Introduction
It is widely recognized that knowledge is an essential strategic resource for a firm to retain sustainable competitive advantage. As knowledge is created and disseminated throughout the firm, it has the potential to contribute to the firm's value by enhancing its capability to respond to new and unusual situations. There is growing evidence that firms are increasingly investing in knowledge management (KM) initiatives and establishing KM systems in order to acquire and better exploit this resource [1].
The growing importance of knowledge as a critical resource has encouraged managers to pay greater attention to the firms’ KM strategies. Appropriate KM strategies are important to ensure that the alignment of organizational process, culture, and the KM-related information technology (IT) deployment produce effective knowledge creation, sharing, and utilization [2]. KM strategies are no longer empty buzzwords but a fundamental concern for many firms [3] and [4].
A growing body of KM research has examined the range of KM strategies, and attempted to classify them. A synthesis of this research suggests that KM strategies can be primarily categorized based on two key dimensions: (i) KM focus and (ii) KM source. On the KM focus dimension, KM strategies can be categorized as explicit- and tacit-oriented. Explicit-oriented strategy attempts to increase organizational efficiencies by codifying and reusing knowledge mainly through advanced ITs [4]. Tacit-oriented strategy takes on the personalization approach where tacit knowledge is communicated through direct person-to-person contact and through socialization processes [5]. The second dimension to orient to KM strategy is based on the firm's primary source knowledge. KM strategies can be classified as internal- and external-orientation along this dimension [6] and [2]. External-oriented strategy attempts to bring knowledge from outside sources via either acquisition or imitation and then transferring the knowledge throughout organization [7]. Internal-oriented strategy focuses on generating and sharing knowledge within the boundary of the firm.
While researchers have sought to enhance organizational performance by providing guidelines for appropriate KM strategies, how different KM strategies affect organizational performance is not well understood. Even though several empirical studies have examined the relationship between KM strategies and organizational performance, the results to date have been mixed. Some researchers insist that KM strategies are better followed in isolation. Companies should mainly focus on a single strategy [4] and [8]. Other studies argue that organizations should pursue an integrated approach to KM which calls for the combining of KM strategies appropriately. Complementarities among such strategies are considered crucial from the perspective of their influence on organizational performance [6] and [9].
Previous research has contributed to our understanding of whether and how KM strategies help or hinder organizational performance. However, little consideration has been given to the underlying factors that can explain such results. We argue that the lack of adequate theoretical foundation has impeded research progress in this area.
This research aims to explore the synergistic relationship between KM strategies and their impact on organizational performance. This paper presents a framework of “complementarity” analysis as the theoretical basis for analyzing the impact of KM strategies on organizational performance. In particular, by drawing on the complementarity theory from the economics literature [10] and [11], this paper seeks to answer the question, which KM strategy or strategies work well together and what are the performance implications. This research will make the following contributions towards advancing the literature by:
(i)
presenting how the use of association analysis can provide further insights into understanding the various types of complementary relationships.
(ii)
providing empirical analysis of complementarity among KM strategies and their effects on organizational performance.
The outline of this paper is as follows: we survey prior literature on the topic in Section 2. A description of our research methodology to investigate the relationships between KM strategies and organizational performance is provided in Section 3, followed by the data description, analysis, and results in Section 4. The limitations and implications of the study are discussed in Section 5. Section 6 concludes the paper.
Introduction
It is widely recognized that knowledge is an essential strategic resource for a firm to retain sustainable competitive advantage. As knowledge is created and disseminated throughout the firm, it has the potential to contribute to the firm's value by enhancing its capability to respond to new and unusual situations. There is growing evidence that firms are increasingly investing in knowledge management (KM) initiatives and establishing KM systems in order to acquire and better exploit this resource [1].
The growing importance of knowledge as a critical resource has encouraged managers to pay greater attention to the firms’ KM strategies. Appropriate KM strategies are important to ensure that the alignment of organizational process, culture, and the KM-related information technology (IT) deployment produce effective knowledge creation, sharing, and utilization [2]. KM strategies are no longer empty buzzwords but a fundamental concern for many firms [3] and [4].
A growing body of KM research has examined the range of KM strategies, and attempted to classify them. A synthesis of this research suggests that KM strategies can be primarily categorized based on two key dimensions: (i) KM focus and (ii) KM source. On the KM focus dimension, KM strategies can be categorized as explicit- and tacit-oriented. Explicit-oriented strategy attempts to increase organizational efficiencies by codifying and reusing knowledge mainly through advanced ITs [4]. Tacit-oriented strategy takes on the personalization approach where tacit knowledge is communicated through direct person-to-person contact and through socialization processes [5]. The second dimension to orient to KM strategy is based on the firm's primary source knowledge. KM strategies can be classified as internal- and external-orientation along this dimension [6] and [2]. External-oriented strategy attempts to bring knowledge from outside sources via either acquisition or imitation and then transferring the knowledge throughout organization [7]. Internal-oriented strategy focuses on generating and sharing knowledge within the boundary of the firm.
While researchers have sought to enhance organizational performance by providing guidelines for appropriate KM strategies, how different KM strategies affect organizational performance is not well understood. Even though several empirical studies have examined the relationship between KM strategies and organizational performance, the results to date have been mixed. Some researchers insist that KM strategies are better followed in isolation. Companies should mainly focus on a single strategy [4] and [8]. Other studies argue that organizations should pursue an integrated approach to KM which calls for the combining of KM strategies appropriately. Complementarities among such strategies are considered crucial from the perspective of their influence on organizational performance [6] and [9].
Previous research has contributed to our understanding of whether and how KM strategies help or hinder organizational performance. However, little consideration has been given to the underlying factors that can explain such results. We argue that the lack of adequate theoretical foundation has impeded research progress in this area.
This research aims to explore the synergistic relationship between KM strategies and their impact on organizational performance. This paper presents a framework of “complementarity” analysis as the theoretical basis for analyzing the impact of KM strategies on organizational performance. In particular, by drawing on the complementarity theory from the economics literature [10] and [11], this paper seeks to answer the question, which KM strategy or strategies work well together and what are the performance implications. This research will make the following contributions towards advancing the literature by:
(i)
presenting how the use of association analysis can provide further insights into understanding the various types of complementary relationships.
(ii)
providing empirical analysis of complementarity among KM strategies and their effects on organizational performance.
The outline of this paper is as follows: we survey prior literature on the topic in Section 2. A description of our research methodology to investigate the relationships between KM strategies and organizational performance is provided in Section 3, followed by the data description, analysis, and results in Section 4. The limitations and implications of the study are discussed in Section 5. Section 6 concludes the paper.
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