is inadequate will, I believe, push us to new views of leadership based on new principles. These challenges cannot be met by isolated heroic leaders. They will require a unique mix of different people, in different positions, who lead in different ways. Although the picture sketched above is tentative and will certainly evolve over time, I doubt that it understates the changes that will be required in our traditional leadership models.

This article is an edited version of P Senge, “Leading Learning Organizations” (Cambridge, MA: MIT Center for Organizational Learning Research Monograph, 1995). Copyright © 1995 by Peter M. Senge. It has also appeared in the Peter F Drucker Foundation book The Leader of the Future, M Goldsmith, F Hesselbein, and R. Beckhard, eds. (San Francisco: Jossey-Bass, 1995).

Peter M. Senge is director of the Center for Organizational Learning at MIT’s Sloan School of Management. He is the author of The Fifth Discipline: The Art and Practice of the Learning Organization and co-author of The Fifth Discipline Fieldbook: Strategies and Tools for Building a Learning Organization.

Edited by Colleen P Lannon. Illustrations by Nancy Margulies of Mindscapes (St Louis, MO).

The post Rethinking Leadership in the Learning Organization appeared first on The Systems Thinker.

You are an engineer working on two projects within your business unit. These are demanding projects, and you give them your best. You respect your teammates and are accountable to your project managers. But when you face a problem that stretches your knowledge, you turn to people like Jake, Sylvia, and Robert. Even though they work on their own projects in other business units, they are your real colleagues. You all go back many years. They understand the issues you face and will explore new ideas with you. And even Julie, who now works for one of your suppliers, is only a phone call away. These are the people with whom you can discuss the latest developments in the field and troubleshoot each other’s most difficult design challenges. If only you had more time for these kinds of interactions.

You are a CEO and, of course, you are responsible for the company as a whole. You take care of the “big picture.” But you have to admit that for you, too, the company is mostly an abstraction: names, numbers, processes, strategies, markets, spread-sheets. Sure, you occasionally take tours of the facilities, but on a day-to-day basis, you live among your peers — your direct reports with whom you interact in running the company, some board members, and other executives with whom you play golf and discuss a variety of issues.

We frequently say that people are an organization’s most important resource. Yet we seldom understand this truism in terms of the communities through which individuals develop and share the capacity to create and use knowledge. Even when people work for large organizations, they learn through their participation in more specific communities made up of people with whom they interact on a regular basis. These “communities of practice” are mostly informal and distinct from organizational units (see “Communities of Practice” on p. 1).

Although we recognize knowledge as a key source of competitive advantage in the business world, we still have little understanding of how to create and leverage it in practice. Traditional knowledge management approaches attempt to capture existing knowledge within formal systems, such as databases. Yet systematically addressing the kind of dynamic “knowing” that makes a difference in practice requires the participation of people who are fully engaged in the process of creating, refining, communicating, and using knowledge. Thus, communities of practice are a company’s most versatile and dynamic knowledge resource and form the basis of an organization’s ability to know and learn.

Defining Communities of Practice

Communities of practice are everywhere. We all belong to a number of them — at work, at school, at home, in our hobbies. Some have a name; some don’t. We are core members of some, and belong to others more peripherally. You may be a member of a band, or you may just come to rehearsals to hang around with the group. You may lead a group of consultants who specialize in telecommunication strategies, or you may only stay in touch to keep informed about developments in the field. Or you may have just joined a community and are still trying to find your place in it. Whatever form our participation takes, most of us are familiar with the experience of belonging to a community of practice.

Members of a community are informally bound by what they do together — from participating in lunch-time discussions to solving difficult problems—and by what they have learned through their mutual engagement in these activities. A community of practice is thus different from a community of interest or a geographical community, neither of which implies a shared practice. A community of practice defines itself along three dimensions:

• What it is about: its joint enterprise as understood and continually renegotiated by its members
• How it functions: the relationships of mutual engagement that bind members together into a social entity
• What capability it has produced: the shared repertoire of communal resources (routines, sensibilities, artifacts, vocabulary, styles, etc.) that members have developed over time.

