Inter‐Organizational Learning in Supply Chains: A Focus on Logistics Service Providers and Their Customers

• Author: Ayman Omar,Ila Manuj,Terrance L. Pohlen
• DOI: http://doi.org/10.1111/jbl.12044
• Date: 01 June 2014
• Published date: 01 June 2014

Inter-Organizational Learning in Supply Chains: A Focus on

Logistics Service Providers and Their Customers

Ila Manuj

1

, Ayman Omar

2

, and Terrance L. Pohlen

1

1

University of North Texas

2

American University

The learning process between supply chain entities is explored from the perspective of senior third-party executives. Through grounded the-

ory, a theoretical framework emerged that extends our understanding of learning within a supply chain by identifying the major constructs

and learning stages comprising the basic social process of inter-organizational learning. This framework provides significant insights into the

complex process employed in a supply chain to share, disseminate, and store information; co-create knowledge; and to derive a competitive

advantage.

Keywords: inter-organizational learning; grounded theory; supply chain; knowledge co-creation

INTRODUCTION

Learning across organizations, or inter-organizational learning

(IOL), leads to new insights and understandings that jointly

emerge through the collaborative sharing of information and

knowledge between multiple entities in a supply chain (Flint

et al. 2005). Learning may occur with customers, distributors,

suppliers, alliance partners, and even competitors (Nonaka 1994).

IOL enables supply chain executives to jointly learn how to

combine capabilities and processes to achieve a competitive

advantage by continually creating value for the end customer.

Executives can use this knowledge to more effectively anticipate

and respond to their customers’needs while strengthening col-

laborative relationships within the supply chain (Johnson and

Sohi 1997; Simonin 1997; Yazdanparast et al. 2010; Mohr and

Sengupta 2002).

IOL is a complex social phenomenon involving dynamic

behavioral interpretations and processing of events, decisions,

and contexts; these interpretations are difficult to capture with-

out an understanding of the mindsets of executives going

through the learning process (Balogun and Johnson 2004; Furst

and Cable 2008; Huxham and Hibbert 2008; Omar et al. 2012).

Learning takes place through multiple components such as

gathering, processing, and disseminating knowledge and infor-

mation. It also involves developing a shared interpretation

and storage of this knowledge in the organization’s memory

(Sinkula 1994; Slater and Narver 1995). IOL is not a static

process; it continuously evolves based on different interpreta-

tions and experiences.

These learning components and experiences are not clearly

understood in terms of how they are perceived and interpreted

by senior executives. In particular, these elements are essential

for third-party logistics (3PL) providers as they continuously

seek to develop new and innovative solutions, and to integrate

and adapt their business processes with their customers and other

trading partners (Phene and Almeida 2008; Lederman 2010).

This research attempts to increase our understanding of IOL and

executives perceptions of the learning process by addressing the

question: How do the senior executives of 3PL providers per-

ceive and interpret the IOL occurring with their customers in

terms of the process, its elements, associated experiences, and

outcomes? To address this research question, three major goals

were formulated to advance our understanding of IOL:

1. The main goal of this research is to expand the theoretical

understanding of executives’perception and interpretation of

IOL by uncovering the major IOL constructs and examining

the complexity of this social process.

2. The second goal of this research is to shed more light on IOL

by examining it from an interpretivist lens, which argues that

knowledge is not discovered rather constructed through social

interactions.

3. The third goal of this research is to uncover how IOL could

lead to a competitive advantage for 3PL firms and their cus-

tomers.

INTER-ORGANIZATIONAL LEARNING

The investigation into the learning process has its foundations in

the knowledge-based and resource-based views of the firm which

consider knowledge to be the most strategically important

resource and the fundamental basis for competition (Grant 1996).

The ability of a firm to learn to effectively combine resources

into capabilities that are not easily duplicated is a potential

source of competitive advantage. Other than being a capability in

itself, learning enables other capabilities such as collaboration

(Sinkovics and Roath 2004), agility (Bowersox et al. 1995;

Christopher 2000), flexibility (Fawcett et al. 1996; Morash and

Clinton 1997), and information focus (Zhao et al. 2001).

Corresponding author:

Ila Manuj, Department of Marketing & Logistics, College of Busi-

ness Administration, University of North Texas, 1155 Union Circle,

Denton, TX 76201, USA; E-mail: ila.manuj@unt.edu

Note: All authors contributed equally to the manuscript. The authors

are listed in the alphabetical order of their last names.

Journal of Business Logistics, 2014, 35(2): 103–120

© Council of Supply Chain Management Professionals

The learning literature has evolved to encompass four levels

(Beesley 2004). Initial research focused on how organizations

acquired knowledge through internal social actors, namely the

individual, group, and organizational (OL) levels of learning

(Crossan et al. 1999). Driven by the need to understand how

learning takes place within large, complex networks and supply

chains (Flint et al. 2005; Samuel et al. 2011; Berghman et al.

2012), the research recognized a fourth level, IOL (Lampela

2009). IOL can be defined as a complex social process whereby

firms learn from each other or learn with each other (Knoppen

et al. 2010) to co-create new knowledge.

