PDF Summary:The Fifth Discipline, by Peter M. Senge

The Fifth Discipline is Peter Senge’s guide to creating an evolving organization: an organization that encourages its members to constantly learn and develop their skills, and in turn to use those skills to improve the organization. Senge’s method for doing this is to practice five different disciplines, culminating in the most important discipline of all: systems thinking. For Senge—a systems scientist—systems thinking is the key to understanding how an organization works and how it fits into the much larger system of the world.

This guide will outline Senge’s five disciplines for creating an evolving organization. In our commentary, we’ll explain the science behind Senge’s key ideas, as well as draw connections to other influential business guides such as Skin in the Game, Principles: Life and Work, and Leading Change.

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(Shortform note: A survey from the Society for Human Resource Management confirms what Senge says here. The survey found that the single biggest contributing factor to job satisfaction is the chance to use skills and abilities—in other words, the chance to face challenges and improve by doing so. This trend held true regardless of the responders’ ages, genders, or tenures.)

How Personal Growth Ties Into the Big Picture

Senge reminds us that, for all his talk about learning and evolving organizations, organizations don’t actually learn; people learn and then contribute their improved skills and knowledge to the organization. Therefore, when every part of your company—in other words, each individual person within it—is committed to growth and improvement, the organization as a whole will naturally grow and improve.

To incorporate personal improvement into your business, Senge suggests building the company culture around it from the ground up. In short, every member of your company, as well as the company’s policies, must support honesty, creativity, and challenging the status quo.

However, if you’re not in a position to do that, you can also try to start it as a grassroots movement within the organization: Practice personal growth yourself, regardless of whether or not the higher-ups encourage it, and try to get your coworkers to do the same. Hopefully, your supervisor will take note of your department’s improved performance and ask how you accomplished it. That will begin an organizational change from the bottom up, rather than from the top down.

Personal Growth for Its Own Sake

As a partial counterpoint to Senge, entrepreneur Ray Dalio writes in Principles: Life and Work that self-improvement is its own reward. In other words, if you see personal growth as just a means to an end—such as earning more money or being more respected—you’ll soon become frustrated with it. This is because personal growth is a difficult process, and the satisfaction you get from material gains drops off quickly once your basic needs are fulfilled.

Therefore, Dalio believes that you should pursue personal growth and improvement as an end in itself. He believes that the satisfaction you get from improving your own skills and knowledge is far greater than the satisfaction you’d get from ever-increasing wealth. In other words, from Dalio’s perspective, the growth itself is the goal—Senge’s promises of improved job performance on a personal level and a more successful company on the organizational level are just side effects.

Discipline 2: Constant Worldview Improvement

The second of Senge’s disciplines is to improve your ability to see the big picture by constantly assessing and updating what you think you know.

What Senge calls mental models are the closely-held beliefs and assumptions that make up your worldview. Your worldview affects how you interpret your experiences, and it therefore constantly influences your thoughts and behavior.

Senge adds that it’s impossible to have a completely correct worldview—all worldviews are subjective and simplified versions of the truth. That's why he calls on us to constantly examine and improve our worldviews: to make them more correct, even though they’ll never be 100% correct.

Senge adds that people often have great ideas about how to improve themselves or their organizations but fail to implement those ideas because they contradict their secretly held beliefs. For example, a store manager might have an idea for a fun event to boost employee morale and customer engagement yet never bring it up because he or she assumes that executives will reject the idea. The manager could challenge this worldview by pitching the idea anyway and seeing if his or her beliefs hold true.

Science Is a Process of Worldview Improvement

Senge’s second discipline—constantly questioning what we think we know—isn’t a new idea. In fact, it’s the same process by which science progresses. In The Structure of Scientific Revolutions, philosopher of science Thomas Kuhn explains that gaining knowledge isn’t always a linear process of adding to what we already know; sometimes, learning new things requires us to overturn long-established theories and beliefs.

When scientists make observations that can’t be explained by current scientific theories, it’s a sign that they might need to reexamine the current scientific worldview. For example, when astronomers realized that the movements of stars and planets didn’t line up with their Earth-centric theory of the universe, that discovery eventually led to the current Sun-centric theory of the solar system.

In much the same way, each of us should always be on the lookout for new facts or observations that don’t fit our personal worldviews—any such anomaly could be an opportunity to make our worldviews more accurate.

Strengthening an Organization’s Worldview

According to Senge, organizations have worldviews just like people do—after all, organizations are made up of people. Furthermore, just like individual worldviews, company worldviews can be examined, questioned, and improved.