Communities of practice also move through various stages of development characterized by different levels of interaction among the members and different kinds of activities (see “Stages of Development” on p. 3).

Communities of practice develop around things that matter to people. As a result, their practices reflect the members’ own understanding of what is important. Even when a community’s actions conform to an external mandate, it is the community — not the mandate — that produces the practice. In this sense, communities of practice are self-organizing systems.

Communities of Practice in Organizations

Communities of practice exist in any organization. They can be found:

• Within businesses: Communities of practice arise as people address recurring sets of problems together. So, claims processors within an office form communities of practice to deal with the constant flow of information they need to process. By participating in such a communal memory, they can do the job without having to remember everything themselves.
• Across business units: Important knowledge is often distributed in different business units. People who work in cross-functional teams thus form communities of practice to keep in touch with their peers in various parts of the company and maintain their expertise. When communities of practice cut across business units, they can develop strategic perspectives that transcend individual product lines. For instance, a community of practice may propose a plan for equipment purchases that no one business unit could have come up with on its own
• Across company boundaries: In some cases, communities of practice become useful by crossing organizational boundaries. For instance, in fast-moving industries, engineers who work for suppliers and buyers alike may form a community of practice to keep up with constant technological changes.Communities of practice are not a new kind of organizational unit; rather, they are a different cut on the organization’s structure — one that emphasizes the learning that people have done together rather than the unit they report to, the project they are working on, or the people they know. Communities of practice differ from other kinds of groups found in organizations in the way they define their enterprise, exist over time, and set their boundaries:
• A community of practice is different from a business or functional unit in that it defines itself in the doing, as members develop among themselves their own understanding of what their practice is about. This living process results in a much richer definition than a mere institutional charter. As a consequence, the boundaries of a community of practice are more flexible than those of an organizational unit. The membership involves whoever participates in and contributes to the practice. People can participate in different ways and to different degrees. This permeable periphery creates many opportunities for learning, as outsiders and newcomers learn the practice in concrete terms, and as core members gain new insights from contacts with less-engaged participants.
• A community of practice is different from a team in that the shared learning and interest of its members are what keep it together. It is defined by knowledge rather than by task, and it exists because participation has value to its members. It does not appear the minute a project is started and does not disappear with the end of a task. It takes a while to come into being and may live long after a project is completed or an official team has disbanded.
• A community of practice is different from a network in the sense that it is “about” something; it is not just a set of relationships. It has an identity as a community, and thus shapes the identities of its members. A community of practice exists because it produces a shared practice as members engage in a collective process of learning.People belong to communities of practice at the same time as they belong to other organizational structures. In their business units, they shape the organization. In their teams, they take care of projects. In their networks, they form relationships. And in their communities of practice, they develop the knowledge that lets them do these other tasks. This informal fabric of communities and shared practices makes the official organization effective and, indeed, possible.

  Communities of practice have different relationships with the official organization. The table “Community’s Relationship to Official Organization” on p. 4 shows different degrees of institutional involvement, but it does not imply that some relationships are better or more advanced than others. Rather, these distinctions are useful because they draw attention to the issues that can arise in the interaction between the community of practice and the organization as a whole.

The Importance to Organizations

Communities of practice are important to the functioning of any organization, but they become crucial to those that recognize knowledge as a key asset. From this perspective, an effective organization comprises a constellation of interconnected communities of practice, each dealing with specific aspects of the company’s competencies — from the peculiarities of a long-standing client, to manufacturing safety, to technical inventions. Knowledge is created, shared, organized, revised, and passed on within and among these communities. In a deep sense, it is by these communities that knowledge is “owned” in practice.

