Chapter 16: Organizational Learning

1. Through the medium of written symbols, our individual mental powers are melded into "organized intelligence."

2. Logically, if an organization can be said to have "intelligence," then it ought to behave like an intelligent organism; it ought to learn from experience.

3. Because firms keep modifying their products, the unit of production experience is unstable, making impossible any fair comparisons between earlier and later units.

4. Companies must measure their costs with money. For a variety of reasons, the actual economic value measured by one dollar, yen, etc. keeps changing over time.

5. The act of learning actually takes place inside individual firms, not across an industry as a whole. An industry is a population of similar organizations just as a species is a population of similar organisms. A population does not learn, individuals do.

6. The leakage of new technology from innovators to copiers is the mechanism of industry-wide learning.

7. The economic species as a whole evolves to fit its niche precisely. Like a biological species, an industry has an "evolution curve" independent of the individual "learning curves" of its members. In this sense, evolution is a learning process that unfolds at a species-wide or industry-wide level.

8. Intense financial pressure led Darwin Farms to be the first commercial egg producer in the world to test radical cost-saving technologies. Over time a variety of innovations have driven the inflation-adjusted cost of producing one egg ever-downward.

9. Like every other innovation that has swept through egg farming in the last 59 years, technology will lead to lower production costs and lower consumer prices.

10. In the future, genetic-engineering firms may come up with chickens whose productivity dwarfs that of today's best breeds. As technology changes, learning and experience gathering by industries continue.