Changing an organization’s worldview requires extreme openness and honesty from its members. Therefore, the company culture must encourage everyone to speak their minds, share what they’re really thinking, and help each other realize what biases and assumptions they’re each bringing to the table.

Senge also notes that not everyone has to agree on a single worldview—but, everyone has to work together to give people in charge the most accurate worldview possible. They do this by pointing out flaws in the current mental model, offering ideas and alternatives, and supporting the mental model that is ultimately chosen as the strongest. In other words, everyone agrees to go along with the final decision, even if they still have personal reservations about it.

To keep discussions productive, remember that the goal isn’t to “win” or to have your own plans and ideas chosen. Rather, the goal is to make sure that the company goes forward with the most accurate worldview possible.

(Shortform note: A piece of advice commonly given to couples also applies to teams of any kind: It’s not “you versus me,” it’s “us versus the problem.” In other words, don’t think of these discussions as contests where one person is right and the others are wrong; instead, recognize that you all share the same goal, and work together to find the best way to reach that goal.)

Finally, Senge says that improving a worldview—whether your own or an organization’s—is a constant and ongoing process, just like personal growth. You’ll inevitably find flaws and mistaken beliefs with any worldview, so keep an open mind and continue making changes as needed.

Netflix Company Culture: Team Learning Through Feedback

Netflix is famous for having the sort of company culture Senge describes here: Every member of the organization is empowered to grow and improve, and to provide feedback to help the company endlessly improve as a whole.

As Netflix co-founder and CEO Reed Hastings explains in No Rules Rules, Netflix achieved this by making sure that every employee is open to both giving and receiving constructive feedback anywhere, at any time, and from any source—if a brand new employee wanted to give Hastings himself some feedback, the new hire would be encouraged to do so.

To make sure that every employee participates in Netflix’s culture of endless growth and feedback, Hastings created the following guidelines:

For the one giving feedback: Make it helpful and concrete. Any feedback you give should either help someone correct a problem or reinforce something that he or she is doing well. Don’t give feedback simply to vent or to upset the other person.

For the one receiving feedback: Be receptive and give it due consideration. Take any feedback you receive with an open mind; don’t get defensive or make excuses for your actions. You don’t have to act on every piece of feedback you get, but make sure to at least think about what the other person is saying.

With steady feedback from a variety of sources, each person can continuously improve on a personal level and help the company to improve in turn. Ideally, this creates a positive feedback loop of endless improvement.

How Worldview Improvement Ties Into the Big Picture

As your worldview becomes more accurate, you’ll gain a clearer picture of how individual elements come together to form systems, including how those parts influence each other and influence the system as a whole. This large-scale understanding is crucial because—as Senge explains—the line from cause to effect is often long and unclear. We’ve already discussed the time delay in receiving feedback; now Senge adds that changing one part of a system can affect distant, apparently unrelated parts of that system.

For example, imagine taking a painkiller when you have a headache: A pill goes into your stomach, and a little while later your head stops hurting. This doesn’t seem strange because you already know that all the parts of your body are an interconnected system. Senge is urging you to realize that a company functions much like a human body—making a change to one part of the organization could affect any or all of the other parts. Having a more accurate worldview will naturally improve your ability to see this big picture, and it’ll thus help you make effective and productive decisions.

Counterpoint: Predictions Are Bound to Fail

Senge believes that learning more about your company—your system—will allow you to better predict how your actions might impact it. Nassim Nicholas Taleb disagrees: In his book Antifragile, Taleb argues that predicting the future is impossible and that plans based on flawed predictions can have devastating outcomes. Instead, Taleb urges you to make plans with two things in mind:

First, plan for failure. Consider the worst-case scenario your actions could cause and proceed as if it’s guaranteed to happen. So, if you’re considering a risk that might lead to enormous profits but might also put your company out of business—an expensive acquisition that might not pay off, for instance—you know that it’s not worth the risk. However, if your organization could withstand the worst-case scenario, then you know it’s safe to proceed. In short, take the action with the least potential for harm, rather than the one with the most potential for gain. If possible, put safeguards in place to further minimize the harm.

Second, keep your options open. Every choice you make eliminates other choices that you could have made, and the farther ahead you try to plan, the more likely you are to make the wrong choice. Therefore, it’s best to wait on crucial decisions until they absolutely have to be made—that way, when the moment of choice arrives, you still have as many options as possible available to you.

In short, Taleb urges you to base your business model on caution and flexibility rather than risky forecasting; an incorrect prediction could ruin you, but a flexible organization can adapt to any situation without the need for predictions.