Communities of practice fulfill a number of functions with respect to the creation, accumulation, and diffusion of knowledge in an organization:

• They are nodes for the exchange and interpretation of information. Because members have a shared understanding, they know what is relevant to communicate and how to present information in useful ways. As a consequence, a community of practice that spreads throughout an organization is an ideal channel for moving information — such as best practices, tips, or feedback across organizational boundaries.
• They can retain knowledge in “living” ways, unlike a database or a manual. Even when they routinize certain tasks and processes, they can do so in a manner that responds to local circumstances and thus is useful to practitioners. Communities of practice preserve the tacit aspects of knowledge that formal systems cannot capture. For this reason, they are ideal for initiating newcomers into a practice.
• They can steward competencies to keep the organization at the cutting edge. Members of these groups discuss novel ideas, work together on problems, and keep up with developments inside and outside a firm. When a community commits to being on the forefront of a field, members distribute responsibility for keeping up with or pushing new developments. This collaborative inquiry makes membership valuable, because people invest their professional identities in being part of a dynamic, forward-looking community
• They provide homes for identities. They are not as temporary as teams, and unlike business units, they are organized around what matters to their members. Identity is important because, in a sea of information, it helps us sort out what we pay attention to, what we participate in, and what we stay away from. Having a sense of identity is a crucial aspect of learning in organizations. Consider the annual “computer drop” at a semiconductor company that designs both analog and digital circuits. The computer drop became a ritual by which the analog community asserted its identity. Once a year, their hero would climb the highest building on the company’s campus and drop a computer, to the great satisfaction of his peers in the analog gang. The corporate world is full of these displays of identity, which manifest themselves in the jargon people use, the clothes they wear, and the remarks they make. If companies want to benefit from people’s creativity, they must support communities as a way to help them develop their identities.Communities of practice structure an organization’s learning potential in two ways: through the knowledge they develop at their core and through interactions at their boundaries. Like any asset, these communities can become liabilities if their own expertise becomes insular. It is therefore important to make sure that there is enough activity at their boundaries to renew learning. For while the core is the center of expertise, radically new insights often arise at the boundary. Communities of practice truly become organizational assets when their core and their boundaries are active in complementary ways. To develop the capacity to create and retain knowledge, organizations need to build institutional and technological infrastructures that do not dismiss or impede these communities, but rather recognize, support, and leverage them.

STAGES OF DEVELOPMENT

Communities of practice move through various stages of development characterized by different levels of interaction among the members and different kinds of activities.

Developing and Nurturing Communities of Practice

Just because communities of practice arise naturally does not mean that organizations can’t do anything to influence their development. Most communities of practice exist whether or not the organization recognizes them. Many are best left alone — some might actually wither under the institutional spotlight. And some may need to be carefully seeded and nurtured. But a good number will benefit from some attention, as long as this attention does not smother their self-organizing drive.

Whether these communities arise spontaneously or come together through seeding and nurturing, their development ultimately depends on internal leadership. Certainly, in order to legitimize the community as a place for sharing and creating knowledge, recognized experts need to be involved in some way, even if they don’t do much of the work. But internal leadership can take many forms:

• The inspirational leadership provided by thought leaders and recognized experts
• The day-to-day leadership provided by those who organize activities
• The classificatory leadership provided by those who collect and organize information in order to document practices
• The interpersonal leadership provided by those who weave the social fabric
• The boundary leadership provided by those who connect the community to other communities
• The institutional leadership provided by those who maintain links with other organizational constituencies, in particular the official hierarchy
• The cutting-edge leadership provided by those who lead “out-of-the-box” initiatives

These roles may be formal or informal, and may be concentrated in a core group or more widely distributed. But in all cases, leadership must have intrinsic legitimacy in the community. To be effective, therefore, managers and others must work with communities of practice from the inside rather than merely attempt to design them or manipulate them from the outside. Nurturing communities of practice in organizations includes:

Legitimizing Participation. Organizations can support communities of practice by recognizing the work of sustaining them; by giving members the time to participate in activities; and by creating an environment in which the value they bring is acknowledged. To this end, it is important to have an institutional discourse that includes this dimension of organizational life. Merely introducing the term “communities of practice” into an organization’s vocabulary can have a positive effect by giving people an opportunity to talk about how their participation in these groups contributes to the organization as a whole.

