Learning organization and firm performance

Purpose: The purpose of this paper is to identify organizational resources that may enhance the performance outcomes of a learning culture; this study was undertaken in the United Arab Emirates (UAE), an emerging economy in the Arabian Gulf region. Design/methodology/approach: A survey questionnaire was used to collect data on a sample of 254 firms from the Emirates of Dubai and Abu Dhabi. The target respondents included middle to senior managers working in logistics, operations, finance and general management positions. Findings: The data revealed a positive relationship between learning organization (LO) initiatives and four measures of firm performance considered in the study: employee skills development, product/service innovation, cost-effectiveness and growth in revenues. This relationship was moderated by strategic orientation of the human resource management function and perceived organizational support. Effective HRM strategies and organizational support systems were identified as critical resources that can add substantial value to the performance outcomes of an LO culture. These findings suggest that investing in the development of an LO culture makes a good business sense. Research limitations/implications: Use of perceptual measures was one of the major limitations of the present study. Practical implications: The largely positive impact of LO-related programs underscores the strategic importance of the LO concept to maintain superior performance outcomes in the emerging knowledge economy of UAE. Originality/value: The paper represents an initial effort at making a business case for the LO concept in a non-western context. It brings into focus the role of organizational support and strategically oriented human resource management initiatives in optimizing the performance impact an LO culture.