The Business Book

205

The five disciplines
defined by Peter Senge
enable organizations to
change and develop
through both individual
and collective learning.

to help them get there. In this way,
employees will work toward a goal
because they want to, not because
they are told to. Team learning is
the process of employees learning
together through discussion and
dialogue so that they become more
effective as a team than they would
be individually.
The fifth discipline is the ability
to see the organization as a whole,
with its own behavior patterns.
This capability is crucial in order
for people to recognize potentially
counterproductive behaviors that
have come about simply through
repetition and have remained
unchallenged over the years.

Employee turnover

It is pertinent that Senge’s proposal

appeared against a backdrop of

corporate brain drain. According to

a 2004 paper by Arie C. Glebbeek

and Erik H. Bax from Groningen

University, the Netherlands,

published in the Academy of

Management Journal, when the

labor market tightened and labor

scarcity grew during the 1990s,

businesses became concerned with

the detrimental effects of turnover.

Turnover of personnel is one

of the great blights of modern

corporations and nations alike.

A desire for further learning and

development motivates talented

individuals to move in search of

a better environment with more

opportunity for advancement. It is

estimated that the cost of replacing

an employee is between 10 percent

and 175 percent of the departing

employee’s salary, depending on

the field of skill. Data from the

OECD (Organization for Economic

Cooperation and Development)

showed an increase in skilled labor

migration around the world starting

in the early 1990s. Much of this

drain was from developing

countries, and became gain for

host countries in North America,

Australasia, and Europe. But even

in advanced economies, brain drain

was a feature of corporate life.

During the 1990s, the highest

voluntary staff turnover rates in

Asia were in Singapore. The

Singapore hotel industry, for

example, had an average annual

turnover rate of 57.6 percent in

1997, while average annual turnover

rates in the retail industry ranged

from 74.4 percent to 80.4 percent

between 1995 and 1997. One

study by Singapore’s Nanyang

Business School in conjunction

with the UK’s Cardiff Business ❯❯

See also: The value of teams 70–71 ■ Creativity and invention 72–73 ■ Effective leadership 78–79 ■ Organizing teams and
talent 80–85 ■ Make the most of your talent 86–87 ■ Organizational culture 104–09 ■ Develop emotional intelligence 110–11

working with a vision

The learning

organization

Team

learning

Systems

thinking

Personal

mastery

Mental

models

Building

shared

vision

Productivity ... comes from

challenged, empowered,

rewarded teams of people.

Jack Welch

US former CEO, General Electric

(1935 –)