Organizational Memory: Why Does It Matter?
The foundation of any organization is built on its effective utilization of memory about its facts, data, information and knowledge. Organizational memory is an ever-changing and integral part of organization learning which constitutes the creation, retention and transference of knowledge within an organization.
In today’s world of modern business, the speed at which organizations come into and go out of existence goes to show the importance of organizational memory as a foothold on which their success is built upon. Thus, an efficient management of organizational memory not only keeps organizations alive, but also flourishes in the business world.
As Quinello (2006) notes, the reconstruction of Japanese industries is the reason why Toyota was able to remake its organizational model through relevant changes to its production systems, such as a flexible mass production, and quality management, such as continuous product improvement. This not only made Toyota’s entry into the American market possible, but also revolutionized the management of organizational learning and memory via long-term self-support throughout the world.
The ability to foresee environmental changes, boost self-sufficiency and competencies, and create uncertainties are how successful organizations reach new development standards that give them a significant strategic edge. It is safe to state that the most successful businesses of today from Apple to Canon to Mitsubishi owe their successes to organizational memory. As Stein (1995) states, “organizational memory can lead to higher levels of effectiveness and competitive advantage by design.”
Therefore, being a collective or individual, memory provides insight for solving problems and decision-making which makes organizational memory a source of competitive advantage.
Quinello, Robson. (2006). Organizational memory and forgetfulness generating vulnerabilities in complex environments. BAR – Brazilian Administration Review, 3(1), 64-78. Retrieved May 18, 2015, from http://www.scielo.br/scielo.php?script=sci_arttext&pid=S1807-76922006000100006&lng=en&tlng=en. 10.1590/S1807-76922006000100006.
Stein, E.W. (1995). Organizational Memory: Review of Concepts and Recommendations for Management. International Journal of Information Management, 15(1): 17-32. Retrieved May 18, 2015, from www.chris-kimble.com/Courses/mis/ijim95.doc.