School of Business Although interest in organizational learning has grown dramatically in recent years, a general theory of organizational learning has remained elusive. We identify renewal of the overall enterprise as the underlying phenomenon of interest and organizational learning as a principal means to this end. With this perspective we develop a framework for the process of organizational learning, presenting organizational learning as four processes-intuiting, interpreting, integrating, and institutionalizing-linking the individual, group, and organizational levels.

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Companies tend to begin their internationalization process in countries that are 'psychically' close. Researchers describe the sequence of entry that firms follow and the mode of entry they choose. They suggest that psychically close countries are more easily understood than distant ones; and offer more familiar operating environments. Although not prescriptive, an unstated conclusion can be drawn linking sequence of entry to performance. Evidence from thirty-two Canadian retail companies shows that only seven (22%) were functioning successfully in the United States. The psychic distance paradox is that operations in psychically close countries are not necessarily easy to manage, because assumptions of similarity can prevent executives from learning about critical differences. Moreover, empirical evidence from 271 CEOs confirms greater cultural differences between Canada and the U.S. than assumed previously. Modifications are suggested to improve the psychic distance concept.

Organizational learning (OL) is receiving increasing attention from researchers and practitioners alike. In fact, some have suggested that the only sustainable competitive advantage is a firm's ability to learn faster than its competitors. In spite of OL's promise, the field has been slow to evolve. The primary impediments to the development of OL theory are that inconsistent terminology is used for comparable concepts and that different definitions are used to describe the phenomenon. Furthermore, many theorists have neglected to make explicit their underlying assumptions about the phenomenon. Employing an inductive approach, this review surfaces the implicit and explicit assumptions of OL researchers, identifying three key dimensions that differentiate perspectives: (1) unit of analysis—individual, group, organizational, and inter organizational; (2) cognitive/behavioral emphasis; and (3) the learning‐performance relationship.

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