Negotiating Their Strategic Context.In what Richard McDermott calls “double-knit organizations,” people work in teams for projects but belong to longer-lived communities of practice for maintaining their expertise. The value of team-based projects that deliver tangible products is easily recognized, but it is also easy to overlook the potential cost of their short-term focus. The learning that communities of practice share is just as critical, but its longer-term value is more subtle to appreciate. Organizations must therefore develop a clear sense of how knowledge is linked to business strategies and use this understanding to help communities of practice articulate their strategic value. This involves a process of negotiation that goes both ways. It includes understanding what knowledge — and therefore what practices — a given strategy requires. Conversely, it also includes paying attention to what emergent communities of practice indicate with regard to potential strategic directions.

Being Attuned to Real Practices. To be successful, organizations must leverage existing practices. For instance, when the customer service function of a large corporation decided to combine service, sales, and repairs under the same 800 number, researchers from the Institute for Research on Learning discovered that people were already learning from each other on the job while answering phone calls. IRL then instituted a learning strategy for combining the three functions that took advantage of this existing practice. By leveraging what they were already doing, workers achieved competency in the three areas much faster than they would have through traditional training. More generally, the knowledge that companies need is usually already present in some form, and the best place to start is to foster the formation of communities of practice that leverage the potential that already exists.

Fine-tuning the Organization. Many elements in an organizational environment can foster or inhibit communities of practice, including management interest, reward systems, work processes, corporate culture, and company policies. These factors rarely determine whether people form communities of practice, but they can facilitate or hinder participation. For example, issues of compensation and recognition often come up. Because communities of practice must be self-organizing to learn effectively and because participation must be intrinsically self-sustaining, it is tricky to use reward systems as a way to manipulate behavior in or micro-manage the community. But organizations shouldn’t ignore the issue of reward and recognition altogether. Rather, they need to adapt reward systems to support participation in learning communities; for instance, by including community activities and leadership in performance review discussions. Managers also need to make sure that existing compensation systems do not inadvertently penalize the work involved in building communities.

Providing Support.resources, such as outside experts, travel, meeting facilities, and communications technology. A company-wide team assigned to nurture community development can help address these needs. This team typically Communities of practice are mostly self-sufficient, but they can benefit from some

• provides guidance and resources
• helps communities connect their agenda to business strategies
• encourages them to move forward and remain focused on the cutting edge
• ensures they include all the right people
• helps them link to other communities

Such a team can also help identify and eliminate barriers to participation in the structure or culture of the overall organization; for instance, conflicts between short-term demands on people’s time and the need to participate in learning communities. In addition, just the existence of such a team sends the message that the organization values the work and initiative of communities of practice.

The Art of Balancing Design and Emergence

Communities of practice do not usually require heavy institutional infrastructures, but their members do need time and space to collaborate. These communities do not require much management, but they can use leadership. They self-organize, but they flourish when their learning fits with their organizational environment. The art is to help such communities find resources and connections without overwhelming them with organizational meddling. This need for balance reflects the following paradox: No community can fully design the learning of another; but conversely, no community can fully design its own learning.

Acknowledgments:This article reflects ideas and text co-created for presentations with my colleagues Richard McDermott of McDermott & Co., George Por of the Community Intelligence Labs, Bill Snyder of the Social Capital Group, and Susan Stucky of the Institute for Research on Learning. Thanks to all of them for their personal and intellectual companionship.

Etienne Wenger, PhD, is a globally recognized thought leader in the field of learning theory and its application to business. A pioneer of the “community of practice” research and author of Communities of Practice: Learning, Meaning, and Identity (Cambridge University Press, 1998), he helps organizations apply these ideas through consulting, workshops, and public speaking.

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