PROFESSOR ALLAN GIBB IS CHAIRMAN OF the Small Business Centre at Durham University Business School, England. This paper begins with a review of the present concerns to link training with competitiveness in the United Kingdom and Europe. It notes that many of the issues raised in this respect are over 20 years old. It suggests therefore a new way to approach the problems, namely by considering the learning needs that will reduce the transaction costs of the small firm operating its stakeholder environment. After defining the concept of learning it makes the distinction between contextual learning (via experience) and the associated tacit (subjective) knowledge that is gained by this, and objective and abstract knowledge frequently purveyed by teachers. It then explores the issue of the SME as a 'learning company' and argues that the key to its learning is via the transactional and other relationship that it has with its immediate network environment. The concept of learning circles and learning partnerships is introduced as a basis for exploring in some detail the issue of 'who' needs to learn. It is argued that the learning needs of those who effectively dictate the level of the playing field for achieving small business success are very high. The nature and importance of this learning need is then explored for key groups. It is argued that the benefits to society of this holistic approach to learning is a reduction in the 'discontinuities' between the SME and its environment and therefore a lowering of transaction costs.
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