knowledge management enablers, processes, and...

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KM ENABLERS, PROCESSES, AND ORGANIZATIONAL PERFORMANCE 179 Journal of Management Information Systems / Summer 2003, Vol. 20, No. 1, pp. 179–228. © 2003 M.E. Sharpe, Inc. 0742–1222 / 2003 $9.50 + 0.00. Knowledge Management Enablers, Processes, and Organizational Performance: An Integrative View and Empirical Examination HEESEOK LEE AND BYOUNGGU CHOI HEESEOK LEE is a Professor of Information Systems at the Graduate School of Man- agement, Korea Advanced Institute of Science and Technology, Korea. He received his Ph.D. in MIS from the University of Arizona, an M.S. from Korea Advanced Institute of Science and Technology, and a B.S. from Seoul National University. He was previously on the faculty at the University of Nebraska at Omaha. His research interests include knowledge management, Internet business, and IS strategy. His re- cent publications appear in Journal of Management Information Systems, Informa- tion and Management, Journal of Organizational Computing and Electronic Commerce, Expert Systems with Applications, Annals of Operations Research, Jour- nal of Systems and Software, and Information Systems. BYOUNGGU CHOI is an Associate Researcher at the Carlson School of Management, University of Minnesota. He received his Ph.D. and M.S. in Management from Korea Advanced Institute of Science and Technology and his B.S. from Korea University. His research interests include Knowledge Management and Electronic Commerce. His recent publications appear in Journal of Management Information Systems, In- formation and Management, and Expert Systems with Applications. ABSTRACT: Knowledge is recognized as an important weapon for sustaining com- petitive advantage and many companies are beginning to manage organizational knowl- edge. Researchers have investigated knowledge management factors such as enablers, processes, and performance. However, most current empirical research has explored the relationships between these factors in isolation. To fill this gap, this paper devel- ops a research model that interconnects knowledge management factors. The model includes seven enablers: collaboration, trust, learning, centralization, formalization, T-shaped skills, and information technology support. The emphasis is on knowledge creation processes such as socialization, externalization, combination, and internal- ization. To establish credibility between knowledge creation and performance, orga- nizational creativity is incorporated into the model. Surveys collected from 58 firms were analyzed to test the model. The results confirmed the impact of trust on knowl- edge creation. The information technology support had a positive impact on knowl- edge combination only. Organizational creativity was found to be critical for improving performance; neglecting ideas can undermine a business. The results may be used as a stepping stone for further empirical research and can help formulate robust strate- gies that involve trade-offs between knowledge management enablers. KEY WORDS AND PHRASES: knowledge-creating processes, knowledge management, knowledge management enablers, organizational creativity, organizational performance.

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KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 179

Journal of Management Information Systems Summer 2003 Vol 20 No 1 pp 179ndash228

copy 2003 ME Sharpe Inc

0742ndash1222 2003 $950 + 000

Knowledge Management EnablersProcesses and OrganizationalPerformance An Integrative View andEmpirical Examination

HEESEOK LEE AND BYOUNGGU CHOI

HEESEOK LEE is a Professor of Information Systems at the Graduate School of Man-agement Korea Advanced Institute of Science and Technology Korea He receivedhis PhD in MIS from the University of Arizona an MS from Korea AdvancedInstitute of Science and Technology and a BS from Seoul National University Hewas previously on the faculty at the University of Nebraska at Omaha His researchinterests include knowledge management Internet business and IS strategy His re-cent publications appear in Journal of Management Information Systems Informa-tion and Management Journal of Organizational Computing and ElectronicCommerce Expert Systems with Applications Annals of Operations Research Jour-nal of Systems and Software and Information Systems

BYOUNGGU CHOI is an Associate Researcher at the Carlson School of ManagementUniversity of Minnesota He received his PhD and MS in Management from KoreaAdvanced Institute of Science and Technology and his BS from Korea UniversityHis research interests include Knowledge Management and Electronic CommerceHis recent publications appear in Journal of Management Information Systems In-formation and Management and Expert Systems with Applications

ABSTRACT Knowledge is recognized as an important weapon for sustaining com-petitive advantage and many companies are beginning to manage organizational knowl-edge Researchers have investigated knowledge management factors such as enablersprocesses and performance However most current empirical research has exploredthe relationships between these factors in isolation To fill this gap this paper devel-ops a research model that interconnects knowledge management factors The modelincludes seven enablers collaboration trust learning centralization formalizationT-shaped skills and information technology support The emphasis is on knowledgecreation processes such as socialization externalization combination and internal-ization To establish credibility between knowledge creation and performance orga-nizational creativity is incorporated into the model Surveys collected from 58 firmswere analyzed to test the model The results confirmed the impact of trust on knowl-edge creation The information technology support had a positive impact on knowl-edge combination only Organizational creativity was found to be critical for improvingperformance neglecting ideas can undermine a business The results may be used asa stepping stone for further empirical research and can help formulate robust strate-gies that involve trade-offs between knowledge management enablers

KEY WORDS AND PHRASES knowledge-creating processes knowledge managementknowledge management enablers organizational creativity organizational performance

180 LEE AND CHOI

IN RECENT YEARS IT SEEMS AS THOUGH businesses that could capture the knowledgeembedded in their organization would own the future Companies that isolate knowl-edge management risk losing its benefits It is no surprise that knowledge is overturn-ing the old rules about strategy and competitionmdashthe foundation of industrializedeconomics has shifted from natural resources to intellectual assets In response manymanagers and management thinkers have proclaimed an era of knowledge manage-ment This has compelled researchers to investigate how knowledge is managed Evi-dence is provided by a variety of studies on knowledge [19 79 82] knowledge process[38 70 76 114] and knowledge management architecture [9 21 105]

Companies attempting to deploy knowledge management may be confused by avariety of efforts under way that go under the name of knowledge management [61]Many companies have tried with mixed success to leverage knowledge assets bycentralizing knowledge management functions or by investing heavily in informationtechnology (IT) [44] It is understandable when confronted with a new business phe-nomenon to look to new management practices for guidance Caught up in the gen-eral fever many managers may assume that knowledge management can improvetheir companies However despite their best efforts most studies have not investi-gated how companies can leverage knowledge for the improved performance It isimportant to distinguish themselves through strategies The key question is not whetherto manage knowledge but how to manage it These strategies should be validated bythe use of further empirical tests

To fill this gap prior research has explored which factors are essential for managingknowledge effectively One challenge is to decipher the relationships among thesefactors Most studies have examined the relationships of knowledge managementenablers processes or performance in isolation For example some research has fo-cused on the relationship between enablers and processes [6 43 114 124] the em-phasis of other studies is on the relationship between enablers and organizationalperformance [8 11 35 104] Researchers and practitioners have not tried an integra-tive model An integrative perspective of the knowledge variables based on relevanttheories is a necessity It is also noted that very few empirical studies adopt a process-oriented perspective of organizational knowledge [90] Knowledge creation or trans-fer would benefit companies more than knowledge itself because knowledge is notprimarily about facts but more about context-specific characteristics [115] For ex-ample Xerox systemizes knowledge creation and transfer processes through strategiccommunities [109] Consequently another challenge is to leverage a process-orientedperspective

The primary objective of this paper is to delineate an integrative view of knowledgemanagement and provide strategic guidelines For this purpose this paper analyzesthe previous empirical studies and attempts to find relationships among knowledgemanagement factors such as enablers processes and organizational performance Anintegrative research model is built from a process-oriented perspective and then testedempirically

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 181

Research Background and Literature Review

Theoretical Background

MANY RESEARCHERS HAVE EMPHASIZED three major factors for managing knowledgeenablers processes and organizational performance [9 21 85] Knowledge manage-ment enablers (or influencing factors) are organizational mechanisms for fostering knowl-edge consistently [57] they can stimulate knowledge creation protect knowledge andfacilitate the sharing of knowledge in an organization [108] Knowledge processes(knowledge management activities) can be thought of as a structured coordination formanaging knowledge effectively [35] Typically knowledge processes include activi-ties such as creation sharing storage and usage [2 9] Whereas knowledge processesrepresent the basic operations of knowledge [105] enablers provide the infrastructurenecessary for the organization to increase the efficiency of knowledge processes [96]Organizational performance may be defined as the degree to which companies achievedits business objectives [28] It may be measured in terms of organizational learningprofitability or other financial benefits in knowledge management [18 104] Withoutmeasurable success passion from employees and managers will vanish [85]

There is a general recognition among academics that knowledge management is across-functional and multifaceted discipline A variety of components make up knowl-edge management and the understanding of their interaction is important a holisticview is very useful [80] To this end an integrative research model is necessary thatis the relationships among knowledge enablers processes and organizational perfor-mance can be identified within the framework of systems thinking Systems thinkingtheory considers problems in their entirety [95] This theory is better able to describecomplex and dynamic characteristics of knowledge management in a systematic fash-ion Therefore our integrative framework will be based on this systems thinking theory

Our primary research focus is on the relationships between knowledge enablersand organizational performance by elaborating on the significance of knowledge pro-cesses as the foundation of organizational advantage [79] The relationship amongthese three components is nothing new it can be found in the input-process-outputmodel by Hackerman and Morris [41] The model assumes that the input factorsaffect output performances through certain kinds of interaction processes knowl-edge management enablers affect organizational performance through knowledgeprocesses This relationship is also explained by the use of the knowledge-chain modelproposed by Holsapple and Singh [51] This model suggests that leadership establishenabling conditions for achieving organizational outcome through the knowledgemanagement activities such as acquisition generation internalization and externali-zation It means that knowledge enablers (eg leadership) affect organizational out-come through knowledge processes

A direct relationship between knowledge processes and organizational performanceis not explored yet Because many factors influence the determination of the organiza-tional performance attempts to trace causality to any single factor such as knowledge

182 LEE AND CHOI

process may be risky In order to understand the effect of the knowledge processes onorganizational performance intermediate outcomes (for example knowledge satis-faction or organizational creativity) may be introduced [18] Intermediate outcomesreflect different aspects of an organizationrsquos performance both financial and nonfi-nancial This incorporation may help confirm that enablers ultimately create businessvalue

In sum this paper proposes a research framework as shown in Figure 1

Previous Empirical Studies

Previous empirical studies have investigated the relationships among knowledgemanagement factors They can be classified into four categories depending on howthey identify the relationships (1) relationships between knowledge enablers (2) re-lationships between knowledge enablers and process (3) relationships between knowl-edge process and organizational performance and (4) relationships among knowledgeenablers processes and organizational performance This comparison may be high-lighted as shown in Figure 2

The studies under the first category focus on the relationships among knowledgeenablers The emphasis is on the examination of the effect of knowledge enablers Toidentify this effect they have investigated various knowledge enablers such as knowl-edge management methods structure and culture For example Bennett and Gabriel[10] analyzed a number of knowledge management methods in view of organiza-tional structure culture size and environment

The second category explores the relationships between knowledge enablers andknowledge processes A central proposition is that knowledge enablers (eg industrycharacteristics or knowledge characteristics) should influence knowledge processes(eg transfer) Zander and Kogut [124] proposed that the transfer of organizationalcapabilities be related to the characteristics of social knowledge they analyzed theeffects of the ease of codifying manufacturing capabilities on its transfer timeAppleyard [6] explored knowledge transfer patterns among various nations and in-dustries Szulanski [114] investigated the relationship between four origins of sticki-ness (characteristics of the knowledge transferred the source the recipient and thecontext in which the transfer takes place) and knowledge transfer Hansen [43] em-ployed the notion of complex knowledge to explain the role of weak ties in transfer-ring knowledge in a multiunit organization

The third category examines the relationships between knowledge enablers andorganizational performance The purpose of these studies is to sharpen the under-standing of the effects of knowledge enablers (eg knowledge management strategy)

Figure 1 An Integrative Research Framework for Studying Knowledge Management

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 183

on organizational performance (eg return on assets [ROA] or return on sales [ROS])Bierly and Chakrabarti [11] tried to identify how knowledge management strategiesaffect organizational performance They analyzed knowledge strategies of 21 USpharmaceutical companies that had been categorized into explorers exploiters lon-ers and innovators Simonin [104] tested the relationships among collaborative expe-rience know-how and achievement of organizational performance He proposed thatthe experience of a firm has to be transformed into know-how before it could improveorganizational performance

The emphasis of the fourth category is on relationships among knowledge enablersknowledge processes and organizational performance The primary objective of thesestudies is to identify and assess knowledge enablers (eg task or infrastructure capa-bilities) and processes (eg creation or their capabilities) for improving organiza-tional performance (eg knowledge satisfaction or organizational effectiveness)Becerra-Fernandez and Sabherwal [8] proposed a contingency framework includingtwo attributes of the organizational subunitrsquos tasksmdashprocess or content orientationand focused or broad domainmdashand linked them to Nonakarsquos knowledge creationprocess [82] The relationship between knowledge creation process and knowledgesatisfaction was also investigated Gold et al [35] analyzed two relationships one

Figure 2 Research Models for Studying Knowledge Management

184 LEE AND CHOI

between infrastructure capabilities and organizational effectiveness and the otherbetween process capabilities and organizational effectiveness Table 1 compares theseprevious studies

Synthesis of Previous Studies

Synthesis of previous studies yields some observations First an integrative model isstill missing Although some studies investigate the relationships among knowledgeenablers processes or organizational performance [8 35] they fail to explore therelationships between enablers and processes simultaneously If managers understandthese relationships in an integrative fashion they can stand a better chance of improv-ing their firmrsquos performance

Second the role of knowledge management processes is not consistent Some stud-ies recognized both knowledge enablers and processes as antecedents of organiza-tional performance [8 35] Other studies recognized knowledge enablers aspreconditions of knowledge processes [6 43 114 124] Therefore the challenge isto clarify the role of knowledge management processes [108]

Third measuring knowledge management performance is still difficult Some stud-ies captured the contribution by the use of knowledge management outcome mea-sures such as knowledge satisfaction [8] whereas others adopted conventionalperformance measures such as ROA [11 104] or organizational effectiveness [35] Itwould appear that the former studies take the relationship between knowledge man-agement outcome and organizational performance for granted although the relation-ship has not been validated The results of the latter studies should be examinedcarefully because the direct relationship between knowledge management processesand organizational performance has not been validated yet [18]

Fourth the knowledge transfer process has been studied extensively [6 43 114124] whereas the other processes such as creation or utilization have received rela-tively little attention In particular some studies have suggested that knowledge cre-ation is most critical for an organizationrsquos long-term success [30] Moreover knowledgetransfer has been assessed by the use of object-perspective measures such as time totransfer [124] number of times of knowledge transfer [6] or percentage of trans-ferred knowledge [43] Recently some researchers have tried to measure knowledgeprocesses themselves [8 35] For example Becerra-Fernandez and Sabherwal [8]measured the capacity for knowledge creation by Nonakarsquos knowledge creation modelnot by the use of creation output such as the number of created ideas or patents

A Research Model

OUR OBJECTIVE IS NEITHER TO PROPOSE a model that delineates all of the relation-ships underlying knowledge management nor to generate a longer list of possibleknowledge enablers or processes that affect organizational performance Therefore

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 185

Tabl

e 1

A C

ompa

riso

n of

Pre

viou

s St

udie

s

Org

aniz

atio

nal

Stud

yK

M e

nabl

ers

KM

pro

cess

espe

rfor

man

ceFi

ndin

gs

Rel

atio

nshi

p am

ong

enab

lers

Ben

net a

nd G

abrie

l [10

]S

truc

ture

NA

NA

Effe

ct o

f cha

nge-

frie

ndly

cul

ture

Cul

ture

on th

e nu

mbe

r of

KM

met

hods

Siz

eem

ploy

ed

Env

ironm

ent

KM

met

ho

d

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

roce

sses

Zan

der

and

Kog

ut [1

24]

Cha

ract

eris

tics

ofTr

ansf

er (

tim

e to

NA

Cod

ifiab

ility

tea

chab

ility

and

soci

etal

kno

wle

dge

tran

sfer

)pa

ralle

l dev

elop

men

t hav

esi

gnifi

cant

effe

cts

on th

e tim

eto

tran

sfer

App

leya

rd [6

]In

dust

ry a

ndTr

ansf

er (

nu

mb

er o

fN

Apu

blic

sou

rces

of k

now

ledg

ena

tiona

l cha

ract

eris

tics

tim

es t

he

resp

on

den

tsar

e m

uch

mor

e pr

eval

ent i

np

rovi

de

and

rec

eive

know

ledg

e tr

ansf

er in

kno

wle

dg

e in

a g

iven

sem

icon

duct

ors

than

in th

ep

erio

d)

stee

l ind

ustr

yP

ublic

sou

rces

of t

echn

ical

know

ledg

e pl

ay a

larg

er r

ole

inkn

owle

dge

tran

sfer

in J

apan

than

in th

e U

nite

d S

tate

s(c

onti

nues

)

