Aspiration Performance and Railroads' Patterns of Experiential Learning from Train Wrecks and Crashes

47 Pages Posted: 8 May 2006

See all articles by Joel A. C. Baum

Joel A. C. Baum

University of Toronto - Joseph L. Rotman School of Management

Kristina Dahlin

University of Oxford - Said Business School; University of Oxford - Department of Engineering Science

Date Written: January 27, 2006

Abstract

We link two influential organizational learning models - performance feedback and experiential learning - to advance hypotheses that help explain how organizations' learning from their own and others' experience is conditioned by their aspiration-performance feedback. Our focus is on learning from failure, which is essential to organizational learning and adaptation, and a necessary complement to studies of learning from success. Our analysis of U.S. freight railroads' accident costs from 1975 to 2001 shows that when a railroad's accident rate deviates from aspiration levels, the railroad benefits less from its own accident and operating experience and more from other railroads' accident and operating experience. These findings, which support the idea that performance near aspirations fosters exploitative learning, while performance away from aspirations stimulates exploration, provide a foundation for constructing more integrated models of organizational learning and change.

Keywords: Organizational Learning, Learning Curves, Performance Feedback, Learning from Failure, Accident Reduction, Railroads

JEL Classification: D83, L92

Suggested Citation

Baum, Joel A.C. and Dahlin, Kristina, Aspiration Performance and Railroads' Patterns of Experiential Learning from Train Wrecks and Crashes (January 27, 2006). Available at SSRN: https://ssrn.com/abstract=899603 or http://dx.doi.org/10.2139/ssrn.899603

Joel A.C. Baum (Contact Author)

University of Toronto - Joseph L. Rotman School of Management ( email )

University of Toronto
105 St. George Street
Toronto, ON, M5S 3E6
Canada
416-978-4914 (Phone)
416-978-4629 (Fax)

HOME PAGE: http://www.rotman.utoronto.ca/~baum

Kristina Dahlin

University of Oxford - Said Business School ( email )

Park End Street
Oxford, OX1 1HP
Great Britain

University of Oxford - Department of Engineering Science ( email )

Mansfield Road
Oxford, Oxfordshire OX1 4AU
United Kingdom

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