Action research was used to study the effectiveness of Learning Organisation and Adaptive Enterprise theories for promoting organisation-wide learning and creating a more effective early childhood education organisation. This article describes the leadership steps taken to achieve shared vision via meaningful dialogue between board, management and staff that encouraged mental models to be revealed and modified as conflicts in deeply held beliefs became reconciled. Consideration of feedback relationships provided valuable systemic insights and a choice of organisation futures. Over time, the new mindset resulted in new infrastructure, policies, training and reward practices that enabled the organisation to compete very successfully against other service providers through a differentiation strategy of quality and responsiveness. Significant and enduring improvement in the self-esteem of empowered individuals was also noted. The results of this research should be of interest to any leader who needs to radically transform attitudes and beliefs, promote organisation-wide learning, and effectively implement widespread, enduring change. (Contains 3 figures.)