186 LEE AND CHOI

Tabl

e 1

(C

ontin

ued)

Org

aniz

atio

nal

Stud

yK

M e

nabl

ers

KM

pro

cess

espe

rfor

man

ceFi

ndin

gs

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

roce

sses

(co

ntin

ued)

Szu

lans

ki [1

14]

Cha

ract

eris

tics

ofTr

ansf

er (

fou

r-st

age

NA

Rec

ipie

ntrsquos

lack

of a

bsor

ptiv

eth

e kn

owle

dge

tran

sfer

pro

cess

es)

capa

city

cau

sal a

mbi

guity

and

tran

sfer

red

sour

cean

ard

uous

ness

of t

here

cipi

ent c

onte

xt

rela

tions

hip

are

the

maj

orim

pedi

men

ts to

kno

wle

dge

tran

sfer

Han

sen

[43]

Wea

k tie

s (d

ista

ntTr

ansf

er (

per

cen

tag

eN

AW

eak

ties

impe

de th

e tr

ansf

eran

d in

freq

uent

of

a p

roje

ctrsquos

to

tal

of c

ompl

ex k

now

ledg

ere

latio

nshi

ps)

kno

wle

dg

e th

atK

now

ledg

eco

me

fro

m o

ther

char

acte

rist

ics

div

isio

ns)

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

erfo

rman

ce

Bie

rly

and

KM

str

ateg

yN

AR

OS

Inno

vato

rs a

nd e

xplo

rers

are

Cha

krab

arti

[11]

RO

Am

ore

prof

itabl

e th

an e

xplo

iters

and

lone

rs

Sim

onin

[104

]C

olla

bora

tive

NA

Tan

gib

le b

enef

its

Col

labo

rativ

e kn

ow-h

ow a

llow

sex

perie

nce

(RO

I R

OA

)fir

ms

to a

chie

ve g

reat

erC

olla

bora

tive

Inta

ng

ible

ben

efit

sor

gani

zatio

nal b

enef

its

know

-how

colla

bora

tive

expe

rien

ce a

lone

does

not

ens

ure

that

a fi

rm w

illbe

nefit

from

a c

olla

bora

tion

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 187

Rel

atio

nshi

p am

ong

know

ledg

e en

able

rs p

roce

sses

and

per

form

ance

Bec

erra

-Fer

nand

ez a

ndTa

sk (

proc

ess

orC

reat

ion

(soc

ializ

atio

nK

M s

atis

fact

ion

Soc

ializ

atio

n is

sui

tabl

e fo

rS

abhe

rwal

[8]

cont

ent o

rien

tatio

nex

tern

aliz

atio

nbr

oad

and

proc

ess-

orie

nted

focu

sed

orco

mbi

natio

nta

sks

ext

erna

lizat

ion

for

broa

d do

mai

n)

inte

rnal

izat

ion)

fo

cuse

d an

d co

nten

t-or

ient

edta

sks

com

bina

tion

for

broa

dan

d co

nten

t-or

ient

ed ta

sks

and

inte

rnal

izat

ion

for

focu

ses

and

proc

ess-

orie

nted

task

sco

mbi

natio

n an

dex

tern

aliz

atio

n af

fect

know

ledg

e sa

tisfa

ctio

n

Gol

d et

al

[35]

Infr

astr

uctu

re c

apab

ility

Pro

cess

cap

abili

tyO

rgan

izat

ion

alIn

fras

truc

ture

and

pro

cess

(tec

hnol

ogy

str

uctu

re

(acq

uisi

tion

con

vers

ion

effe

ctiv

enes

sca

pabi

litie

s co

ntrib

ute

to th

ecu

lture

)ap

plic

atio

n p

rote

ctio

n)

achi

evem

ent o

f org

aniz

atio

nal

effe

ctiv

enes

s

Not

e B

oldf

ace

type

ind

icat

es d

epen

dent

var

iabl

es

188 LEE AND CHOI

our model highlights a few major factors that can explain a large proportion of thevariance in knowledge management

Variables

Enablers

A variety of knowledge management enablers have been addressed in the literature[57 70 97] Among these enablers organizational culture structure people and ITare incorporated into our research model Organizational culture is the most impor-tant factor for successful knowledge management [15 20 21 35] Culture definesnot only what knowledge is valued but also what knowledge must be kept inside theorganization for sustained innovative advantage [71] Organizations should establishan appropriate culture that encourages people to create and share knowledge withinan organization [49 70] This study focuses on collaboration trust and learning onthe basis of the concept of care [29] Care is a key enabler for organizational relation-ships [68] When organizational relationships are fostered through care knowledgecan be created and shared

The organizational structure within an organization may encourage or inhibit knowl-edge management [35 47 82] For example Ichijo et al [57] insisted that firmsshould maintain consistency between their structures to put their knowledge to useOur study includes two key structural factors such as centralization and formalization[77] They are recognized as key variables underlying the structural construct More-over their effects on knowledge management within organizations are widely recog-nized to be potent [29 59 72 91]

People are at the heart of creating organizational knowledge [15 49 80] It is peoplewho create and share knowledge Therefore managing people who are willing tocreate and share knowledge is important [85] Knowledge and competence can beacquired by admitting new people with desirable skills [108] In particular T-shapedskills embodied in employees are most often associated with core capability [56 6070] T-shaped skills may enable individual specialists to have synergistic conversa-tions with one another [74]

Technology contributes to knowledge management [35] This technology infra-structure includes IT and its capabilities [90 99] IT is widely employed to connectpeople with reusable codified knowledge and it facilitates conversations to createnew knowledge Among technology-related variables this study focuses on IT sup-port [108] ITs allow an organization to create share store and use knowledge [70]Therefore the support of IT is essential for initiating and carrying out knowledgemanagement

Enablers may be structured based upon a socio-technical theory [86] This theorydescribes an organization from the social and technical perspectives The two per-spectives are not unique to management information systems (MIS) research [12]they are made up of two jointly independent but correlative interacting componentsOrganizational culture organizational structure and people are social enablers IT is

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 189

a technical enabler For the sake of clarity we consider the impact of each knowledgeenabler independently

Processes

A number of studies have addressed knowledge management processes they divideknowledge management into several processes For example Alavi and Leidner [2]considered four processes such as creation storage transfer and application Theseprocesses are often concurrent and not always in a linear sequence [9]

Among these processes creation-related activities (for example creation [2] orconstruction [21]) become important because knowledge creation is a strategic weaponin todayrsquos global marketplace without the constant creation of knowledge a businessis condemned to obsolescence [83 87] Knowledge creation is a continuous processwhereby individuals and groups within a firm and between firms share tacit and ex-plicit knowledge [82] Although a great deal has been discussed about the importanceof knowledge creation there is relatively little empirical evidence [90] Thereforethe emphasis of this study is on knowledge creation

To explore knowledge creation our study adopts the SECI (socializationexternalization combination internalization) model by Nonaka and Takeuchi [82]for the following reasons First their work has become widely accepted [98] it hasbeen used in many research areas such as organizational learning new product devel-opment and IT [98 99] Second their model includes not only knowledge creationbut also knowledge transfer The transfer of existing knowledge and the creation ofnew knowledge are important and both of them should be considered in knowledgemanagement [69] Their SECI model is made up of four intertwined activity modessocialization (S) externalization (E) combination (C) and internalization (I) Social-ization converts tacit knowledge into new tacit knowledge through social interactionsamong members Externalization codifies tacit knowledge into explicit concepts Com-bination converts explicit knowledge into more systematic sets by combining keypieces Internalization embodies explicit knowledge into tacit knowledge

Intermediate Outcome

In order to achieve a better understanding of knowledge management performancecompanies should attempt to link knowledge processes with intermediate outcomes[18] An important intermediate outcome is organizational creativity which pro-vides a key to the understanding of organizational effectiveness and survival [122]Our model incorporates organizational creativity because it is the seed of all innova-tion [5] and at the very heart of knowledge management [40] Organizational cre-ativity transforms knowledge into business value Neglecting organizational creativitycan quickly undermine a business The relationship between knowledge creationand organizational creativity has received relatively little attention despite its highpotential [119]

190 LEE AND CHOI

Organizational Performance

Measuring organizational performance is not a trivial task because it strongly affectsthe behavior of managers and employees The ultimate test of any business is whetherit leads to measurable improvements in organizational performance

Methods for measuring organizational performance in knowledge management canbe categorized into four groups financial measures [11] intellectual capital [110]tangible and intangible benefits [104] and balanced scorecard [63] This study adoptsa specific measure which is developed and validated by Deshpande et al [22] andDrew [25] This measure can be thought of as a variation of the balanced scorecardmethod The balanced scorecard retains financial performance and supplements itwith measures on the drivers of future potential In addition it is more useful thanintellectual capital or a tangible and intangible approach because it shows cause andeffect links between knowledge components and organization strategies [63]

In summary our empirical research model illustrates the relationship among vari-ables as shown in Figure 3 In total the model consists of 13 variables

Hypotheses

Our hypotheses are largely derived from theoretical statements made in the litera-ture on knowledge management We present our hypotheses through the followingvariables

Collaboration

Collaboration may be defined as the degree to which people in a group actively helpone another in their work [55] Collaborative culture affects knowledge creation throughincreasing knowledge exchange [68 79] Exchanging knowledge among differentmembers is a prerequisite for knowledge creation Collaborative culture fosters thistype of exchange by reducing fear and increasing openness to other members Forexample Zucker et al [126] confirmed the significance of collaborative culture inknowledge creation by examining the biotechnology industry Collaboration betweenorganizational members also tightens individual differences [70] It can help peopledevelop a shared understanding about an organizationrsquos external and internal envi-ronments through supportive and reflective communication Without shared under-standing among organizational members little knowledge is ever created [30 47]We do not have a priori reason to expect a different relationship

H1 There is a positive relationship between collaboration and knowledge cre-ation process

Trust

Trust can be defined as maintaining reciprocal faith in each other in terms of intentionand behaviors [67] Trust may facilitate open substantive and influential knowledge

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 191

exchange [81 85] When their relationships are high in trust people are more willingto participate in knowledge exchange [79] Szulanski [114] empirically found thatthe lack of trust among employees is one of the key barriers against knowledge ex-change The increase in knowledge exchange brought on by mutual trust results inknowledge creation Trust also encourages a climate conducive to better knowledgecreation by alleviating the fear of risk The presence of a high level of trust can reducethis risk [81 92 100] Trust is also critical in a cross-functional or interorganizationalteam because withholding information because of a lack of trust can be especiallyharmful to knowledge creation [47 59] Therefore we would expect the followingrelationship to hold true

H2 There is a positive relationship between trust and knowledge creation process

Learning

Learning can be defined as the degree to which it is encouraged in organizations [55]The emphasis on learning infuses an organization with new knowledge [17] Learningis the acquisition of new knowledge by people who are able and willing to apply thatknowledge in making decisions or influencing others [78] Through the emphasis onlearning and development organizations can help individuals play more active rolesin knowledge creation Kanevsky and Housel [62] insisted that the amount of timespent on learning is positively related with the amount of knowledge For successfulknowledge creation organizations should develop a deeply ingrained learning culture

Figure 3 A Research Model

192 LEE AND CHOI

[88] and provide various learning means such as education training and mentoring[112 113] For example Nucor [39] which has been the most innovative steel com-pany in the United States built a knowledge creation foundation by investing in con-tinuous and multifunctional training programs Hence we hypothesize

H3 There is a positive relationship between learning and knowledge creationprocess

Centralization

Centralization refers to the locus of decision authority and control within an organi-zational entity [14 27] The concentration of decision-making authority inevitablyreduces creative solutions whereas the dispersion of power facilitates spontaneityexperimentation and the freedom of expression which are the lifeblood of knowl-edge creation [37] Moreover centralized structure hinders interdepartmental com-munication and frequent sharing of ideas [122] due to time-consuming communicationchannels [10] it also causes distortion and discontinuousness of ideas [108] Withouta constant flow of communication and ideas knowledge creation does not occur Adecentralized organizational structure has been found to facilitate an environmentwhere employees participate in knowledge building process more spontaneously [52]Participatory work environments foster knowledge creation by motivating organiza-tional membersrsquo involvements Therefore decreased centralization in the form of lo-cus of authority can lead to increased creation of knowledge [106 108 115] Weadvance the fourth hypothesis

H4 There is a negative relationship between centralization and knowledge cre-ation process

Formalization

Formalization refers to the degree to which decisions and working relationships aregoverned by formal rules standard policies and procedures [49 89] Knowledgecreation requires flexibility and less emphasis on work rules [57 73] The range ofnew ideas seems to be restricted when strict formal rules dominate an organizationFlexibility can accommodate better ways of doing things [37] Therefore the in-creased flexibility in an organizational structure can result in increased creation ofknowledge Knowledge creation also requires variation [121] In order to be moreadaptable when unforeseen problems arise an organization may accommodate varia-tion in process and structure Low formalization permits openness and variation whichencourage new ideas and behaviors [17] Knowledge creation is also likely to beencouraged through unhindered communications and interactions [10] Formalitystifles the communication and interaction necessary to create knowledge Lack offormal structure tends to enable organizational members to communicate and interactwith one another to create knowledge [59] Hence we hypothesize

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 193

H5 There is a negative relationship between formalization and knowledge cre-ation process

T-Shaped Skills

T-shaped skills are both deep (the vertical part of the ldquoTrdquo) and broad (the horizontalpart of the ldquoTrdquo) that is their possessors can explore particular knowledge domainsand their various applications in particular products [70] For example persons withT-shaped skills not only have a deep knowledge of a discipline (like ceramic materi-als engineering) but also know how their discipline interacts with other disciplines(such as polymer processing) [56] People with T-shaped skills are extremely valu-able for creating knowledge because they can integrate diverse knowledge assets [70]They have the ability both to combine theoretical and practical knowledge and to seehow their branch of knowledge interacts with other branches Therefore they canexpand their competence across several functional branch areas and thus create newknowledge [60 74]

H6 There is a positive relationship between the presence of the organizationalmembers with T-shaped skills and knowledge creation process

IT Support

IT support means the degree to which knowledge management is supported by theuse of ITs [35] Many researchers have found that IT is a crucial element for knowl-edge creation [19 36 39] IT affects knowledge in a variety of ways First IT facili-tates rapid collection storage and exchange of knowledge on a scale not practicablein the past thereby assisting the knowledge creation process [92] Second a well-developed technology integrates fragmented flows of knowledge [35] This integra-tion can eliminate barriers to communication among departments in organizationThird IT fosters all modes of knowledge creation and is not limited to the transfer ofexplicit knowledge [90 91 99] For instance InfoTESTrsquos enhanced product realiza-tion (EPR) project employs electronic whiteboarding and videoconferencing to en-hance exchanges of tacit knowledge [91] Thus we hypothesize

H7 There is a positive relationship between IT support and knowledge creationprocess

Organizational Creativity

Organizational creativity is the capability of creating valuable and useful productsservices ideas or procedures by individuals working together in a complex socialsystem [5 122] Knowledge plays an important role in the ability of the organizationto be creative [119] Thus organizations with better knowledge diffusion and creat-ing mechanisms are more intelligent [34] Organizational creativity also connectsand rearranges knowledge to create new often surprising ideas that others judge to be

194 LEE AND CHOI

useful [65] Creativity is not necessarily related to the amount of knowledge that anemployee possesses but rather the way in which knowledge is created and shared [4]The processes of knowledge creation unleash organizational creativity Naturallyorganizational creativity has a strong link with knowledge creation [119]

H8 There is a positive relationship between the knowledge creation process andorganizational creativity

Organizational Performance

In our study organizational performance is assessed by the use of global output mea-sures such as market share profitability growth rate innovativeness successfulnessand the size of business in comparison with key competitors [22 25] In a knowl-edge-based economy organizational creativity represents a dramatic organizationalchange Robinson and Stern [93] insisted that the tangible results of corporate cre-ativity are the organizational change such as improvements (changes to what is al-ready done) and innovations (entirely new activities for the company) Withoutcreativity organizations may fail to adapt to changing internal and external condi-tions [88] and thus lose their knowledge advantage Typically the goals of organiza-tional change include the various aspects of organizational performance such asorganizational effectiveness survival improvement or innovation Organizationalperformance can be thought of as the output of a process that encourages creativity[97] Thus improvements of creativity might lead to better organizational perfor-mance [18 88 102] We hypothesize that