Discipline 3: A Common Mission

A common mission—what Senge calls a shared vision—forms when people orient their personal objectives toward an overarching goal. In other words, an organization comes together and says, “This is the future we want,” and then each member of that organization does his or her best to realize that vision.

Having a common mission gives the organization the energy and perseverance to work toward its long-term goals. Organizations that don’t have a common mission, on the other hand, won’t work as hard because the employees don’t have that motivation.

That doesn’t mean everyone has exactly the same vision, or that they sacrifice their personal aspirations for the common mission. Rather, everyone’s personal motivations influence how they view the common mission: Each person will approach the common mission in a slightly different way based on their own experiences, duties, and worldview. In fact, when coming up with a common mission, Senge advises you to find out what’s most important to each of your employees and to try to work those goals into it.

(Shortform note: We can adapt a tool from Angela Duckworth’s Grit to help align your employees with a common mission. In the context of personal growth, Duckworth suggests setting yourself an audacious overarching goal, then coming up with a series of smaller, manageable goals that each get you closer to that single end goal. From a company perspective, the common mission would be that overarching goal, and employees’ personal objectives are the smaller goals supporting it. You can then break down the individual goals into even smaller actions to determine how your company can support your employees’ goals and thus support its own common mission.)

For example, say a sneaker manufacturer creates a common mission that everybody in the country will have at least one good, solid pair of sneakers. A company survey then reveals that many employees have personal goals of caring for their families and improving the local community. The company might weave those missions together by offering employee discounts (helping them care for their families by giving them shoes) and organizing charity drives to give shoes to impoverished and homeless people (helping employees create positive changes in the community). In this way, a common mission bolsters the company as a whole and the employees as individuals.

(Shortform note: Life coach Jim Kwik says that a lot of our thoughts are attempts to answer our dominant questions: the questions that we ask ourselves repeatedly each day. For example, a business owner might ask, “How can I improve customer satisfaction?” while a boxer might ask, “How can I win my upcoming fight?” Such questions are important because they help us filter through all the information we encounter each day and look for information that’s relevant to answering them. So, if we consider a common mission to be like a dominant question for an entire organization, we can see how just having one will help employees to focus their thoughts and their efforts on finding ways to accomplish it.)

How a Common Mission Ties Into the Big Picture

Your company’s common mission is your end goal; big-picture thinking helps you to create and refine that goal, as well as see how to get there. The variety in perspectives from employees all working toward the same goal will help the company as a whole to learn, grow, and find creative solutions to problems.

While your mission should be audacious and inspiring, the steps you take to reach it don’t have to be. Senge explains that you can get big results from small changes, but the most effective changes are often the least obvious ones:, You don’t necessarily need to make big changes, you just need to make the right changes. Of course, which changes are the right ones will depend on your organization and the market you’re operating in. Having a lot of different perspectives and ideas will help you to find and make those less-obvious changes; one person might find a solution that others have overlooked.

(Shortform note: In Range, David Epstein strongly emphasizes the importance of organizations gathering diverse opinions from people who have had many different experiences. In other words, while it’s good to get ideas from a lot of different people, it’s even better if those people come from different backgrounds (for example, ethnic backgrounds or professional backgrounds). By bringing together such diverse knowledge and points of view, the company is more likely to find innovative and effective ways to solve problems and achieve its goals.)

How Small Changes Add Up

In Atomic Habits, entrepreneur James Clear discusses how small adjustments in your day-to-day habits can come together to create powerful changes in your life. Habits compound upon each other—one good habit inspires you to adopt another, and another, and so on until your life is completely transformed. For example, getting in the habit of taking a short walk each day is a good step toward long-term health; however, as you start feeling better from the exercise, you might find yourself inspired to also take up a sport or start eating healthier.

We can apply this same principle to a company or organization: Small adjustments to processes and policies—essentially, the organization’s “habits”—can add up to major improvements in productivity, employee happiness, and customer satisfaction. This is especially true if a small change leads to good feedback from customers or employees. That positive response could then inspire you to make further helpful changes, creating a positive feedback loop that leads to ever-improving outcomes.

Discipline 4: Group Evolution

Group evolution—what Senge calls team learning—is the process by which a group of people learns how to work together effectively and help each other reach their shared goals. Senge says that group evolution has three key aspects:

1) Group-based worldview improvement. As we discussed previously, team members should work together to identify each other’s faulty assumptions and improve each others’ worldviews.

2) Spontaneous teamwork. A team that has learned to work together and evolve together will sometimes take actions that are unplanned, yet perfectly coordinated. Much like a trained and practiced troupe of improvisational actors, the team members understand and trust each other to the point that their teamwork becomes instinctual.