Larsson et al. (1998) made the distinction between OL and

IOL by including the learning synergy or interaction effect

between organizations that would not have occurred if there had

not been any interfirm interaction. On similar lines, Jones and

Macpherson (2006) extend Crossan et al.’s (1999) OL process

framework to include IOL as a fourth level of learning. They

argue that external organizations have a significant role to play

in the processes by which new knowledge and procedures

become imbedded in the participating firms. Inter-organizational

collaboration in the learning process is now commonly viewed

as essential for effective performance (Provan and Milward

1995; Knight 2002).

The exploration of IOL has evolved from how firms learn from

each other to how firms co-create knowledge. Initial research

emphasized the transfer and appropriation of knowledge from one

firm to another (Levitt and March 1988; Hamel 1991; Huber

1996). This perspective was largely based on research in interna-

tional joint ventures where companies often were engaged in

knowledge acquisition for the parent organization (Hamel 1991;

Levinson and Asahi 1995; Huber 1996; Inkpen 2000; Lane et al.

2001). The emphasis of this initial research stream was to extend

the OL constructs into an IOL context and to investigate the pro-

cesses that firms employ to learn from each other (Holmqvist

2003a,b; Janowicz-Panjaitan and Noorderhaven 2008; Cheung

et al. 2010; Hern

andez-Espallardo et al. 2010; Cheng 2012).

More recent research has explored how firms collaborate and

learn together (Flint et al. 2005; Lai et al. 2009; Chang and Got-

cher 2010; Westerlund and Rajala 2010; Berghman et al. 2012;

Otto 2012). IOL within this stream of research includes learning

about partners, as well as partnering, which allows firms to

respond more efficiently to each other’s and market demands.

IOL research has recently been extended into a logistics and

supply chain management context (Panayides 2007). Many com-

panies have sought to develop strong relationships with their

trading partners for the positive effect of learning on relation-

ships and performance. Spekman et al. (2002) explore the pre-

conditions for learning in a supply chain and established a

relationship between IOL and performance. The effect of

upstream knowledge exchange and learning between firms on

performance and innovativeness has been demonstrated in multi-

ple studies of supplier–manufacturer relationships (Modi and

Mabert 2007; Azadegan et al. 2008; Azadegan and Dooley

2010; Azadegan 2011; Berghman et al. 2012). For example,

Wagner (2012) examines how the absorptive capacity of manu-

facturers and supplier innovativeness affected the new product

development process. Another stream of research established

relationships between interfirm learning and performance in a

supply chain context (Hult et al. 2003, 2004, 2006, 2007). Flint

et al. (2008) examine the effect of the extent of learning across

firms in a supply chain on innovation and performance. Bessant

et al. (2003) explore supply chains as a mechanism for learning

and find little diffusion of learning beyond first-tier suppliers in

their study. Biotto et al. (2012) examine the diffusion of quality

management practices across a supply chain and find that the

exchange of product and service quality knowledge can posi-

tively affect learning, product and service quality, and perfor-

mance across multiple tiers. In two related case studies, the

adaptive capacity of firms within a supply chain were examined

and determined to affect inter-organizational adaptation and

learning (Knoppen et al. 2010, 2011).

The extant research provides a foundational theoretical under-

standing of IOL; however, two major gaps currently exist in our

understanding of IOL within a logistics and supply chain con-

text. First, we know little regarding the complex processes occur-

ring in the minds of the senior executives engaged in managing

and executing IOL. Second, IOL is defined as a process, but

prior research has largely explored IOL as a construct. As a

result, our understanding of the process by which firms engage

in IOL requires further investigation.

The process and construct of IOL as perceived, experienced,

and managed by logistics and supply chain executives has not

been investigated. Executives’perceptions are important to thor-

oughly understand IOL since these individuals exercise responsi-

bility in key areas that lie at the intersection of two or more

organizations. Senior executives have responsibility for assimilat-

ing, disseminating, and interpreting learning and creating organi-

zational memories (March 1991; Slater and Narver 1995);

developing absorptive, receptivity, and transparency capacities

(Larsson et al. 1998); affecting existence, breadth, elaborateness,

and thoroughness of knowledge gained (Huber 1991); and bal-

ancing between adaptive versus generative and explorative versus

exploitative learning (Crossan et al. 1999; Holmqvist 2009).

They need to answer questions such as who should be involved

in learning; how to motivate learning; and the best ways to man-

age the learning process (Flint et al. 2008). A limitation of

almost all studies is only the structural components of firms that

facilitate IOL have been examined. The literature needs to be

supplemented to further advance IOL theories to adequately

explain how executives perceive and go through the IOL

process.

The extant research supports the conceptualization of IOL as a

social process but has explored IOL as a construct. The realiza-

tion of IOL depends on the interaction between social actors and

the quality of relationships between organizations (Beesley 2004;

van Winkelen 2010). The IOL process occurs over time and

involves discernible break points that have been perceived and

recorded by several researchers (Nonaka and Toyama 2003;

Jones and McPherson 2006). IOL involves significant complexity

and ambiguity as learning may differ between firms due to an

absence of a formal, centralized decision-making authority

(Holmqvist 2009). This results in IOL typically being a slow,

time-consuming venture (Liebeskind et al. 1996). However, cur-

rent research, because of its focus on the structural components

that facilitate IOL, does not capture the dynamic nature of learn-

ing. The research does not look at the evolutionary aspects of

the process and what may hinder or facilitate this process from

an executive’s perspective.

104 I. Manuj et al.