H9 There is a positive relationship between organizational creativity and orga-nizational performance

Sample and Measures

SAMPLES WERE RESTRICTED TO THE LISTED COMPANIES in order to include majorcompanies in Korea Annual Corporation Reports by Maeil Business Newspaper [75]is the source for sampling because it analyzes all listed companies in the Korea StockExchange Therefore the unit of analysis in this study is the organization We adoptedboth interviews and mail surveys Interviews were used to investigate the currentdetailed status of knowledge management This investigation included knowledgemanagement practices such as the number of communities of practice the rate of useof the knowledge management system and the cost of investment in knowledge man-agement activities Although interview data is not analyzed statistically they werevaluable for our interpretation

After the interview a questionnaire-based survey was conducted Questionnaireswere administered to a total of 1425 middle managers in 147 organizations Depend-ing on each individual firmrsquos size five to 15 middle managers were surveyed fromeach firm Middle managers were reached through their CEOs or CIOs A typical jobtitle of a middle manager was department chief Middle managers were surveyed

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 195

because they played key roles in managing knowledge Middle managers are posi-tioned at the intersection of the vertical and horizontal flows of knowledge Thusthey can synthesize the tacit knowledge of both top managers and frontline employ-ees make it explicit and incorporate it into new products and services [82]

A multiple-item method was used to construct the questionnaires Each item wasbased on a six-point Likert scale from ldquovery lowrdquo to ldquovery highrdquo Likert scales asgenerally used tend to underestimate the extreme positions [3] Respondents are re-luctant to express an extreme position even if they have it They tend to please theinterviewer appear helpful or respond in what they perceive to be a socially accept-able answer Resorting to a scale without a midpoint seems to help mollify this socialdesirability bias without changing the direction of opinion [32] The six-point Likertscale avoids a midpoint which prevents respondents from using a neutral defaultoption [5] The questionnaires were written in Korean

Research constructs were operationalized on the basis of related studies and pilottests The operational definitions of instruments and their related literature are sum-marized in Appendix A Most of the research constructs have already been validatedand used for other studies on knowledge management organizational design learn-ing or IT management For example formalization items have already been vali-dated and used by Caruana et al [14] and Rapert and Wren [89] Self-reported itemshave been used to assess organizational performance [22 25] Although these itemsdo not present a fully balanced scorecard they are effective for comparing businessunits and industries [25] Questionnaire items for the knowledge creation processwhich were used in this study had been validated and used by Nonaka et al [83]

Analysis

Sample Characteristics

IN TOTAL 451 QUESTIONNAIRES FROM 63 out of 147 firms were returned (43 percentresponse rate) The rates from individual firms ranged from 23 to 100 percent Due toincomplete data 25 responses from five firms were eliminated Consequently 426responses from 58 firms were analyzed Table 2 summarizes the respondent charac-teristics in terms of industry type departments total sales revenue and number oftotal employees

Samples are divided into three industry types manufacturing service and finan-cial business (banking finance insurance) The majority of these firms are in theservice industry Thirty-two firms have annual total sales revenue of $1 billion ormore and 31 firms have 1000 employees or more As mentioned previously sampleswere collected from various middle managers

Reliability and Validity Analysis

Table 3 presents the results of reliability and validity tests An analysis was performedon the 36 items that measured the components of knowledge enablers other analyses

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

180 LEE AND CHOI

IN RECENT YEARS IT SEEMS AS THOUGH businesses that could capture the knowledgeembedded in their organization would own the future Companies that isolate knowl-edge management risk losing its benefits It is no surprise that knowledge is overturn-ing the old rules about strategy and competitionmdashthe foundation of industrializedeconomics has shifted from natural resources to intellectual assets In response manymanagers and management thinkers have proclaimed an era of knowledge manage-ment This has compelled researchers to investigate how knowledge is managed Evi-dence is provided by a variety of studies on knowledge [19 79 82] knowledge process[38 70 76 114] and knowledge management architecture [9 21 105]

Companies attempting to deploy knowledge management may be confused by avariety of efforts under way that go under the name of knowledge management [61]Many companies have tried with mixed success to leverage knowledge assets bycentralizing knowledge management functions or by investing heavily in informationtechnology (IT) [44] It is understandable when confronted with a new business phe-nomenon to look to new management practices for guidance Caught up in the gen-eral fever many managers may assume that knowledge management can improvetheir companies However despite their best efforts most studies have not investi-gated how companies can leverage knowledge for the improved performance It isimportant to distinguish themselves through strategies The key question is not whetherto manage knowledge but how to manage it These strategies should be validated bythe use of further empirical tests

To fill this gap prior research has explored which factors are essential for managingknowledge effectively One challenge is to decipher the relationships among thesefactors Most studies have examined the relationships of knowledge managementenablers processes or performance in isolation For example some research has fo-cused on the relationship between enablers and processes [6 43 114 124] the em-phasis of other studies is on the relationship between enablers and organizationalperformance [8 11 35 104] Researchers and practitioners have not tried an integra-tive model An integrative perspective of the knowledge variables based on relevanttheories is a necessity It is also noted that very few empirical studies adopt a process-oriented perspective of organizational knowledge [90] Knowledge creation or trans-fer would benefit companies more than knowledge itself because knowledge is notprimarily about facts but more about context-specific characteristics [115] For ex-ample Xerox systemizes knowledge creation and transfer processes through strategiccommunities [109] Consequently another challenge is to leverage a process-orientedperspective

The primary objective of this paper is to delineate an integrative view of knowledgemanagement and provide strategic guidelines For this purpose this paper analyzesthe previous empirical studies and attempts to find relationships among knowledgemanagement factors such as enablers processes and organizational performance Anintegrative research model is built from a process-oriented perspective and then testedempirically

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 181

Research Background and Literature Review

Theoretical Background

MANY RESEARCHERS HAVE EMPHASIZED three major factors for managing knowledgeenablers processes and organizational performance [9 21 85] Knowledge manage-ment enablers (or influencing factors) are organizational mechanisms for fostering knowl-edge consistently [57] they can stimulate knowledge creation protect knowledge andfacilitate the sharing of knowledge in an organization [108] Knowledge processes(knowledge management activities) can be thought of as a structured coordination formanaging knowledge effectively [35] Typically knowledge processes include activi-ties such as creation sharing storage and usage [2 9] Whereas knowledge processesrepresent the basic operations of knowledge [105] enablers provide the infrastructurenecessary for the organization to increase the efficiency of knowledge processes [96]Organizational performance may be defined as the degree to which companies achievedits business objectives [28] It may be measured in terms of organizational learningprofitability or other financial benefits in knowledge management [18 104] Withoutmeasurable success passion from employees and managers will vanish [85]

There is a general recognition among academics that knowledge management is across-functional and multifaceted discipline A variety of components make up knowl-edge management and the understanding of their interaction is important a holisticview is very useful [80] To this end an integrative research model is necessary thatis the relationships among knowledge enablers processes and organizational perfor-mance can be identified within the framework of systems thinking Systems thinkingtheory considers problems in their entirety [95] This theory is better able to describecomplex and dynamic characteristics of knowledge management in a systematic fash-ion Therefore our integrative framework will be based on this systems thinking theory

Our primary research focus is on the relationships between knowledge enablersand organizational performance by elaborating on the significance of knowledge pro-cesses as the foundation of organizational advantage [79] The relationship amongthese three components is nothing new it can be found in the input-process-outputmodel by Hackerman and Morris [41] The model assumes that the input factorsaffect output performances through certain kinds of interaction processes knowl-edge management enablers affect organizational performance through knowledgeprocesses This relationship is also explained by the use of the knowledge-chain modelproposed by Holsapple and Singh [51] This model suggests that leadership establishenabling conditions for achieving organizational outcome through the knowledgemanagement activities such as acquisition generation internalization and externali-zation It means that knowledge enablers (eg leadership) affect organizational out-come through knowledge processes

A direct relationship between knowledge processes and organizational performanceis not explored yet Because many factors influence the determination of the organiza-tional performance attempts to trace causality to any single factor such as knowledge

182 LEE AND CHOI

process may be risky In order to understand the effect of the knowledge processes onorganizational performance intermediate outcomes (for example knowledge satis-faction or organizational creativity) may be introduced [18] Intermediate outcomesreflect different aspects of an organizationrsquos performance both financial and nonfi-nancial This incorporation may help confirm that enablers ultimately create businessvalue

In sum this paper proposes a research framework as shown in Figure 1

Previous Empirical Studies

Previous empirical studies have investigated the relationships among knowledgemanagement factors They can be classified into four categories depending on howthey identify the relationships (1) relationships between knowledge enablers (2) re-lationships between knowledge enablers and process (3) relationships between knowl-edge process and organizational performance and (4) relationships among knowledgeenablers processes and organizational performance This comparison may be high-lighted as shown in Figure 2

The studies under the first category focus on the relationships among knowledgeenablers The emphasis is on the examination of the effect of knowledge enablers Toidentify this effect they have investigated various knowledge enablers such as knowl-edge management methods structure and culture For example Bennett and Gabriel[10] analyzed a number of knowledge management methods in view of organiza-tional structure culture size and environment

The second category explores the relationships between knowledge enablers andknowledge processes A central proposition is that knowledge enablers (eg industrycharacteristics or knowledge characteristics) should influence knowledge processes(eg transfer) Zander and Kogut [124] proposed that the transfer of organizationalcapabilities be related to the characteristics of social knowledge they analyzed theeffects of the ease of codifying manufacturing capabilities on its transfer timeAppleyard [6] explored knowledge transfer patterns among various nations and in-dustries Szulanski [114] investigated the relationship between four origins of sticki-ness (characteristics of the knowledge transferred the source the recipient and thecontext in which the transfer takes place) and knowledge transfer Hansen [43] em-ployed the notion of complex knowledge to explain the role of weak ties in transfer-ring knowledge in a multiunit organization

The third category examines the relationships between knowledge enablers andorganizational performance The purpose of these studies is to sharpen the under-standing of the effects of knowledge enablers (eg knowledge management strategy)

Figure 1 An Integrative Research Framework for Studying Knowledge Management

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 183

on organizational performance (eg return on assets [ROA] or return on sales [ROS])Bierly and Chakrabarti [11] tried to identify how knowledge management strategiesaffect organizational performance They analyzed knowledge strategies of 21 USpharmaceutical companies that had been categorized into explorers exploiters lon-ers and innovators Simonin [104] tested the relationships among collaborative expe-rience know-how and achievement of organizational performance He proposed thatthe experience of a firm has to be transformed into know-how before it could improveorganizational performance

The emphasis of the fourth category is on relationships among knowledge enablersknowledge processes and organizational performance The primary objective of thesestudies is to identify and assess knowledge enablers (eg task or infrastructure capa-bilities) and processes (eg creation or their capabilities) for improving organiza-tional performance (eg knowledge satisfaction or organizational effectiveness)Becerra-Fernandez and Sabherwal [8] proposed a contingency framework includingtwo attributes of the organizational subunitrsquos tasksmdashprocess or content orientationand focused or broad domainmdashand linked them to Nonakarsquos knowledge creationprocess [82] The relationship between knowledge creation process and knowledgesatisfaction was also investigated Gold et al [35] analyzed two relationships one

Figure 2 Research Models for Studying Knowledge Management

184 LEE AND CHOI

between infrastructure capabilities and organizational effectiveness and the otherbetween process capabilities and organizational effectiveness Table 1 compares theseprevious studies

Synthesis of Previous Studies

Synthesis of previous studies yields some observations First an integrative model isstill missing Although some studies investigate the relationships among knowledgeenablers processes or organizational performance [8 35] they fail to explore therelationships between enablers and processes simultaneously If managers understandthese relationships in an integrative fashion they can stand a better chance of improv-ing their firmrsquos performance

Second the role of knowledge management processes is not consistent Some stud-ies recognized both knowledge enablers and processes as antecedents of organiza-tional performance [8 35] Other studies recognized knowledge enablers aspreconditions of knowledge processes [6 43 114 124] Therefore the challenge isto clarify the role of knowledge management processes [108]

Third measuring knowledge management performance is still difficult Some stud-ies captured the contribution by the use of knowledge management outcome mea-sures such as knowledge satisfaction [8] whereas others adopted conventionalperformance measures such as ROA [11 104] or organizational effectiveness [35] Itwould appear that the former studies take the relationship between knowledge man-agement outcome and organizational performance for granted although the relation-ship has not been validated The results of the latter studies should be examinedcarefully because the direct relationship between knowledge management processesand organizational performance has not been validated yet [18]

Fourth the knowledge transfer process has been studied extensively [6 43 114124] whereas the other processes such as creation or utilization have received rela-tively little attention In particular some studies have suggested that knowledge cre-ation is most critical for an organizationrsquos long-term success [30] Moreover knowledgetransfer has been assessed by the use of object-perspective measures such as time totransfer [124] number of times of knowledge transfer [6] or percentage of trans-ferred knowledge [43] Recently some researchers have tried to measure knowledgeprocesses themselves [8 35] For example Becerra-Fernandez and Sabherwal [8]measured the capacity for knowledge creation by Nonakarsquos knowledge creation modelnot by the use of creation output such as the number of created ideas or patents

A Research Model

OUR OBJECTIVE IS NEITHER TO PROPOSE a model that delineates all of the relation-ships underlying knowledge management nor to generate a longer list of possibleknowledge enablers or processes that affect organizational performance Therefore

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 185

Tabl

e 1

A C

ompa

riso

n of

Pre

viou

s St

udie

s

Org

aniz

atio

nal

Stud

yK

M e

nabl

ers

KM

pro

cess

espe

rfor

man

ceFi

ndin

gs

Rel

atio

nshi

p am

ong

enab

lers

Ben

net a

nd G

abrie

l [10

]S

truc

ture

NA

NA

Effe

ct o

f cha

nge-

frie

ndly

cul

ture

Cul

ture

on th

e nu

mbe

r of

KM

met

hods

Siz

eem

ploy

ed

Env

ironm

ent

KM

met

ho

d

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

roce

sses

Zan

der

and

Kog

ut [1

24]

Cha

ract

eris

tics

ofTr

ansf

er (

tim

e to

NA

Cod

ifiab

ility

tea

chab

ility

and

soci

etal

kno

wle

dge

tran

sfer

)pa

ralle

l dev

elop

men

t hav

esi

gnifi

cant

effe

cts

on th

e tim

eto

tran

sfer

App

leya

rd [6

]In

dust

ry a

ndTr

ansf

er (

nu

mb

er o

fN

Apu

blic

sou

rces

of k

now

ledg

ena

tiona

l cha

ract

eris

tics

tim

es t

he

resp

on

den

tsar

e m

uch

mor

e pr

eval

ent i

np

rovi

de

and

rec

eive

know

ledg

e tr

ansf

er in

kno

wle

dg

e in

a g

iven

sem

icon

duct

ors

than

in th

ep

erio

d)

stee

l ind

ustr

yP

ublic

sou

rces

of t

echn

ical

know

ledg

e pl

ay a

larg

er r

ole

inkn

owle

dge

tran

sfer

in J

apan

than

in th

e U

nite

d S

tate

s(c

onti

nues

)

186 LEE AND CHOI

Tabl

e 1

(C

ontin

ued)

Org

aniz

atio

nal

Stud

yK

M e

nabl

ers

KM

pro

cess

espe

rfor

man

ceFi

ndin

gs

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

roce

sses

(co

ntin

ued)

Szu

lans

ki [1

14]

Cha

ract

eris

tics

ofTr

ansf

er (

fou

r-st

age

NA

Rec

ipie

ntrsquos

lack

of a

bsor

ptiv

eth

e kn

owle

dge

tran

sfer

pro

cess

es)

capa

city

cau

sal a

mbi

guity

and

tran

sfer

red

sour

cean

ard

uous

ness

of t

here

cipi

ent c

onte

xt

rela

tions

hip

are

the

maj

orim

pedi

men

ts to

kno

wle

dge

tran

sfer

Han

sen

[43]

Wea

k tie

s (d

ista

ntTr

ansf

er (

per

cen

tag

eN

AW

eak

ties

impe

de th

e tr

ansf

eran

d in

freq

uent

of

a p

roje

ctrsquos

to

tal

of c

ompl

ex k

now

ledg

ere

latio

nshi

ps)

kno

wle

dg

e th

atK

now

ledg

eco

me

fro

m o

ther

char

acte

rist

ics

div

isio

ns)