Shared Consciousness and Individual Empowerment

In Team of Teams, retired US Army general Stanley McChrystal also discusses this sort of spontaneous teamwork, which he calls shared consciousness. McChrystal describes this phenomenon as a moment when people stop thinking as individuals and instead become a single cohesive unit. As an example, he talks about three Navy SEAL snipers who—having built this kind of instinctive teamwork through intense training and experience—acted together without communicating to take down three different targets simultaneously.

McChrystal adds that spontaneous teamwork requires team members to be empowered, meaning each person is able to act on his or her own without needing to consult a superior. In his anecdote, the three snipers didn’t need to wait for a command to fire—they all simply knew when the moment was right and took the opportunity. In fact, needing to get approval from a higher-up would have interrupted their seamless teamwork and made them less effective—they could have missed their opening while waiting for the go-ahead.

In short, spontaneous teamwork happens when people have the authority to act independently and the experience to act synchronously.

3) Connections with other teams. Remember that your team is just one part of a larger system, and whatever decisions you make will likely need other teams from other parts of the organization to put them into practice. Therefore, it will benefit your team (and the organization as a whole) to promote group evolution practices among those other teams as well.

(Shortform note: While different teams will often have different specific goals, they should all share the same overarching interests—namely, making sure the company is successful and pursuing its common mission. Therefore, you can foster connections between seemingly unrelated teams by using those common interests as a starting point. Furthermore, by encouraging every team to constantly work with and learn from each other, you’ll help the organization as a whole to evolve.)

Senge warns that group evolution is a difficult process, and it will take a lot of practice—figuring out how to work together effectively often means discovering all the ways that you don’t work together effectively. Personalities might clash, ideas may interfere with each other, and team members might find themselves stepping on each others’ toes when communication isn’t clear enough. That’s why Senge lays down the rule: Do not assign blame.

An evolving team—and an evolving organization—is bound to make mistakes along the way. In fact, that’s how evolution happens: People make mistakes or run into problems and then learn how to avoid them in the future. Just remember that you are a team, working together and learning together. So, instead of turning against each other to find someone to blame, turn your combined efforts against the problem.

(Shortform note: In Extreme Ownership, former Navy SEALS Jocko Willink and Leif Babin take this rule even further: Not only should you not assign blame to others, but you should also hold yourself personally responsible for everything that goes wrong, regardless of whose “fault” it is. By making every problem your problem, you’ll drive yourself to constantly look for ways to improve yourself and your team. This is an extreme approach to being a team member—hence the title Extreme Ownership—but Willink and Babin believe that each person taking personal responsibility is the most effective way to drive group evolution.)

How Group Evolution Ties Into the Big Picture

Senge asserts that group evolution is, in essence, organizational evolution on a smaller scale. It requires the same skills and practices as improving your organization’s worldview, and it’s how your team members help each other to accomplish the organization’s common mission.

Also, your team is part of the organization as a whole—so by helping your team to improve its worldview, develop teamwork, and spread those skills to other teams, you’re directly doing the work of creating an evolving organization.

Remember that an organization is nothing but the people who comprise it—once every team and every person in the organization is practicing personal growth and big-picture thinking, you will have created an evolving organization.

How to Lead Organizational Change

Successfully creating any kind of organizational change, either on a team level or a whole-organization level, is difficult; it requires strong leadership, a clear vision, and collective effort from members of the organization. Leadership expert and consultant John Kotter writes in Leading Change that effective organizational change is a seven-step process:

1. Create urgency. Make sure everyone understands why this change has to happen and why it has to happen now.

2. Make a team. Put together a group of people with diverse skill sets to lead the organizational change.

3. Develop your vision. Make sure you have a clear and specific idea of your company’s future. In other words, what are you ultimately trying to accomplish by making this change?

4. Sell your vision. Prepare a statement that you can distribute through the organization explaining what your vision is and why it’s right for the company. Make sure your statement is clear—avoid jargon—and invite feedback on and discussion about the vision.

5. Clear the way. Identify obstacles to change and overcome them. Common obstacles include pushback from supervisors and managers and insufficient training among core staff.

6. Set small goals to produce small victories. As you implement large-scale and long-term change, keep people motivated and determined by setting achievable milestones and celebrating when you pass them.

7. Update the company culture. Once you’ve accomplished your change, make it stick by making it a part of the company culture. For example, if your goal was to boost employee satisfaction, you might try relaxing the company dress code or guaranteeing more vacation time in employee contracts. Make sure your organizational leaders are on board with the new culture—you might find it necessary to replace the most recalcitrant supervisors or managers.