Relationships among Critical Success Factors of Knowledge Management and Organizational Performance
Amir Hossein Dastaviz
The main objective of this study is to find relationships
among critical success factors of Knowledge Management (KM) include; organizational
factors and KM processes with organizational performance. The research proposes
that KM in the public sector is still in its infancy and has a long way to go
in the KM journey. However, the study has identified a certain number of factors
that are essential to the success of the KM initiative and program in the public
sector. The study also explain current situation in terms of KM activities in
the public sector in Iran and sustain the discussion about KM processes in the
public sector. The result of this investigation could have significant implications
for KM programs in public sector organizations in Iran. The paper describes
and develops a framework of KM process in the public sector as well as recommendations
to practitioners about planning and implementing KM programs and initiatives.
Received: January 08, 2013;
Accepted: April 11, 2013;
Published: June 28, 2013
Nowadays in various developing countries including Iran, managers are eager
to create KM programs in organizations with the aim of taking advantage of its
useful results (Kazemi and Allahyari, 2010). One of
the main objectives of managers in the use of KM in organizations is to improve
knowledge sharing between individuals in organizations and between individuals
and organizations in order to create competitive advantage (Lin
and Lee, 2009). Effective KM reduces costs in production of knowledge and
ensures to publish the best practices working in organization and enables organizations
to solve their problems (Cummings and Worley, 2008).
Due to lack of enough experience in the field of KM in many organizations, managers
must understand the problems when creating KM programs in their organizations
(Davenport and Prusak, 1998). This study attempts through
literature review some main factors are extracted that these factors show how
to succeed in KM programs.
KM IN PUBLIC SECTOR
Although, academics and practitioners extensively talk about KM, there is not
a lot of information on KM in the public sector. Cong
et al. (2007) have stressed that KM in the public sector is still in
the early stages of development and it has to go a long way. Cong
and Pandya (2003) mentioned governments are now realizing the importance
of KM in its policy-making and service delivery to the public and some of the
government departments are beginning to put KM high on their agenda. However,
implementation is not as easy as would have been expected.
There are many issues that need to be addressed relating to KM in the public
sector, the chief of which is the lack of awareness (Cong
and Pandya, 2003). Awareness is one of the key components of successful
KM. It should be raised not only for managers at all levels, but also for frontline
personnel. There is a need for KM to be better understood and the concept and
benefits of KM should be much talked about by everyone in the organization in
order for the organization to be conducive for KM practices. According to Syed-Ikhsan
and Rowland (2004) one of the most important issues that should be paid
attention to is to have a systematic training for all employees and to develop
a culture that can promote knowledge sharing. Based on the Chawla
and Joshi (2010) and Cong et al. (2007)
there are barriers to effective KM in the public sector. The most important
of them are structural and cultural barriers exist in public organizations.
Rigid organizational structure and hierarchy, lack of formal information sharing
mechanism, accountability to higher government organizations, leadership capabilities,
resources, reward and recognition and trust and knowledge sharing environment
are major factors that inhibit KM in this sector.
KM in public sector in Iran: Iran has strongly stressed on pushing forward
its fourth and fifth 5-year development plan to be focused on a knowledge-based
economy. In a study, Gharibi (2006) says though, there
is quite a long way to get assured of real knowledge-based approaches in all
aspects of the countrys managerial system but a tiered structure is beginning
to form within the Iranian information industry. Despite a great number of governmental
organizations and private firms are busy with installation of computers of their
business processes and to develop databases built, a few groups of the various
industries are moving towards knowledge management.
CRITICAL SUCCESS FACTORS OF KM
Organizational factors: Every organization has a unique environment
and particular key organizational factors such as structure, culture, technology
and so on which play a crucial role in the overall performance of the organization
(Rhodes et al., 2008). Synthesis some of studies
related to organizational factors show that, there are various views about the
key organizational factors effectively on KM processes but most of researchers
such as (Akhavan et al., 2009; Anantatmula
and Kanungo, 2010; Jafari et al., 2007;
Rhodes et al., 2008) have focused on five factors
organizational leadership, culture, structure, people or human resources and
IT as the most effectively factors. Therefore the key organizational factors
selected for this study, based on the literature analysis are: organizational
leadership, culture, structure, people and IT.