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

erfo

rman

ce

Bie

rly

and

KM

str

ateg

yN

AR

OS

Inno

vato

rs a

nd e

xplo

rers

are

Cha

krab

arti

[11]

RO

Am

ore

prof

itabl

e th

an e

xplo

iters

and

lone

rs

Sim

onin

[104

]C

olla

bora

tive

NA

Tan

gib

le b

enef

its

Col

labo

rativ

e kn

ow-h

ow a

llow

sex

perie

nce

(RO

I R

OA

)fir

ms

to a

chie

ve g

reat

erC

olla

bora

tive

Inta

ng

ible

ben

efit

sor

gani

zatio

nal b

enef

its

know

-how

colla

bora

tive

expe

rien

ce a

lone

does

not

ens

ure

that

a fi

rm w

illbe

nefit

from

a c

olla

bora

tion

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 187

Rel

atio

nshi

p am

ong

know

ledg

e en

able

rs p

roce

sses

and

per

form

ance

Bec

erra

-Fer

nand

ez a

ndTa

sk (

proc

ess

orC

reat

ion

(soc

ializ

atio

nK

M s

atis

fact

ion

Soc

ializ

atio

n is

sui

tabl

e fo

rS

abhe

rwal

[8]

cont

ent o

rien

tatio

nex

tern

aliz

atio

nbr

oad

and

proc

ess-

orie

nted

focu

sed

orco

mbi

natio

nta

sks

ext

erna

lizat

ion

for

broa

d do

mai

n)

inte

rnal

izat

ion)

fo

cuse

d an

d co

nten

t-or

ient

edta

sks

com

bina

tion

for

broa

dan

d co

nten

t-or

ient

ed ta

sks

and

inte

rnal

izat

ion

for

focu

ses

and

proc

ess-

orie

nted

task

sco

mbi

natio

n an

dex

tern

aliz

atio

n af

fect

know

ledg

e sa

tisfa

ctio

n

Gol

d et

al

[35]

Infr

astr

uctu

re c

apab

ility

Pro

cess

cap

abili

tyO

rgan

izat

ion

alIn

fras

truc

ture

and

pro

cess

(tec

hnol

ogy

str

uctu

re

(acq

uisi

tion

con

vers

ion

effe

ctiv

enes

sca

pabi

litie

s co

ntrib

ute

to th

ecu

lture

)ap

plic

atio

n p

rote

ctio

n)

achi

evem

ent o

f org

aniz

atio

nal

effe

ctiv

enes

s

Not

e B

oldf

ace

type

ind

icat

es d

epen

dent

var

iabl

es

188 LEE AND CHOI

our model highlights a few major factors that can explain a large proportion of thevariance in knowledge management

Variables

Enablers

A variety of knowledge management enablers have been addressed in the literature[57 70 97] Among these enablers organizational culture structure people and ITare incorporated into our research model Organizational culture is the most impor-tant factor for successful knowledge management [15 20 21 35] Culture definesnot only what knowledge is valued but also what knowledge must be kept inside theorganization for sustained innovative advantage [71] Organizations should establishan appropriate culture that encourages people to create and share knowledge withinan organization [49 70] This study focuses on collaboration trust and learning onthe basis of the concept of care [29] Care is a key enabler for organizational relation-ships [68] When organizational relationships are fostered through care knowledgecan be created and shared

The organizational structure within an organization may encourage or inhibit knowl-edge management [35 47 82] For example Ichijo et al [57] insisted that firmsshould maintain consistency between their structures to put their knowledge to useOur study includes two key structural factors such as centralization and formalization[77] They are recognized as key variables underlying the structural construct More-over their effects on knowledge management within organizations are widely recog-nized to be potent [29 59 72 91]

People are at the heart of creating organizational knowledge [15 49 80] It is peoplewho create and share knowledge Therefore managing people who are willing tocreate and share knowledge is important [85] Knowledge and competence can beacquired by admitting new people with desirable skills [108] In particular T-shapedskills embodied in employees are most often associated with core capability [56 6070] T-shaped skills may enable individual specialists to have synergistic conversa-tions with one another [74]

Technology contributes to knowledge management [35] This technology infra-structure includes IT and its capabilities [90 99] IT is widely employed to connectpeople with reusable codified knowledge and it facilitates conversations to createnew knowledge Among technology-related variables this study focuses on IT sup-port [108] ITs allow an organization to create share store and use knowledge [70]Therefore the support of IT is essential for initiating and carrying out knowledgemanagement

Enablers may be structured based upon a socio-technical theory [86] This theorydescribes an organization from the social and technical perspectives The two per-spectives are not unique to management information systems (MIS) research [12]they are made up of two jointly independent but correlative interacting componentsOrganizational culture organizational structure and people are social enablers IT is

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 189

a technical enabler For the sake of clarity we consider the impact of each knowledgeenabler independently

Processes

A number of studies have addressed knowledge management processes they divideknowledge management into several processes For example Alavi and Leidner [2]considered four processes such as creation storage transfer and application Theseprocesses are often concurrent and not always in a linear sequence [9]

Among these processes creation-related activities (for example creation [2] orconstruction [21]) become important because knowledge creation is a strategic weaponin todayrsquos global marketplace without the constant creation of knowledge a businessis condemned to obsolescence [83 87] Knowledge creation is a continuous processwhereby individuals and groups within a firm and between firms share tacit and ex-plicit knowledge [82] Although a great deal has been discussed about the importanceof knowledge creation there is relatively little empirical evidence [90] Thereforethe emphasis of this study is on knowledge creation

To explore knowledge creation our study adopts the SECI (socializationexternalization combination internalization) model by Nonaka and Takeuchi [82]for the following reasons First their work has become widely accepted [98] it hasbeen used in many research areas such as organizational learning new product devel-opment and IT [98 99] Second their model includes not only knowledge creationbut also knowledge transfer The transfer of existing knowledge and the creation ofnew knowledge are important and both of them should be considered in knowledgemanagement [69] Their SECI model is made up of four intertwined activity modessocialization (S) externalization (E) combination (C) and internalization (I) Social-ization converts tacit knowledge into new tacit knowledge through social interactionsamong members Externalization codifies tacit knowledge into explicit concepts Com-bination converts explicit knowledge into more systematic sets by combining keypieces Internalization embodies explicit knowledge into tacit knowledge

Intermediate Outcome

In order to achieve a better understanding of knowledge management performancecompanies should attempt to link knowledge processes with intermediate outcomes[18] An important intermediate outcome is organizational creativity which pro-vides a key to the understanding of organizational effectiveness and survival [122]Our model incorporates organizational creativity because it is the seed of all innova-tion [5] and at the very heart of knowledge management [40] Organizational cre-ativity transforms knowledge into business value Neglecting organizational creativitycan quickly undermine a business The relationship between knowledge creationand organizational creativity has received relatively little attention despite its highpotential [119]

190 LEE AND CHOI

Organizational Performance

Measuring organizational performance is not a trivial task because it strongly affectsthe behavior of managers and employees The ultimate test of any business is whetherit leads to measurable improvements in organizational performance

Methods for measuring organizational performance in knowledge management canbe categorized into four groups financial measures [11] intellectual capital [110]tangible and intangible benefits [104] and balanced scorecard [63] This study adoptsa specific measure which is developed and validated by Deshpande et al [22] andDrew [25] This measure can be thought of as a variation of the balanced scorecardmethod The balanced scorecard retains financial performance and supplements itwith measures on the drivers of future potential In addition it is more useful thanintellectual capital or a tangible and intangible approach because it shows cause andeffect links between knowledge components and organization strategies [63]

In summary our empirical research model illustrates the relationship among vari-ables as shown in Figure 3 In total the model consists of 13 variables

Hypotheses

Our hypotheses are largely derived from theoretical statements made in the litera-ture on knowledge management We present our hypotheses through the followingvariables

Collaboration

Collaboration may be defined as the degree to which people in a group actively helpone another in their work [55] Collaborative culture affects knowledge creation throughincreasing knowledge exchange [68 79] Exchanging knowledge among differentmembers is a prerequisite for knowledge creation Collaborative culture fosters thistype of exchange by reducing fear and increasing openness to other members Forexample Zucker et al [126] confirmed the significance of collaborative culture inknowledge creation by examining the biotechnology industry Collaboration betweenorganizational members also tightens individual differences [70] It can help peopledevelop a shared understanding about an organizationrsquos external and internal envi-ronments through supportive and reflective communication Without shared under-standing among organizational members little knowledge is ever created [30 47]We do not have a priori reason to expect a different relationship

H1 There is a positive relationship between collaboration and knowledge cre-ation process

Trust

Trust can be defined as maintaining reciprocal faith in each other in terms of intentionand behaviors [67] Trust may facilitate open substantive and influential knowledge

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 191

exchange [81 85] When their relationships are high in trust people are more willingto participate in knowledge exchange [79] Szulanski [114] empirically found thatthe lack of trust among employees is one of the key barriers against knowledge ex-change The increase in knowledge exchange brought on by mutual trust results inknowledge creation Trust also encourages a climate conducive to better knowledgecreation by alleviating the fear of risk The presence of a high level of trust can reducethis risk [81 92 100] Trust is also critical in a cross-functional or interorganizationalteam because withholding information because of a lack of trust can be especiallyharmful to knowledge creation [47 59] Therefore we would expect the followingrelationship to hold true

H2 There is a positive relationship between trust and knowledge creation process

Learning

Learning can be defined as the degree to which it is encouraged in organizations [55]The emphasis on learning infuses an organization with new knowledge [17] Learningis the acquisition of new knowledge by people who are able and willing to apply thatknowledge in making decisions or influencing others [78] Through the emphasis onlearning and development organizations can help individuals play more active rolesin knowledge creation Kanevsky and Housel [62] insisted that the amount of timespent on learning is positively related with the amount of knowledge For successfulknowledge creation organizations should develop a deeply ingrained learning culture

Figure 3 A Research Model

192 LEE AND CHOI

[88] and provide various learning means such as education training and mentoring[112 113] For example Nucor [39] which has been the most innovative steel com-pany in the United States built a knowledge creation foundation by investing in con-tinuous and multifunctional training programs Hence we hypothesize

H3 There is a positive relationship between learning and knowledge creationprocess

Centralization

Centralization refers to the locus of decision authority and control within an organi-zational entity [14 27] The concentration of decision-making authority inevitablyreduces creative solutions whereas the dispersion of power facilitates spontaneityexperimentation and the freedom of expression which are the lifeblood of knowl-edge creation [37] Moreover centralized structure hinders interdepartmental com-munication and frequent sharing of ideas [122] due to time-consuming communicationchannels [10] it also causes distortion and discontinuousness of ideas [108] Withouta constant flow of communication and ideas knowledge creation does not occur Adecentralized organizational structure has been found to facilitate an environmentwhere employees participate in knowledge building process more spontaneously [52]Participatory work environments foster knowledge creation by motivating organiza-tional membersrsquo involvements Therefore decreased centralization in the form of lo-cus of authority can lead to increased creation of knowledge [106 108 115] Weadvance the fourth hypothesis

H4 There is a negative relationship between centralization and knowledge cre-ation process

Formalization

Formalization refers to the degree to which decisions and working relationships aregoverned by formal rules standard policies and procedures [49 89] Knowledgecreation requires flexibility and less emphasis on work rules [57 73] The range ofnew ideas seems to be restricted when strict formal rules dominate an organizationFlexibility can accommodate better ways of doing things [37] Therefore the in-creased flexibility in an organizational structure can result in increased creation ofknowledge Knowledge creation also requires variation [121] In order to be moreadaptable when unforeseen problems arise an organization may accommodate varia-tion in process and structure Low formalization permits openness and variation whichencourage new ideas and behaviors [17] Knowledge creation is also likely to beencouraged through unhindered communications and interactions [10] Formalitystifles the communication and interaction necessary to create knowledge Lack offormal structure tends to enable organizational members to communicate and interactwith one another to create knowledge [59] Hence we hypothesize

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 193

H5 There is a negative relationship between formalization and knowledge cre-ation process

T-Shaped Skills

T-shaped skills are both deep (the vertical part of the ldquoTrdquo) and broad (the horizontalpart of the ldquoTrdquo) that is their possessors can explore particular knowledge domainsand their various applications in particular products [70] For example persons withT-shaped skills not only have a deep knowledge of a discipline (like ceramic materi-als engineering) but also know how their discipline interacts with other disciplines(such as polymer processing) [56] People with T-shaped skills are extremely valu-able for creating knowledge because they can integrate diverse knowledge assets [70]They have the ability both to combine theoretical and practical knowledge and to seehow their branch of knowledge interacts with other branches Therefore they canexpand their competence across several functional branch areas and thus create newknowledge [60 74]

H6 There is a positive relationship between the presence of the organizationalmembers with T-shaped skills and knowledge creation process

IT Support

IT support means the degree to which knowledge management is supported by theuse of ITs [35] Many researchers have found that IT is a crucial element for knowl-edge creation [19 36 39] IT affects knowledge in a variety of ways First IT facili-tates rapid collection storage and exchange of knowledge on a scale not practicablein the past thereby assisting the knowledge creation process [92] Second a well-developed technology integrates fragmented flows of knowledge [35] This integra-tion can eliminate barriers to communication among departments in organizationThird IT fosters all modes of knowledge creation and is not limited to the transfer ofexplicit knowledge [90 91 99] For instance InfoTESTrsquos enhanced product realiza-tion (EPR) project employs electronic whiteboarding and videoconferencing to en-hance exchanges of tacit knowledge [91] Thus we hypothesize

H7 There is a positive relationship between IT support and knowledge creationprocess

Organizational Creativity

Organizational creativity is the capability of creating valuable and useful productsservices ideas or procedures by individuals working together in a complex socialsystem [5 122] Knowledge plays an important role in the ability of the organizationto be creative [119] Thus organizations with better knowledge diffusion and creat-ing mechanisms are more intelligent [34] Organizational creativity also connectsand rearranges knowledge to create new often surprising ideas that others judge to be

194 LEE AND CHOI

useful [65] Creativity is not necessarily related to the amount of knowledge that anemployee possesses but rather the way in which knowledge is created and shared [4]The processes of knowledge creation unleash organizational creativity Naturallyorganizational creativity has a strong link with knowledge creation [119]

H8 There is a positive relationship between the knowledge creation process andorganizational creativity

Organizational Performance

In our study organizational performance is assessed by the use of global output mea-sures such as market share profitability growth rate innovativeness successfulnessand the size of business in comparison with key competitors [22 25] In a knowl-edge-based economy organizational creativity represents a dramatic organizationalchange Robinson and Stern [93] insisted that the tangible results of corporate cre-ativity are the organizational change such as improvements (changes to what is al-ready done) and innovations (entirely new activities for the company) Withoutcreativity organizations may fail to adapt to changing internal and external condi-tions [88] and thus lose their knowledge advantage Typically the goals of organiza-tional change include the various aspects of organizational performance such asorganizational effectiveness survival improvement or innovation Organizationalperformance can be thought of as the output of a process that encourages creativity[97] Thus improvements of creativity might lead to better organizational perfor-mance [18 88 102] We hypothesize that

H9 There is a positive relationship between organizational creativity and orga-nizational performance

Sample and Measures

SAMPLES WERE RESTRICTED TO THE LISTED COMPANIES in order to include majorcompanies in Korea Annual Corporation Reports by Maeil Business Newspaper [75]is the source for sampling because it analyzes all listed companies in the Korea StockExchange Therefore the unit of analysis in this study is the organization We adoptedboth interviews and mail surveys Interviews were used to investigate the currentdetailed status of knowledge management This investigation included knowledgemanagement practices such as the number of communities of practice the rate of useof the knowledge management system and the cost of investment in knowledge man-agement activities Although interview data is not analyzed statistically they werevaluable for our interpretation

After the interview a questionnaire-based survey was conducted Questionnaireswere administered to a total of 1425 middle managers in 147 organizations Depend-ing on each individual firmrsquos size five to 15 middle managers were surveyed fromeach firm Middle managers were reached through their CEOs or CIOs A typical jobtitle of a middle manager was department chief Middle managers were surveyed

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 195

because they played key roles in managing knowledge Middle managers are posi-tioned at the intersection of the vertical and horizontal flows of knowledge Thusthey can synthesize the tacit knowledge of both top managers and frontline employ-ees make it explicit and incorporate it into new products and services [82]

A multiple-item method was used to construct the questionnaires Each item wasbased on a six-point Likert scale from ldquovery lowrdquo to ldquovery highrdquo Likert scales asgenerally used tend to underestimate the extreme positions [3] Respondents are re-luctant to express an extreme position even if they have it They tend to please theinterviewer appear helpful or respond in what they perceive to be a socially accept-able answer Resorting to a scale without a midpoint seems to help mollify this socialdesirability bias without changing the direction of opinion [32] The six-point Likertscale avoids a midpoint which prevents respondents from using a neutral defaultoption [5] The questionnaires were written in Korean

Research constructs were operationalized on the basis of related studies and pilottests The operational definitions of instruments and their related literature are sum-marized in Appendix A Most of the research constructs have already been validatedand used for other studies on knowledge management organizational design learn-ing or IT management For example formalization items have already been vali-dated and used by Caruana et al [14] and Rapert and Wren [89] Self-reported itemshave been used to assess organizational performance [22 25] Although these itemsdo not present a fully balanced scorecard they are effective for comparing businessunits and industries [25] Questionnaire items for the knowledge creation processwhich were used in this study had been validated and used by Nonaka et al [83]

Analysis

Sample Characteristics

IN TOTAL 451 QUESTIONNAIRES FROM 63 out of 147 firms were returned (43 percentresponse rate) The rates from individual firms ranged from 23 to 100 percent Due toincomplete data 25 responses from five firms were eliminated Consequently 426responses from 58 firms were analyzed Table 2 summarizes the respondent charac-teristics in terms of industry type departments total sales revenue and number oftotal employees

Samples are divided into three industry types manufacturing service and finan-cial business (banking finance insurance) The majority of these firms are in theservice industry Thirty-two firms have annual total sales revenue of $1 billion ormore and 31 firms have 1000 employees or more As mentioned previously sampleswere collected from various middle managers

Reliability and Validity Analysis

Table 3 presents the results of reliability and validity tests An analysis was performedon the 36 items that measured the components of knowledge enablers other analyses

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 181

Research Background and Literature Review

Theoretical Background

MANY RESEARCHERS HAVE EMPHASIZED three major factors for managing knowledgeenablers processes and organizational performance [9 21 85] Knowledge manage-ment enablers (or influencing factors) are organizational mechanisms for fostering knowl-edge consistently [57] they can stimulate knowledge creation protect knowledge andfacilitate the sharing of knowledge in an organization [108] Knowledge processes(knowledge management activities) can be thought of as a structured coordination formanaging knowledge effectively [35] Typically knowledge processes include activi-ties such as creation sharing storage and usage [2 9] Whereas knowledge processesrepresent the basic operations of knowledge [105] enablers provide the infrastructurenecessary for the organization to increase the efficiency of knowledge processes [96]Organizational performance may be defined as the degree to which companies achievedits business objectives [28] It may be measured in terms of organizational learningprofitability or other financial benefits in knowledge management [18 104] Withoutmeasurable success passion from employees and managers will vanish [85]

There is a general recognition among academics that knowledge management is across-functional and multifaceted discipline A variety of components make up knowl-edge management and the understanding of their interaction is important a holisticview is very useful [80] To this end an integrative research model is necessary thatis the relationships among knowledge enablers processes and organizational perfor-mance can be identified within the framework of systems thinking Systems thinkingtheory considers problems in their entirety [95] This theory is better able to describecomplex and dynamic characteristics of knowledge management in a systematic fash-ion Therefore our integrative framework will be based on this systems thinking theory

Our primary research focus is on the relationships between knowledge enablersand organizational performance by elaborating on the significance of knowledge pro-cesses as the foundation of organizational advantage [79] The relationship amongthese three components is nothing new it can be found in the input-process-outputmodel by Hackerman and Morris [41] The model assumes that the input factorsaffect output performances through certain kinds of interaction processes knowl-edge management enablers affect organizational performance through knowledgeprocesses This relationship is also explained by the use of the knowledge-chain modelproposed by Holsapple and Singh [51] This model suggests that leadership establishenabling conditions for achieving organizational outcome through the knowledgemanagement activities such as acquisition generation internalization and externali-zation It means that knowledge enablers (eg leadership) affect organizational out-come through knowledge processes

A direct relationship between knowledge processes and organizational performanceis not explored yet Because many factors influence the determination of the organiza-tional performance attempts to trace causality to any single factor such as knowledge

182 LEE AND CHOI

process may be risky In order to understand the effect of the knowledge processes onorganizational performance intermediate outcomes (for example knowledge satis-faction or organizational creativity) may be introduced [18] Intermediate outcomesreflect different aspects of an organizationrsquos performance both financial and nonfi-nancial This incorporation may help confirm that enablers ultimately create businessvalue

In sum this paper proposes a research framework as shown in Figure 1

Previous Empirical Studies

Previous empirical studies have investigated the relationships among knowledgemanagement factors They can be classified into four categories depending on howthey identify the relationships (1) relationships between knowledge enablers (2) re-lationships between knowledge enablers and process (3) relationships between knowl-edge process and organizational performance and (4) relationships among knowledgeenablers processes and organizational performance This comparison may be high-lighted as shown in Figure 2

The studies under the first category focus on the relationships among knowledgeenablers The emphasis is on the examination of the effect of knowledge enablers Toidentify this effect they have investigated various knowledge enablers such as knowl-edge management methods structure and culture For example Bennett and Gabriel[10] analyzed a number of knowledge management methods in view of organiza-tional structure culture size and environment

The second category explores the relationships between knowledge enablers andknowledge processes A central proposition is that knowledge enablers (eg industrycharacteristics or knowledge characteristics) should influence knowledge processes(eg transfer) Zander and Kogut [124] proposed that the transfer of organizationalcapabilities be related to the characteristics of social knowledge they analyzed theeffects of the ease of codifying manufacturing capabilities on its transfer timeAppleyard [6] explored knowledge transfer patterns among various nations and in-dustries Szulanski [114] investigated the relationship between four origins of sticki-ness (characteristics of the knowledge transferred the source the recipient and thecontext in which the transfer takes place) and knowledge transfer Hansen [43] em-ployed the notion of complex knowledge to explain the role of weak ties in transfer-ring knowledge in a multiunit organization

The third category examines the relationships between knowledge enablers andorganizational performance The purpose of these studies is to sharpen the under-standing of the effects of knowledge enablers (eg knowledge management strategy)

Figure 1 An Integrative Research Framework for Studying Knowledge Management

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 183

on organizational performance (eg return on assets [ROA] or return on sales [ROS])Bierly and Chakrabarti [11] tried to identify how knowledge management strategiesaffect organizational performance They analyzed knowledge strategies of 21 USpharmaceutical companies that had been categorized into explorers exploiters lon-ers and innovators Simonin [104] tested the relationships among collaborative expe-rience know-how and achievement of organizational performance He proposed thatthe experience of a firm has to be transformed into know-how before it could improveorganizational performance

The emphasis of the fourth category is on relationships among knowledge enablersknowledge processes and organizational performance The primary objective of thesestudies is to identify and assess knowledge enablers (eg task or infrastructure capa-bilities) and processes (eg creation or their capabilities) for improving organiza-tional performance (eg knowledge satisfaction or organizational effectiveness)Becerra-Fernandez and Sabherwal [8] proposed a contingency framework includingtwo attributes of the organizational subunitrsquos tasksmdashprocess or content orientationand focused or broad domainmdashand linked them to Nonakarsquos knowledge creationprocess [82] The relationship between knowledge creation process and knowledgesatisfaction was also investigated Gold et al [35] analyzed two relationships one

Figure 2 Research Models for Studying Knowledge Management

184 LEE AND CHOI

between infrastructure capabilities and organizational effectiveness and the otherbetween process capabilities and organizational effectiveness Table 1 compares theseprevious studies

Synthesis of Previous Studies

Synthesis of previous studies yields some observations First an integrative model isstill missing Although some studies investigate the relationships among knowledgeenablers processes or organizational performance [8 35] they fail to explore therelationships between enablers and processes simultaneously If managers understandthese relationships in an integrative fashion they can stand a better chance of improv-ing their firmrsquos performance

Second the role of knowledge management processes is not consistent Some stud-ies recognized both knowledge enablers and processes as antecedents of organiza-tional performance [8 35] Other studies recognized knowledge enablers aspreconditions of knowledge processes [6 43 114 124] Therefore the challenge isto clarify the role of knowledge management processes [108]

Third measuring knowledge management performance is still difficult Some stud-ies captured the contribution by the use of knowledge management outcome mea-sures such as knowledge satisfaction [8] whereas others adopted conventionalperformance measures such as ROA [11 104] or organizational effectiveness [35] Itwould appear that the former studies take the relationship between knowledge man-agement outcome and organizational performance for granted although the relation-ship has not been validated The results of the latter studies should be examinedcarefully because the direct relationship between knowledge management processesand organizational performance has not been validated yet [18]

Fourth the knowledge transfer process has been studied extensively [6 43 114124] whereas the other processes such as creation or utilization have received rela-tively little attention In particular some studies have suggested that knowledge cre-ation is most critical for an organizationrsquos long-term success [30] Moreover knowledgetransfer has been assessed by the use of object-perspective measures such as time totransfer [124] number of times of knowledge transfer [6] or percentage of trans-ferred knowledge [43] Recently some researchers have tried to measure knowledgeprocesses themselves [8 35] For example Becerra-Fernandez and Sabherwal [8]measured the capacity for knowledge creation by Nonakarsquos knowledge creation modelnot by the use of creation output such as the number of created ideas or patents

A Research Model

OUR OBJECTIVE IS NEITHER TO PROPOSE a model that delineates all of the relation-ships underlying knowledge management nor to generate a longer list of possibleknowledge enablers or processes that affect organizational performance Therefore

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 185

Tabl

e 1

A C

ompa

riso

n of

Pre

viou

s St

udie

s

Org

aniz

atio

nal

Stud

yK

M e

nabl

ers

KM

pro

cess

espe

rfor

man

ceFi

ndin

gs

Rel

atio

nshi

p am

ong

enab

lers

Ben

net a

nd G

abrie

l [10

]S

truc

ture

NA

NA

Effe

ct o

f cha

nge-

frie

ndly

cul

ture

Cul

ture

on th

e nu

mbe

r of

KM

met

hods

Siz

eem

ploy

ed

Env

ironm

ent

KM

met

ho

d

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

roce

sses

Zan

der

and

Kog

ut [1

24]

Cha

ract

eris

tics

ofTr

ansf

er (

tim

e to

NA

Cod

ifiab

ility

tea

chab

ility

and

soci

etal

kno

wle

dge

tran

sfer

)pa

ralle

l dev

elop

men

t hav

esi

gnifi

cant

effe

cts

on th

e tim

eto

tran

sfer

App

leya

rd [6

]In

dust

ry a

ndTr

ansf

er (

nu

mb

er o

fN

Apu

blic

sou

rces

of k

now

ledg

ena

tiona

l cha

ract

eris

tics

tim

es t

he

resp

on

den

tsar

e m

uch

mor

e pr

eval

ent i

np

rovi

de

and

rec

eive

know

ledg

e tr

ansf

er in

kno

wle

dg

e in

a g

iven

sem

icon

duct

ors

than

in th

ep

erio

d)

stee

l ind

ustr

yP

ublic

sou

rces

of t

echn

ical

know

ledg

e pl

ay a

larg

er r

ole

inkn

owle

dge

tran

sfer

in J

apan

than

in th

e U

nite

d S

tate

s(c

onti

nues

)

186 LEE AND CHOI

Tabl

e 1

(C

ontin

ued)

Org

aniz

atio

nal

Stud

yK

M e

nabl

ers

KM

pro

cess

espe

rfor

man

ceFi

ndin

gs

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

roce

sses

(co

ntin

ued)

Szu

lans

ki [1

14]

Cha

ract

eris

tics

ofTr

ansf

er (

fou

r-st

age

NA

Rec

ipie

ntrsquos

lack

of a

bsor

ptiv

eth

e kn

owle

dge

tran

sfer

pro

cess

es)

capa

city

cau

sal a

mbi

guity

and

tran

sfer

red

sour

cean

ard

uous

ness

of t

here

cipi

ent c

onte

xt

rela

tions

hip

are

the

maj

orim

pedi

men

ts to

kno

wle

dge

tran

sfer

Han

sen

[43]

Wea

k tie

s (d

ista

ntTr

ansf

er (

per

cen

tag

eN

AW

eak

ties

impe

de th

e tr

ansf

eran

d in

freq

uent

of

a p

roje

ctrsquos

to

tal

of c

ompl

ex k

now

ledg

ere

latio

nshi

ps)

kno

wle

dg

e th

atK

now

ledg

eco

me

fro

m o

ther

char

acte

rist

ics

div

isio

ns)

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

erfo

rman

ce

Bie

rly

and

KM

str

ateg

yN

AR

OS

Inno

vato

rs a

nd e

xplo

rers

are

Cha

krab

arti

[11]

RO

Am

ore

prof

itabl

e th

an e

xplo

iters

and

lone

rs

Sim

onin

[104

]C

olla

bora

tive

NA

Tan

gib

le b

enef

its

Col

labo

rativ

e kn

ow-h

ow a

llow

sex

perie

nce

(RO

I R

OA

)fir

ms

to a

chie

ve g

reat

erC

olla

bora

tive

Inta

ng

ible

ben

efit

sor

gani

zatio

nal b

enef

its

know

-how

colla

bora

tive

expe

rien

ce a

lone

does

not

ens

ure

that

a fi

rm w

illbe

nefit

from

a c

olla

bora

tion

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 187

Rel

atio

nshi

p am

ong

know

ledg

e en

able

rs p

roce

sses

and

per

form

ance

Bec

erra

-Fer

nand

ez a

ndTa

sk (

proc

ess

orC

reat

ion

(soc

ializ

atio

nK

M s

atis

fact

ion

Soc

ializ

atio

n is

sui

tabl

e fo

rS

abhe

rwal

[8]

cont

ent o

rien

tatio

nex

tern

aliz

atio

nbr

oad

and

proc

ess-

orie

nted

focu

sed

orco

mbi

natio

nta

sks

ext

erna

lizat

ion

for

broa

d do

mai

n)

inte

rnal

izat

ion)

fo

cuse

d an

d co

nten

t-or

ient

edta

sks

com

bina

tion

for

broa

dan

d co

nten

t-or

ient

ed ta

sks

and

inte

rnal

izat

ion

for

focu

ses

and

proc

ess-

orie

nted

task

sco

mbi

natio

n an

dex

tern

aliz

atio

n af

fect

know

ledg

e sa

tisfa

ctio

n

Gol

d et

al

[35]

Infr

astr

uctu

re c

apab

ility

Pro

cess

cap

abili

tyO

rgan

izat

ion

alIn

fras

truc

ture

and

pro

cess

(tec

hnol

ogy

str

uctu

re

(acq

uisi

tion

con

vers

ion

effe

ctiv

enes

sca

pabi

litie

s co

ntrib

ute

to th

ecu

lture

)ap

plic

atio

n p

rote

ctio

n)

achi

evem

ent o

f org

aniz

atio

nal

effe

ctiv

enes

s

Not

e B

oldf

ace

type

ind

icat

es d

epen

dent

var

iabl

es

188 LEE AND CHOI

our model highlights a few major factors that can explain a large proportion of thevariance in knowledge management

Variables

Enablers

A variety of knowledge management enablers have been addressed in the literature[57 70 97] Among these enablers organizational culture structure people and ITare incorporated into our research model Organizational culture is the most impor-tant factor for successful knowledge management [15 20 21 35] Culture definesnot only what knowledge is valued but also what knowledge must be kept inside theorganization for sustained innovative advantage [71] Organizations should establishan appropriate culture that encourages people to create and share knowledge withinan organization [49 70] This study focuses on collaboration trust and learning onthe basis of the concept of care [29] Care is a key enabler for organizational relation-ships [68] When organizational relationships are fostered through care knowledgecan be created and shared

The organizational structure within an organization may encourage or inhibit knowl-edge management [35 47 82] For example Ichijo et al [57] insisted that firmsshould maintain consistency between their structures to put their knowledge to useOur study includes two key structural factors such as centralization and formalization[77] They are recognized as key variables underlying the structural construct More-over their effects on knowledge management within organizations are widely recog-nized to be potent [29 59 72 91]

People are at the heart of creating organizational knowledge [15 49 80] It is peoplewho create and share knowledge Therefore managing people who are willing tocreate and share knowledge is important [85] Knowledge and competence can beacquired by admitting new people with desirable skills [108] In particular T-shapedskills embodied in employees are most often associated with core capability [56 6070] T-shaped skills may enable individual specialists to have synergistic conversa-tions with one another [74]