Regarding the levels of impact of each of the above organizational factors
on KM processes, there are different findings in prior studies in various environments.
For example, the level of impact of IT on knowledge transfer has various findings
in different environments. Rhodes et al. (2008)
conducted a study on knowledge transfer issues in Taiwanese high-tech companies.
In this study, they ascertained that IT system had the most significant impact
on organizational knowledge transfer. However, Ngoc (2005)
investigated in a study on knowledge transfer issues in Vietnam's IT companies
and found that the application of IT had the lowest influence on knowledge transfer.
Furthermore, Syed-Ikhsan and Rowland (2004) carried
out an exploratory study on knowledge transfer issues in the public sector in
Malaysia. Although the study revealed that most respondents are agreed on using
different tools that help them share their knowledge, there is no significant
relationship between ICT and performance of knowledge transfer in the test.
These findings show that there are no same levels of the impact of organizational
factors on KM processes. Therefore, the impact of organizational factors on
KM processes can be measured and examined in an intended environment.
KM processes: The comparative analysis of knowledge management concepts
reveals several distinguished observations (Alavi and Leidner,
2001; Bergeron, 2003; Lee and
Kim, 2001; Teece, 2003). Therefore, it is essential
to organize and consolidate knowledge management processes in a way that not
only describes each process clearly and completely but also identifies their
interrelationships. Among these processes, this study intends to describe KM
processes adopted based on Alavi and Leidner (2001)
include, (a) Creating the knowledge (including knowledge maintenance and updating),
(b) Storing and retrieving the knowledge, (c) Sharing (transferring) the knowledge
and (d) Applying the knowledge.
Organizational performance: The focus on organizational performance
to sustain competitive advantage is necessary for any organization. However,
the measurement of organizational performance may take different forms Rhodes
et al. (2008). There are different approaches for measuring organizational
performance. Some papers make use of KM outcome measures like innovation Rhodes
et al. (2008) or provide a comprehensive set of criteria in measuring
organizational performance (Choy et al., 2006).
Some of the studies adopted other manners performance measures like KM
performance index (KMPI) as a new metric for assessing the performance
(Lee et al., 2005) or KM as a coordinating mechanism
(Darroch, 2005). Some papers make sure of benchmarking
approach or the Balanced Scorecard (BSC) technique for measuring KM performance
PREVIOUS RESEARCH STUDIES OF KM
Relationship between Organizational factors and KM Processes: Anantatmula
(2008) argued about Leadership role in making effective use of KM. Findings
of study stated that choice a competent leader is the vital first step in establishing
an effective KM initiative. Singh (2008) indicated
that consulting and delegating styles of leadership have positive significant
relationship with KM practices. Crawford (2005) indicated
among the various leadership styles there is a strong relationship between transformational
leadership and Lee and Kim (2001) found that managerial
drivers such as information technology, reward system and top management supports
significantly affect the building of supportive organizational climate for KM
activities. In addition, this relationship can be explained by the use of social
capital theory. Social capital facilitates the development of intellectual capital
by affecting the conditions necessary for exchange and combination to occur
(Nahapiet and Ghoshal, 1998).
Relationship between KM processes and organizational performance: Rhodes
et al. (2008) examined the effect of both explicit and tacit knowledge
transfer on innovative capabilities and organizational performance. Savvas
and Bassiliades (2009) conducted an empirically study in order to test the
degree of influence of different knowledge-sharing mechanisms on the innovation
capability of firms. Findings of this study show that knowledge sharing is a
key issue with the purpose of doing enhance the innovation capability of firms.