Technology contributes to knowledge management [35] This technology infra-structure includes IT and its capabilities [90 99] IT is widely employed to connectpeople with reusable codified knowledge and it facilitates conversations to createnew knowledge Among technology-related variables this study focuses on IT sup-port [108] ITs allow an organization to create share store and use knowledge [70]Therefore the support of IT is essential for initiating and carrying out knowledgemanagement

Enablers may be structured based upon a socio-technical theory [86] This theorydescribes an organization from the social and technical perspectives The two per-spectives are not unique to management information systems (MIS) research [12]they are made up of two jointly independent but correlative interacting componentsOrganizational culture organizational structure and people are social enablers IT is

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 189

a technical enabler For the sake of clarity we consider the impact of each knowledgeenabler independently

Processes

A number of studies have addressed knowledge management processes they divideknowledge management into several processes For example Alavi and Leidner [2]considered four processes such as creation storage transfer and application Theseprocesses are often concurrent and not always in a linear sequence [9]

Among these processes creation-related activities (for example creation [2] orconstruction [21]) become important because knowledge creation is a strategic weaponin todayrsquos global marketplace without the constant creation of knowledge a businessis condemned to obsolescence [83 87] Knowledge creation is a continuous processwhereby individuals and groups within a firm and between firms share tacit and ex-plicit knowledge [82] Although a great deal has been discussed about the importanceof knowledge creation there is relatively little empirical evidence [90] Thereforethe emphasis of this study is on knowledge creation

To explore knowledge creation our study adopts the SECI (socializationexternalization combination internalization) model by Nonaka and Takeuchi [82]for the following reasons First their work has become widely accepted [98] it hasbeen used in many research areas such as organizational learning new product devel-opment and IT [98 99] Second their model includes not only knowledge creationbut also knowledge transfer The transfer of existing knowledge and the creation ofnew knowledge are important and both of them should be considered in knowledgemanagement [69] Their SECI model is made up of four intertwined activity modessocialization (S) externalization (E) combination (C) and internalization (I) Social-ization converts tacit knowledge into new tacit knowledge through social interactionsamong members Externalization codifies tacit knowledge into explicit concepts Com-bination converts explicit knowledge into more systematic sets by combining keypieces Internalization embodies explicit knowledge into tacit knowledge

Intermediate Outcome

In order to achieve a better understanding of knowledge management performancecompanies should attempt to link knowledge processes with intermediate outcomes[18] An important intermediate outcome is organizational creativity which pro-vides a key to the understanding of organizational effectiveness and survival [122]Our model incorporates organizational creativity because it is the seed of all innova-tion [5] and at the very heart of knowledge management [40] Organizational cre-ativity transforms knowledge into business value Neglecting organizational creativitycan quickly undermine a business The relationship between knowledge creationand organizational creativity has received relatively little attention despite its highpotential [119]

190 LEE AND CHOI

Organizational Performance

Measuring organizational performance is not a trivial task because it strongly affectsthe behavior of managers and employees The ultimate test of any business is whetherit leads to measurable improvements in organizational performance

Methods for measuring organizational performance in knowledge management canbe categorized into four groups financial measures [11] intellectual capital [110]tangible and intangible benefits [104] and balanced scorecard [63] This study adoptsa specific measure which is developed and validated by Deshpande et al [22] andDrew [25] This measure can be thought of as a variation of the balanced scorecardmethod The balanced scorecard retains financial performance and supplements itwith measures on the drivers of future potential In addition it is more useful thanintellectual capital or a tangible and intangible approach because it shows cause andeffect links between knowledge components and organization strategies [63]

In summary our empirical research model illustrates the relationship among vari-ables as shown in Figure 3 In total the model consists of 13 variables

Hypotheses

Our hypotheses are largely derived from theoretical statements made in the litera-ture on knowledge management We present our hypotheses through the followingvariables

Collaboration

Collaboration may be defined as the degree to which people in a group actively helpone another in their work [55] Collaborative culture affects knowledge creation throughincreasing knowledge exchange [68 79] Exchanging knowledge among differentmembers is a prerequisite for knowledge creation Collaborative culture fosters thistype of exchange by reducing fear and increasing openness to other members Forexample Zucker et al [126] confirmed the significance of collaborative culture inknowledge creation by examining the biotechnology industry Collaboration betweenorganizational members also tightens individual differences [70] It can help peopledevelop a shared understanding about an organizationrsquos external and internal envi-ronments through supportive and reflective communication Without shared under-standing among organizational members little knowledge is ever created [30 47]We do not have a priori reason to expect a different relationship

H1 There is a positive relationship between collaboration and knowledge cre-ation process

Trust

Trust can be defined as maintaining reciprocal faith in each other in terms of intentionand behaviors [67] Trust may facilitate open substantive and influential knowledge

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 191

exchange [81 85] When their relationships are high in trust people are more willingto participate in knowledge exchange [79] Szulanski [114] empirically found thatthe lack of trust among employees is one of the key barriers against knowledge ex-change The increase in knowledge exchange brought on by mutual trust results inknowledge creation Trust also encourages a climate conducive to better knowledgecreation by alleviating the fear of risk The presence of a high level of trust can reducethis risk [81 92 100] Trust is also critical in a cross-functional or interorganizationalteam because withholding information because of a lack of trust can be especiallyharmful to knowledge creation [47 59] Therefore we would expect the followingrelationship to hold true

H2 There is a positive relationship between trust and knowledge creation process

Learning

Learning can be defined as the degree to which it is encouraged in organizations [55]The emphasis on learning infuses an organization with new knowledge [17] Learningis the acquisition of new knowledge by people who are able and willing to apply thatknowledge in making decisions or influencing others [78] Through the emphasis onlearning and development organizations can help individuals play more active rolesin knowledge creation Kanevsky and Housel [62] insisted that the amount of timespent on learning is positively related with the amount of knowledge For successfulknowledge creation organizations should develop a deeply ingrained learning culture

Figure 3 A Research Model

192 LEE AND CHOI

[88] and provide various learning means such as education training and mentoring[112 113] For example Nucor [39] which has been the most innovative steel com-pany in the United States built a knowledge creation foundation by investing in con-tinuous and multifunctional training programs Hence we hypothesize

H3 There is a positive relationship between learning and knowledge creationprocess

Centralization

Centralization refers to the locus of decision authority and control within an organi-zational entity [14 27] The concentration of decision-making authority inevitablyreduces creative solutions whereas the dispersion of power facilitates spontaneityexperimentation and the freedom of expression which are the lifeblood of knowl-edge creation [37] Moreover centralized structure hinders interdepartmental com-munication and frequent sharing of ideas [122] due to time-consuming communicationchannels [10] it also causes distortion and discontinuousness of ideas [108] Withouta constant flow of communication and ideas knowledge creation does not occur Adecentralized organizational structure has been found to facilitate an environmentwhere employees participate in knowledge building process more spontaneously [52]Participatory work environments foster knowledge creation by motivating organiza-tional membersrsquo involvements Therefore decreased centralization in the form of lo-cus of authority can lead to increased creation of knowledge [106 108 115] Weadvance the fourth hypothesis

H4 There is a negative relationship between centralization and knowledge cre-ation process

Formalization

Formalization refers to the degree to which decisions and working relationships aregoverned by formal rules standard policies and procedures [49 89] Knowledgecreation requires flexibility and less emphasis on work rules [57 73] The range ofnew ideas seems to be restricted when strict formal rules dominate an organizationFlexibility can accommodate better ways of doing things [37] Therefore the in-creased flexibility in an organizational structure can result in increased creation ofknowledge Knowledge creation also requires variation [121] In order to be moreadaptable when unforeseen problems arise an organization may accommodate varia-tion in process and structure Low formalization permits openness and variation whichencourage new ideas and behaviors [17] Knowledge creation is also likely to beencouraged through unhindered communications and interactions [10] Formalitystifles the communication and interaction necessary to create knowledge Lack offormal structure tends to enable organizational members to communicate and interactwith one another to create knowledge [59] Hence we hypothesize

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 193

H5 There is a negative relationship between formalization and knowledge cre-ation process

T-Shaped Skills

T-shaped skills are both deep (the vertical part of the ldquoTrdquo) and broad (the horizontalpart of the ldquoTrdquo) that is their possessors can explore particular knowledge domainsand their various applications in particular products [70] For example persons withT-shaped skills not only have a deep knowledge of a discipline (like ceramic materi-als engineering) but also know how their discipline interacts with other disciplines(such as polymer processing) [56] People with T-shaped skills are extremely valu-able for creating knowledge because they can integrate diverse knowledge assets [70]They have the ability both to combine theoretical and practical knowledge and to seehow their branch of knowledge interacts with other branches Therefore they canexpand their competence across several functional branch areas and thus create newknowledge [60 74]

H6 There is a positive relationship between the presence of the organizationalmembers with T-shaped skills and knowledge creation process

IT Support

IT support means the degree to which knowledge management is supported by theuse of ITs [35] Many researchers have found that IT is a crucial element for knowl-edge creation [19 36 39] IT affects knowledge in a variety of ways First IT facili-tates rapid collection storage and exchange of knowledge on a scale not practicablein the past thereby assisting the knowledge creation process [92] Second a well-developed technology integrates fragmented flows of knowledge [35] This integra-tion can eliminate barriers to communication among departments in organizationThird IT fosters all modes of knowledge creation and is not limited to the transfer ofexplicit knowledge [90 91 99] For instance InfoTESTrsquos enhanced product realiza-tion (EPR) project employs electronic whiteboarding and videoconferencing to en-hance exchanges of tacit knowledge [91] Thus we hypothesize

H7 There is a positive relationship between IT support and knowledge creationprocess

Organizational Creativity

Organizational creativity is the capability of creating valuable and useful productsservices ideas or procedures by individuals working together in a complex socialsystem [5 122] Knowledge plays an important role in the ability of the organizationto be creative [119] Thus organizations with better knowledge diffusion and creat-ing mechanisms are more intelligent [34] Organizational creativity also connectsand rearranges knowledge to create new often surprising ideas that others judge to be

194 LEE AND CHOI

useful [65] Creativity is not necessarily related to the amount of knowledge that anemployee possesses but rather the way in which knowledge is created and shared [4]The processes of knowledge creation unleash organizational creativity Naturallyorganizational creativity has a strong link with knowledge creation [119]

H8 There is a positive relationship between the knowledge creation process andorganizational creativity

Organizational Performance

In our study organizational performance is assessed by the use of global output mea-sures such as market share profitability growth rate innovativeness successfulnessand the size of business in comparison with key competitors [22 25] In a knowl-edge-based economy organizational creativity represents a dramatic organizationalchange Robinson and Stern [93] insisted that the tangible results of corporate cre-ativity are the organizational change such as improvements (changes to what is al-ready done) and innovations (entirely new activities for the company) Withoutcreativity organizations may fail to adapt to changing internal and external condi-tions [88] and thus lose their knowledge advantage Typically the goals of organiza-tional change include the various aspects of organizational performance such asorganizational effectiveness survival improvement or innovation Organizationalperformance can be thought of as the output of a process that encourages creativity[97] Thus improvements of creativity might lead to better organizational perfor-mance [18 88 102] We hypothesize that

H9 There is a positive relationship between organizational creativity and orga-nizational performance

Sample and Measures

SAMPLES WERE RESTRICTED TO THE LISTED COMPANIES in order to include majorcompanies in Korea Annual Corporation Reports by Maeil Business Newspaper [75]is the source for sampling because it analyzes all listed companies in the Korea StockExchange Therefore the unit of analysis in this study is the organization We adoptedboth interviews and mail surveys Interviews were used to investigate the currentdetailed status of knowledge management This investigation included knowledgemanagement practices such as the number of communities of practice the rate of useof the knowledge management system and the cost of investment in knowledge man-agement activities Although interview data is not analyzed statistically they werevaluable for our interpretation

After the interview a questionnaire-based survey was conducted Questionnaireswere administered to a total of 1425 middle managers in 147 organizations Depend-ing on each individual firmrsquos size five to 15 middle managers were surveyed fromeach firm Middle managers were reached through their CEOs or CIOs A typical jobtitle of a middle manager was department chief Middle managers were surveyed

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 195

because they played key roles in managing knowledge Middle managers are posi-tioned at the intersection of the vertical and horizontal flows of knowledge Thusthey can synthesize the tacit knowledge of both top managers and frontline employ-ees make it explicit and incorporate it into new products and services [82]

A multiple-item method was used to construct the questionnaires Each item wasbased on a six-point Likert scale from ldquovery lowrdquo to ldquovery highrdquo Likert scales asgenerally used tend to underestimate the extreme positions [3] Respondents are re-luctant to express an extreme position even if they have it They tend to please theinterviewer appear helpful or respond in what they perceive to be a socially accept-able answer Resorting to a scale without a midpoint seems to help mollify this socialdesirability bias without changing the direction of opinion [32] The six-point Likertscale avoids a midpoint which prevents respondents from using a neutral defaultoption [5] The questionnaires were written in Korean

Research constructs were operationalized on the basis of related studies and pilottests The operational definitions of instruments and their related literature are sum-marized in Appendix A Most of the research constructs have already been validatedand used for other studies on knowledge management organizational design learn-ing or IT management For example formalization items have already been vali-dated and used by Caruana et al [14] and Rapert and Wren [89] Self-reported itemshave been used to assess organizational performance [22 25] Although these itemsdo not present a fully balanced scorecard they are effective for comparing businessunits and industries [25] Questionnaire items for the knowledge creation processwhich were used in this study had been validated and used by Nonaka et al [83]

Analysis

Sample Characteristics

IN TOTAL 451 QUESTIONNAIRES FROM 63 out of 147 firms were returned (43 percentresponse rate) The rates from individual firms ranged from 23 to 100 percent Due toincomplete data 25 responses from five firms were eliminated Consequently 426responses from 58 firms were analyzed Table 2 summarizes the respondent charac-teristics in terms of industry type departments total sales revenue and number oftotal employees

Samples are divided into three industry types manufacturing service and finan-cial business (banking finance insurance) The majority of these firms are in theservice industry Thirty-two firms have annual total sales revenue of $1 billion ormore and 31 firms have 1000 employees or more As mentioned previously sampleswere collected from various middle managers

Reliability and Validity Analysis

Table 3 presents the results of reliability and validity tests An analysis was performedon the 36 items that measured the components of knowledge enablers other analyses

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

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n is

em

phas

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fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

182 LEE AND CHOI

process may be risky In order to understand the effect of the knowledge processes onorganizational performance intermediate outcomes (for example knowledge satis-faction or organizational creativity) may be introduced [18] Intermediate outcomesreflect different aspects of an organizationrsquos performance both financial and nonfi-nancial This incorporation may help confirm that enablers ultimately create businessvalue

In sum this paper proposes a research framework as shown in Figure 1

Previous Empirical Studies

Previous empirical studies have investigated the relationships among knowledgemanagement factors They can be classified into four categories depending on howthey identify the relationships (1) relationships between knowledge enablers (2) re-lationships between knowledge enablers and process (3) relationships between knowl-edge process and organizational performance and (4) relationships among knowledgeenablers processes and organizational performance This comparison may be high-lighted as shown in Figure 2

The studies under the first category focus on the relationships among knowledgeenablers The emphasis is on the examination of the effect of knowledge enablers Toidentify this effect they have investigated various knowledge enablers such as knowl-edge management methods structure and culture For example Bennett and Gabriel[10] analyzed a number of knowledge management methods in view of organiza-tional structure culture size and environment

The second category explores the relationships between knowledge enablers andknowledge processes A central proposition is that knowledge enablers (eg industrycharacteristics or knowledge characteristics) should influence knowledge processes(eg transfer) Zander and Kogut [124] proposed that the transfer of organizationalcapabilities be related to the characteristics of social knowledge they analyzed theeffects of the ease of codifying manufacturing capabilities on its transfer timeAppleyard [6] explored knowledge transfer patterns among various nations and in-dustries Szulanski [114] investigated the relationship between four origins of sticki-ness (characteristics of the knowledge transferred the source the recipient and thecontext in which the transfer takes place) and knowledge transfer Hansen [43] em-ployed the notion of complex knowledge to explain the role of weak ties in transfer-ring knowledge in a multiunit organization

The third category examines the relationships between knowledge enablers andorganizational performance The purpose of these studies is to sharpen the under-standing of the effects of knowledge enablers (eg knowledge management strategy)

Figure 1 An Integrative Research Framework for Studying Knowledge Management

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 183

on organizational performance (eg return on assets [ROA] or return on sales [ROS])Bierly and Chakrabarti [11] tried to identify how knowledge management strategiesaffect organizational performance They analyzed knowledge strategies of 21 USpharmaceutical companies that had been categorized into explorers exploiters lon-ers and innovators Simonin [104] tested the relationships among collaborative expe-rience know-how and achievement of organizational performance He proposed thatthe experience of a firm has to be transformed into know-how before it could improveorganizational performance

The emphasis of the fourth category is on relationships among knowledge enablersknowledge processes and organizational performance The primary objective of thesestudies is to identify and assess knowledge enablers (eg task or infrastructure capa-bilities) and processes (eg creation or their capabilities) for improving organiza-tional performance (eg knowledge satisfaction or organizational effectiveness)Becerra-Fernandez and Sabherwal [8] proposed a contingency framework includingtwo attributes of the organizational subunitrsquos tasksmdashprocess or content orientationand focused or broad domainmdashand linked them to Nonakarsquos knowledge creationprocess [82] The relationship between knowledge creation process and knowledgesatisfaction was also investigated Gold et al [35] analyzed two relationships one

Figure 2 Research Models for Studying Knowledge Management

184 LEE AND CHOI

between infrastructure capabilities and organizational effectiveness and the otherbetween process capabilities and organizational effectiveness Table 1 compares theseprevious studies

Synthesis of Previous Studies

Synthesis of previous studies yields some observations First an integrative model isstill missing Although some studies investigate the relationships among knowledgeenablers processes or organizational performance [8 35] they fail to explore therelationships between enablers and processes simultaneously If managers understandthese relationships in an integrative fashion they can stand a better chance of improv-ing their firmrsquos performance

Second the role of knowledge management processes is not consistent Some stud-ies recognized both knowledge enablers and processes as antecedents of organiza-tional performance [8 35] Other studies recognized knowledge enablers aspreconditions of knowledge processes [6 43 114 124] Therefore the challenge isto clarify the role of knowledge management processes [108]

Third measuring knowledge management performance is still difficult Some stud-ies captured the contribution by the use of knowledge management outcome mea-sures such as knowledge satisfaction [8] whereas others adopted conventionalperformance measures such as ROA [11 104] or organizational effectiveness [35] Itwould appear that the former studies take the relationship between knowledge man-agement outcome and organizational performance for granted although the relation-ship has not been validated The results of the latter studies should be examinedcarefully because the direct relationship between knowledge management processesand organizational performance has not been validated yet [18]

Fourth the knowledge transfer process has been studied extensively [6 43 114124] whereas the other processes such as creation or utilization have received rela-tively little attention In particular some studies have suggested that knowledge cre-ation is most critical for an organizationrsquos long-term success [30] Moreover knowledgetransfer has been assessed by the use of object-perspective measures such as time totransfer [124] number of times of knowledge transfer [6] or percentage of trans-ferred knowledge [43] Recently some researchers have tried to measure knowledgeprocesses themselves [8 35] For example Becerra-Fernandez and Sabherwal [8]measured the capacity for knowledge creation by Nonakarsquos knowledge creation modelnot by the use of creation output such as the number of created ideas or patents

A Research Model

OUR OBJECTIVE IS NEITHER TO PROPOSE a model that delineates all of the relation-ships underlying knowledge management nor to generate a longer list of possibleknowledge enablers or processes that affect organizational performance Therefore

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 185

Tabl

e 1

A C

ompa

riso

n of

Pre

viou

s St

udie

s

Org

aniz

atio

nal

Stud

yK

M e

nabl

ers

KM

pro

cess

espe

rfor

man

ceFi

ndin

gs

Rel

atio

nshi

p am

ong

enab

lers

Ben

net a

nd G

abrie

l [10

]S

truc

ture

NA

NA

Effe

ct o

f cha

nge-

frie

ndly

cul

ture

Cul

ture

on th

e nu

mbe

r of

KM

met

hods

Siz

eem

ploy

ed

Env

ironm

ent

KM

met

ho

d

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

roce

sses

Zan

der

and

Kog

ut [1

24]

Cha

ract

eris

tics

ofTr

ansf

er (

tim

e to

NA

Cod

ifiab

ility

tea

chab

ility

and

soci

etal

kno

wle

dge

tran

sfer

)pa

ralle

l dev

elop

men

t hav

esi

gnifi

cant

effe

cts

on th

e tim

eto

tran

sfer

App

leya

rd [6

]In

dust

ry a

ndTr

ansf

er (

nu

mb

er o

fN

Apu

blic

sou

rces

of k

now

ledg

ena

tiona

l cha

ract

eris

tics

tim

es t

he

resp

on

den

tsar

e m

uch

mor

e pr

eval

ent i

np

rovi

de

and

rec

eive

know

ledg

e tr

ansf

er in

kno

wle

dg

e in

a g

iven

sem

icon

duct

ors

than

in th

ep

erio

d)

stee

l ind

ustr

yP

ublic

sou

rces

of t

echn

ical

know

ledg

e pl

ay a

larg

er r

ole

inkn

owle

dge

tran

sfer

in J

apan

than

in th

e U

nite

d S

tate

s(c

onti

nues

)

186 LEE AND CHOI

Tabl

e 1

(C

ontin

ued)

Org

aniz

atio

nal

Stud

yK

M e

nabl

ers

KM

pro

cess

espe

rfor

man

ceFi

ndin

gs

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

roce

sses

(co

ntin

ued)

Szu

lans

ki [1

14]

Cha

ract

eris

tics

ofTr

ansf

er (

fou

r-st

age

NA

Rec

ipie

ntrsquos

lack

of a

bsor

ptiv

eth

e kn

owle

dge

tran

sfer

pro

cess

es)

capa

city

cau

sal a

mbi

guity

and

tran

sfer

red

sour

cean

ard

uous

ness

of t

here

cipi

ent c

onte

xt

rela

tions

hip

are

the

maj

orim

pedi

men

ts to

kno

wle

dge

tran

sfer

Han

sen

[43]

Wea

k tie

s (d

ista

ntTr

ansf

er (

per

cen

tag

eN

AW

eak

ties

impe

de th

e tr

ansf

eran

d in

freq

uent

of

a p

roje

ctrsquos

to

tal

of c

ompl

ex k

now

ledg

ere

latio

nshi

ps)

kno

wle

dg

e th

atK

now

ledg

eco

me

fro

m o

ther

char

acte

rist

ics

div

isio

ns)

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

erfo

rman

ce

Bie

rly

and

KM

str

ateg

yN

AR

OS

Inno

vato

rs a

nd e

xplo

rers

are

Cha

krab

arti

[11]

RO

Am

ore

prof

itabl

e th

an e

xplo

iters

and

lone

rs

Sim

onin

[104

]C

olla

bora

tive

NA

Tan

gib

le b

enef

its

Col

labo

rativ

e kn

ow-h

ow a

llow

sex

perie

nce

(RO

I R

OA

)fir

ms

to a

chie

ve g

reat

erC

olla

bora

tive

Inta

ng

ible

ben

efit

sor

gani

zatio

nal b

enef

its

know

-how

colla

bora

tive

expe

rien

ce a

lone

does

not

ens

ure

that

a fi

rm w

illbe

nefit

from

a c

olla

bora

tion

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 187

Rel

atio

nshi

p am

ong

know

ledg

e en

able

rs p

roce

sses

and

per

form

ance

Bec

erra

-Fer

nand

ez a

ndTa

sk (

proc

ess

orC

reat

ion

(soc

ializ

atio

nK

M s

atis

fact

ion

Soc

ializ

atio

n is

sui

tabl

e fo

rS

abhe

rwal

[8]

cont

ent o

rien

tatio

nex

tern

aliz

atio

nbr

oad

and

proc

ess-

orie

nted

focu

sed

orco

mbi

natio

nta

sks

ext

erna

lizat

ion

for

broa

d do

mai

n)

inte

rnal

izat

ion)

fo

cuse

d an

d co

nten

t-or

ient

edta

sks

com

bina

tion

for

broa

dan

d co

nten

t-or

ient

ed ta

sks

and

inte

rnal

izat

ion

for

focu

ses

and

proc

ess-

orie

nted

task

sco

mbi

natio

n an

dex

tern

aliz

atio

n af

fect

know

ledg

e sa

tisfa

ctio

n

Gol

d et

al

[35]

Infr

astr

uctu

re c

apab

ility

Pro

cess

cap

abili

tyO

rgan

izat

ion

alIn

fras

truc

ture

and

pro

cess

(tec

hnol

ogy

str

uctu

re

(acq

uisi

tion

con

vers

ion

effe

ctiv

enes

sca

pabi

litie

s co

ntrib

ute

to th

ecu

lture

)ap

plic

atio

n p

rote

ctio

n)

achi

evem

ent o

f org

aniz

atio

nal

effe

ctiv

enes

s

Not

e B

oldf

ace

type

ind

icat

es d

epen

dent

var

iabl

es

188 LEE AND CHOI

our model highlights a few major factors that can explain a large proportion of thevariance in knowledge management

Variables

Enablers

A variety of knowledge management enablers have been addressed in the literature[57 70 97] Among these enablers organizational culture structure people and ITare incorporated into our research model Organizational culture is the most impor-tant factor for successful knowledge management [15 20 21 35] Culture definesnot only what knowledge is valued but also what knowledge must be kept inside theorganization for sustained innovative advantage [71] Organizations should establishan appropriate culture that encourages people to create and share knowledge withinan organization [49 70] This study focuses on collaboration trust and learning onthe basis of the concept of care [29] Care is a key enabler for organizational relation-ships [68] When organizational relationships are fostered through care knowledgecan be created and shared

The organizational structure within an organization may encourage or inhibit knowl-edge management [35 47 82] For example Ichijo et al [57] insisted that firmsshould maintain consistency between their structures to put their knowledge to useOur study includes two key structural factors such as centralization and formalization[77] They are recognized as key variables underlying the structural construct More-over their effects on knowledge management within organizations are widely recog-nized to be potent [29 59 72 91]

People are at the heart of creating organizational knowledge [15 49 80] It is peoplewho create and share knowledge Therefore managing people who are willing tocreate and share knowledge is important [85] Knowledge and competence can beacquired by admitting new people with desirable skills [108] In particular T-shapedskills embodied in employees are most often associated with core capability [56 6070] T-shaped skills may enable individual specialists to have synergistic conversa-tions with one another [74]

Technology contributes to knowledge management [35] This technology infra-structure includes IT and its capabilities [90 99] IT is widely employed to connectpeople with reusable codified knowledge and it facilitates conversations to createnew knowledge Among technology-related variables this study focuses on IT sup-port [108] ITs allow an organization to create share store and use knowledge [70]Therefore the support of IT is essential for initiating and carrying out knowledgemanagement

Enablers may be structured based upon a socio-technical theory [86] This theorydescribes an organization from the social and technical perspectives The two per-spectives are not unique to management information systems (MIS) research [12]they are made up of two jointly independent but correlative interacting componentsOrganizational culture organizational structure and people are social enablers IT is

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 189

a technical enabler For the sake of clarity we consider the impact of each knowledgeenabler independently

Processes

A number of studies have addressed knowledge management processes they divideknowledge management into several processes For example Alavi and Leidner [2]considered four processes such as creation storage transfer and application Theseprocesses are often concurrent and not always in a linear sequence [9]

Among these processes creation-related activities (for example creation [2] orconstruction [21]) become important because knowledge creation is a strategic weaponin todayrsquos global marketplace without the constant creation of knowledge a businessis condemned to obsolescence [83 87] Knowledge creation is a continuous processwhereby individuals and groups within a firm and between firms share tacit and ex-plicit knowledge [82] Although a great deal has been discussed about the importanceof knowledge creation there is relatively little empirical evidence [90] Thereforethe emphasis of this study is on knowledge creation

To explore knowledge creation our study adopts the SECI (socializationexternalization combination internalization) model by Nonaka and Takeuchi [82]for the following reasons First their work has become widely accepted [98] it hasbeen used in many research areas such as organizational learning new product devel-opment and IT [98 99] Second their model includes not only knowledge creationbut also knowledge transfer The transfer of existing knowledge and the creation ofnew knowledge are important and both of them should be considered in knowledgemanagement [69] Their SECI model is made up of four intertwined activity modessocialization (S) externalization (E) combination (C) and internalization (I) Social-ization converts tacit knowledge into new tacit knowledge through social interactionsamong members Externalization codifies tacit knowledge into explicit concepts Com-bination converts explicit knowledge into more systematic sets by combining keypieces Internalization embodies explicit knowledge into tacit knowledge

Intermediate Outcome

In order to achieve a better understanding of knowledge management performancecompanies should attempt to link knowledge processes with intermediate outcomes[18] An important intermediate outcome is organizational creativity which pro-vides a key to the understanding of organizational effectiveness and survival [122]Our model incorporates organizational creativity because it is the seed of all innova-tion [5] and at the very heart of knowledge management [40] Organizational cre-ativity transforms knowledge into business value Neglecting organizational creativitycan quickly undermine a business The relationship between knowledge creationand organizational creativity has received relatively little attention despite its highpotential [119]

190 LEE AND CHOI

Organizational Performance

Measuring organizational performance is not a trivial task because it strongly affectsthe behavior of managers and employees The ultimate test of any business is whetherit leads to measurable improvements in organizational performance

Methods for measuring organizational performance in knowledge management canbe categorized into four groups financial measures [11] intellectual capital [110]tangible and intangible benefits [104] and balanced scorecard [63] This study adoptsa specific measure which is developed and validated by Deshpande et al [22] andDrew [25] This measure can be thought of as a variation of the balanced scorecardmethod The balanced scorecard retains financial performance and supplements itwith measures on the drivers of future potential In addition it is more useful thanintellectual capital or a tangible and intangible approach because it shows cause andeffect links between knowledge components and organization strategies [63]

In summary our empirical research model illustrates the relationship among vari-ables as shown in Figure 3 In total the model consists of 13 variables

Hypotheses

Our hypotheses are largely derived from theoretical statements made in the litera-ture on knowledge management We present our hypotheses through the followingvariables

Collaboration

Collaboration may be defined as the degree to which people in a group actively helpone another in their work [55] Collaborative culture affects knowledge creation throughincreasing knowledge exchange [68 79] Exchanging knowledge among differentmembers is a prerequisite for knowledge creation Collaborative culture fosters thistype of exchange by reducing fear and increasing openness to other members Forexample Zucker et al [126] confirmed the significance of collaborative culture inknowledge creation by examining the biotechnology industry Collaboration betweenorganizational members also tightens individual differences [70] It can help peopledevelop a shared understanding about an organizationrsquos external and internal envi-ronments through supportive and reflective communication Without shared under-standing among organizational members little knowledge is ever created [30 47]We do not have a priori reason to expect a different relationship

H1 There is a positive relationship between collaboration and knowledge cre-ation process

Trust

Trust can be defined as maintaining reciprocal faith in each other in terms of intentionand behaviors [67] Trust may facilitate open substantive and influential knowledge

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 191

exchange [81 85] When their relationships are high in trust people are more willingto participate in knowledge exchange [79] Szulanski [114] empirically found thatthe lack of trust among employees is one of the key barriers against knowledge ex-change The increase in knowledge exchange brought on by mutual trust results inknowledge creation Trust also encourages a climate conducive to better knowledgecreation by alleviating the fear of risk The presence of a high level of trust can reducethis risk [81 92 100] Trust is also critical in a cross-functional or interorganizationalteam because withholding information because of a lack of trust can be especiallyharmful to knowledge creation [47 59] Therefore we would expect the followingrelationship to hold true

H2 There is a positive relationship between trust and knowledge creation process

Learning

Learning can be defined as the degree to which it is encouraged in organizations [55]The emphasis on learning infuses an organization with new knowledge [17] Learningis the acquisition of new knowledge by people who are able and willing to apply thatknowledge in making decisions or influencing others [78] Through the emphasis onlearning and development organizations can help individuals play more active rolesin knowledge creation Kanevsky and Housel [62] insisted that the amount of timespent on learning is positively related with the amount of knowledge For successfulknowledge creation organizations should develop a deeply ingrained learning culture

Figure 3 A Research Model

192 LEE AND CHOI

[88] and provide various learning means such as education training and mentoring[112 113] For example Nucor [39] which has been the most innovative steel com-pany in the United States built a knowledge creation foundation by investing in con-tinuous and multifunctional training programs Hence we hypothesize

H3 There is a positive relationship between learning and knowledge creationprocess