According to Huang and Li (2009), KM provides a positive
contribution to transform tacit knowledge into innovative products, services
and processes and thus lead to better technical and administrative innovation
In addition, the relationship between KM processes and organizational performance
are supported by Resource Based View (RBV) of the firm. The RBV argues that
firms possess resources that a subset of those leads firms to superior long-term
performance. According to Holsapple and Joshi (2004),
KM can be viewed as an important firm resource because it allows the firm to
better leverage its knowledge resources through more efficient knowledge processors
and improved knowledge processes involving the activities of generation, acquisition,
selection, assimilation and emission of knowledge.
Relationships between organizational factors and organizational performance:
The third category emphasizes on relationship between organizational factors
and organizational performance. These factors include leadership paradigm Anantatmula
(2008), organizational culture (King, 2008), organizational
structure Rhodes et al. (2008) organizational
human resource Syed-Ikhsan and Rowland (2004) and information
technology (Sher and Lee, 2004).
A review of the literature indicates that organizational factors are related
resulting in varying degrees of their influence on the KM processes ability
of the organization. In relation to the levels of impact of organizational factors
on KM processes, there are different findings in the prior studies in various
environments. These findings show that there are no same levels of impact of
organizational factors on KM processes (Ngoc, 2005; Rhodes
et al., 2008; Syed-Ikhsan and Rowland, 2004).
So, the role of KM processes in conceptual models is not consistent. The comparative
analysis of previous studies related to KM concepts reveals that there are no
common or generic KM processes (Lee and Choi, 2003;
Lin and Lin, 2006; Singh, 2008;
Huang and Li, 2009; Zheng et
Despite the literature findings that helped to identify KM enablers (i.e.,
organizational factors, KM processes and organizational performance) understanding
how these factors interact and influence each other is considered important
to develop this study model. Previous research studies have not addressed this
concern. Implicitly, an integrative KM model for the public sector is still
missing. Although some researchers investigate the relationships among organizational
factor KM processes, or organizational performance (Anantatmula,
2008; King, 2008), they dont try to examine
the relationships between organizational factors, KM processes and organizational
performance simultaneously in a public sector.
Furthermore, the direct and indirect effect of these organizational factors
can have significant impact on the organizational performance. Finally, the
relationship between KM processes and organizational performance can be determined
based on the supportive evidence from literature. The overall conceptual framework
for this study is presented in Fig. 1.
|| The overall situation of conceptual framework
Policy-making and service delivery have been the two major tasks of government.
In these processes, knowledge has been an essential resource of the government
and assumes special importance in the every step of the process business of
government. Most important of all, effective functioning of government rests
on effective sharing and use of knowledge by public sector employees at various
levels, central or local (Cong et al., 2007).
Moreover, nowadays the importance of KM is clear to many organizations and the
leaders search for the main reasons and factors for being successful in KM system
design and implementation through their organizations. The various studies showed
that KM in public sector of developing countries in comparing with developed
countries is still in its infancy and has a long way to go in order to keep
pace with private sector counterparts (Chawla and Joshi,
2010; (Cong et al., 2007).
In this study, through literature review some main factors were extracted that
these factors show how to succeed in KM programs. A framework can be conceptualized
through the findings of this research as shown in Fig. 1.
This framework shows building blocks for success of KM in an organization. A
plausible reason could be that public sector organizations are traditionally
characterized by hierarchies, with few incentives for innovation and team work.
Often the incentives to share best practices does not exist or not very clear.
On the other hand, private sector organizations make use of internal benchmarking
effectively to identify improvement opportunities. Ultimately, the result of
this investigate could have significant implications for KM programs in public
sector organizations in Iran. This paper is an inclusive addressing and analysis
of the process of KM in the public sector in Iran. The paper describes and develops
a framework of KM process in the public sector as well as recommendations to
practitioners about planning and implementing KM programs and initiatives.
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