Centralization

Centralization refers to the locus of decision authority and control within an organi-zational entity [14 27] The concentration of decision-making authority inevitablyreduces creative solutions whereas the dispersion of power facilitates spontaneityexperimentation and the freedom of expression which are the lifeblood of knowl-edge creation [37] Moreover centralized structure hinders interdepartmental com-munication and frequent sharing of ideas [122] due to time-consuming communicationchannels [10] it also causes distortion and discontinuousness of ideas [108] Withouta constant flow of communication and ideas knowledge creation does not occur Adecentralized organizational structure has been found to facilitate an environmentwhere employees participate in knowledge building process more spontaneously [52]Participatory work environments foster knowledge creation by motivating organiza-tional membersrsquo involvements Therefore decreased centralization in the form of lo-cus of authority can lead to increased creation of knowledge [106 108 115] Weadvance the fourth hypothesis

H4 There is a negative relationship between centralization and knowledge cre-ation process

Formalization

Formalization refers to the degree to which decisions and working relationships aregoverned by formal rules standard policies and procedures [49 89] Knowledgecreation requires flexibility and less emphasis on work rules [57 73] The range ofnew ideas seems to be restricted when strict formal rules dominate an organizationFlexibility can accommodate better ways of doing things [37] Therefore the in-creased flexibility in an organizational structure can result in increased creation ofknowledge Knowledge creation also requires variation [121] In order to be moreadaptable when unforeseen problems arise an organization may accommodate varia-tion in process and structure Low formalization permits openness and variation whichencourage new ideas and behaviors [17] Knowledge creation is also likely to beencouraged through unhindered communications and interactions [10] Formalitystifles the communication and interaction necessary to create knowledge Lack offormal structure tends to enable organizational members to communicate and interactwith one another to create knowledge [59] Hence we hypothesize

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 193

H5 There is a negative relationship between formalization and knowledge cre-ation process

T-Shaped Skills

T-shaped skills are both deep (the vertical part of the ldquoTrdquo) and broad (the horizontalpart of the ldquoTrdquo) that is their possessors can explore particular knowledge domainsand their various applications in particular products [70] For example persons withT-shaped skills not only have a deep knowledge of a discipline (like ceramic materi-als engineering) but also know how their discipline interacts with other disciplines(such as polymer processing) [56] People with T-shaped skills are extremely valu-able for creating knowledge because they can integrate diverse knowledge assets [70]They have the ability both to combine theoretical and practical knowledge and to seehow their branch of knowledge interacts with other branches Therefore they canexpand their competence across several functional branch areas and thus create newknowledge [60 74]

H6 There is a positive relationship between the presence of the organizationalmembers with T-shaped skills and knowledge creation process

IT Support

IT support means the degree to which knowledge management is supported by theuse of ITs [35] Many researchers have found that IT is a crucial element for knowl-edge creation [19 36 39] IT affects knowledge in a variety of ways First IT facili-tates rapid collection storage and exchange of knowledge on a scale not practicablein the past thereby assisting the knowledge creation process [92] Second a well-developed technology integrates fragmented flows of knowledge [35] This integra-tion can eliminate barriers to communication among departments in organizationThird IT fosters all modes of knowledge creation and is not limited to the transfer ofexplicit knowledge [90 91 99] For instance InfoTESTrsquos enhanced product realiza-tion (EPR) project employs electronic whiteboarding and videoconferencing to en-hance exchanges of tacit knowledge [91] Thus we hypothesize

H7 There is a positive relationship between IT support and knowledge creationprocess

Organizational Creativity

Organizational creativity is the capability of creating valuable and useful productsservices ideas or procedures by individuals working together in a complex socialsystem [5 122] Knowledge plays an important role in the ability of the organizationto be creative [119] Thus organizations with better knowledge diffusion and creat-ing mechanisms are more intelligent [34] Organizational creativity also connectsand rearranges knowledge to create new often surprising ideas that others judge to be

194 LEE AND CHOI

useful [65] Creativity is not necessarily related to the amount of knowledge that anemployee possesses but rather the way in which knowledge is created and shared [4]The processes of knowledge creation unleash organizational creativity Naturallyorganizational creativity has a strong link with knowledge creation [119]

H8 There is a positive relationship between the knowledge creation process andorganizational creativity

Organizational Performance

In our study organizational performance is assessed by the use of global output mea-sures such as market share profitability growth rate innovativeness successfulnessand the size of business in comparison with key competitors [22 25] In a knowl-edge-based economy organizational creativity represents a dramatic organizationalchange Robinson and Stern [93] insisted that the tangible results of corporate cre-ativity are the organizational change such as improvements (changes to what is al-ready done) and innovations (entirely new activities for the company) Withoutcreativity organizations may fail to adapt to changing internal and external condi-tions [88] and thus lose their knowledge advantage Typically the goals of organiza-tional change include the various aspects of organizational performance such asorganizational effectiveness survival improvement or innovation Organizationalperformance can be thought of as the output of a process that encourages creativity[97] Thus improvements of creativity might lead to better organizational perfor-mance [18 88 102] We hypothesize that

H9 There is a positive relationship between organizational creativity and orga-nizational performance

Sample and Measures

SAMPLES WERE RESTRICTED TO THE LISTED COMPANIES in order to include majorcompanies in Korea Annual Corporation Reports by Maeil Business Newspaper [75]is the source for sampling because it analyzes all listed companies in the Korea StockExchange Therefore the unit of analysis in this study is the organization We adoptedboth interviews and mail surveys Interviews were used to investigate the currentdetailed status of knowledge management This investigation included knowledgemanagement practices such as the number of communities of practice the rate of useof the knowledge management system and the cost of investment in knowledge man-agement activities Although interview data is not analyzed statistically they werevaluable for our interpretation

After the interview a questionnaire-based survey was conducted Questionnaireswere administered to a total of 1425 middle managers in 147 organizations Depend-ing on each individual firmrsquos size five to 15 middle managers were surveyed fromeach firm Middle managers were reached through their CEOs or CIOs A typical jobtitle of a middle manager was department chief Middle managers were surveyed

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 195

because they played key roles in managing knowledge Middle managers are posi-tioned at the intersection of the vertical and horizontal flows of knowledge Thusthey can synthesize the tacit knowledge of both top managers and frontline employ-ees make it explicit and incorporate it into new products and services [82]

A multiple-item method was used to construct the questionnaires Each item wasbased on a six-point Likert scale from ldquovery lowrdquo to ldquovery highrdquo Likert scales asgenerally used tend to underestimate the extreme positions [3] Respondents are re-luctant to express an extreme position even if they have it They tend to please theinterviewer appear helpful or respond in what they perceive to be a socially accept-able answer Resorting to a scale without a midpoint seems to help mollify this socialdesirability bias without changing the direction of opinion [32] The six-point Likertscale avoids a midpoint which prevents respondents from using a neutral defaultoption [5] The questionnaires were written in Korean

Research constructs were operationalized on the basis of related studies and pilottests The operational definitions of instruments and their related literature are sum-marized in Appendix A Most of the research constructs have already been validatedand used for other studies on knowledge management organizational design learn-ing or IT management For example formalization items have already been vali-dated and used by Caruana et al [14] and Rapert and Wren [89] Self-reported itemshave been used to assess organizational performance [22 25] Although these itemsdo not present a fully balanced scorecard they are effective for comparing businessunits and industries [25] Questionnaire items for the knowledge creation processwhich were used in this study had been validated and used by Nonaka et al [83]

Analysis

Sample Characteristics

IN TOTAL 451 QUESTIONNAIRES FROM 63 out of 147 firms were returned (43 percentresponse rate) The rates from individual firms ranged from 23 to 100 percent Due toincomplete data 25 responses from five firms were eliminated Consequently 426responses from 58 firms were analyzed Table 2 summarizes the respondent charac-teristics in terms of industry type departments total sales revenue and number oftotal employees

Samples are divided into three industry types manufacturing service and finan-cial business (banking finance insurance) The majority of these firms are in theservice industry Thirty-two firms have annual total sales revenue of $1 billion ormore and 31 firms have 1000 employees or more As mentioned previously sampleswere collected from various middle managers

Reliability and Validity Analysis

Table 3 presents the results of reliability and validity tests An analysis was performedon the 36 items that measured the components of knowledge enablers other analyses

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 183

on organizational performance (eg return on assets [ROA] or return on sales [ROS])Bierly and Chakrabarti [11] tried to identify how knowledge management strategiesaffect organizational performance They analyzed knowledge strategies of 21 USpharmaceutical companies that had been categorized into explorers exploiters lon-ers and innovators Simonin [104] tested the relationships among collaborative expe-rience know-how and achievement of organizational performance He proposed thatthe experience of a firm has to be transformed into know-how before it could improveorganizational performance

The emphasis of the fourth category is on relationships among knowledge enablersknowledge processes and organizational performance The primary objective of thesestudies is to identify and assess knowledge enablers (eg task or infrastructure capa-bilities) and processes (eg creation or their capabilities) for improving organiza-tional performance (eg knowledge satisfaction or organizational effectiveness)Becerra-Fernandez and Sabherwal [8] proposed a contingency framework includingtwo attributes of the organizational subunitrsquos tasksmdashprocess or content orientationand focused or broad domainmdashand linked them to Nonakarsquos knowledge creationprocess [82] The relationship between knowledge creation process and knowledgesatisfaction was also investigated Gold et al [35] analyzed two relationships one

Figure 2 Research Models for Studying Knowledge Management

184 LEE AND CHOI

between infrastructure capabilities and organizational effectiveness and the otherbetween process capabilities and organizational effectiveness Table 1 compares theseprevious studies

Synthesis of Previous Studies

Synthesis of previous studies yields some observations First an integrative model isstill missing Although some studies investigate the relationships among knowledgeenablers processes or organizational performance [8 35] they fail to explore therelationships between enablers and processes simultaneously If managers understandthese relationships in an integrative fashion they can stand a better chance of improv-ing their firmrsquos performance

Second the role of knowledge management processes is not consistent Some stud-ies recognized both knowledge enablers and processes as antecedents of organiza-tional performance [8 35] Other studies recognized knowledge enablers aspreconditions of knowledge processes [6 43 114 124] Therefore the challenge isto clarify the role of knowledge management processes [108]

Third measuring knowledge management performance is still difficult Some stud-ies captured the contribution by the use of knowledge management outcome mea-sures such as knowledge satisfaction [8] whereas others adopted conventionalperformance measures such as ROA [11 104] or organizational effectiveness [35] Itwould appear that the former studies take the relationship between knowledge man-agement outcome and organizational performance for granted although the relation-ship has not been validated The results of the latter studies should be examinedcarefully because the direct relationship between knowledge management processesand organizational performance has not been validated yet [18]

Fourth the knowledge transfer process has been studied extensively [6 43 114124] whereas the other processes such as creation or utilization have received rela-tively little attention In particular some studies have suggested that knowledge cre-ation is most critical for an organizationrsquos long-term success [30] Moreover knowledgetransfer has been assessed by the use of object-perspective measures such as time totransfer [124] number of times of knowledge transfer [6] or percentage of trans-ferred knowledge [43] Recently some researchers have tried to measure knowledgeprocesses themselves [8 35] For example Becerra-Fernandez and Sabherwal [8]measured the capacity for knowledge creation by Nonakarsquos knowledge creation modelnot by the use of creation output such as the number of created ideas or patents

A Research Model

OUR OBJECTIVE IS NEITHER TO PROPOSE a model that delineates all of the relation-ships underlying knowledge management nor to generate a longer list of possibleknowledge enablers or processes that affect organizational performance Therefore

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 185

Tabl

e 1

A C

ompa

riso

n of

Pre

viou

s St

udie

s

Org

aniz

atio

nal

Stud

yK

M e

nabl

ers

KM

pro

cess

espe

rfor

man

ceFi

ndin

gs

Rel

atio

nshi

p am

ong

enab

lers

Ben

net a

nd G

abrie

l [10

]S

truc

ture

NA

NA

Effe

ct o

f cha

nge-

frie

ndly

cul

ture

Cul

ture

on th

e nu

mbe

r of

KM

met

hods

Siz

eem

ploy

ed

Env

ironm

ent

KM

met

ho

d

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

roce

sses

Zan

der

and

Kog

ut [1

24]

Cha

ract

eris

tics

ofTr

ansf

er (

tim

e to

NA

Cod

ifiab

ility

tea

chab

ility

and

soci

etal

kno

wle

dge

tran

sfer

)pa

ralle

l dev

elop

men

t hav

esi

gnifi

cant

effe

cts

on th

e tim

eto

tran

sfer

App

leya

rd [6

]In

dust

ry a

ndTr

ansf

er (

nu

mb

er o

fN

Apu

blic

sou

rces

of k

now

ledg

ena

tiona

l cha

ract

eris

tics

tim

es t

he

resp

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den

tsar

e m

uch

mor

e pr

eval

ent i

np

rovi

de

and

rec

eive

know

ledg

e tr

ansf

er in

kno

wle

dg

e in

a g

iven

sem

icon

duct

ors

than

in th

ep

erio

d)

stee

l ind

ustr

yP

ublic

sou

rces

of t

echn

ical

know

ledg

e pl

ay a

larg

er r

ole

inkn

owle

dge

tran

sfer

in J

apan

than

in th

e U

nite

d S

tate

s(c

onti

nues

)

186 LEE AND CHOI

Tabl

e 1

(C

ontin

ued)

Org

aniz

atio

nal

Stud

yK

M e

nabl

ers

KM

pro

cess

espe

rfor

man

ceFi

ndin

gs

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

roce

sses

(co

ntin

ued)

Szu

lans

ki [1

14]

Cha

ract

eris

tics

ofTr

ansf

er (

fou

r-st

age

NA

Rec

ipie

ntrsquos

lack

of a

bsor

ptiv

eth

e kn

owle

dge

tran

sfer

pro

cess

es)

capa

city

cau

sal a

mbi

guity

and

tran

sfer

red

sour

cean

ard

uous

ness

of t

here

cipi

ent c

onte

xt

rela

tions

hip

are

the

maj

orim

pedi

men

ts to

kno

wle

dge

tran

sfer

Han

sen

[43]

Wea

k tie

s (d

ista

ntTr

ansf

er (

per

cen

tag

eN

AW

eak

ties

impe

de th

e tr

ansf

eran

d in

freq

uent

of

a p

roje

ctrsquos

to

tal

of c

ompl

ex k

now

ledg

ere

latio

nshi

ps)

kno

wle

dg

e th

atK

now

ledg

eco

me

fro

m o

ther

char

acte

rist

ics

div

isio

ns)

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

erfo

rman

ce

Bie

rly

and

KM

str

ateg

yN

AR

OS

Inno

vato

rs a

nd e

xplo

rers

are

Cha

krab

arti

[11]

RO

Am

ore

prof

itabl

e th

an e

xplo

iters

and

lone

rs

Sim

onin

[104

]C

olla

bora

tive

NA

Tan

gib

le b

enef

its

Col

labo

rativ

e kn

ow-h

ow a

llow

sex

perie

nce

(RO

I R

OA

)fir

ms

to a

chie

ve g

reat

erC

olla

bora

tive

Inta

ng

ible

ben

efit

sor

gani

zatio

nal b

enef

its

know

-how

colla

bora

tive

expe

rien

ce a

lone

does

not

ens

ure

that

a fi

rm w

illbe

nefit

from

a c

olla

bora

tion

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 187

Rel

atio

nshi

p am

ong

know

ledg

e en

able

rs p

roce

sses

and

per

form

ance

Bec

erra

-Fer

nand

ez a

ndTa

sk (

proc

ess

orC

reat

ion

(soc

ializ

atio

nK

M s

atis

fact

ion

Soc

ializ

atio

n is

sui

tabl

e fo

rS

abhe

rwal

[8]

cont

ent o

rien

tatio

nex

tern

aliz

atio

nbr

oad

and

proc

ess-

orie

nted

focu

sed

orco

mbi

natio

nta

sks

ext

erna

lizat

ion

for

broa

d do

mai

n)

inte

rnal

izat

ion)

fo

cuse

d an

d co

nten

t-or

ient

edta

sks

com

bina

tion

for

broa

dan

d co

nten

t-or

ient

ed ta

sks

and

inte

rnal

izat

ion

for

focu

ses

and

proc

ess-

orie

nted

task

sco

mbi

natio

n an

dex

tern

aliz

atio

n af

fect

know

ledg

e sa

tisfa

ctio

n

Gol

d et

al

[35]

Infr

astr

uctu

re c

apab

ility

Pro

cess

cap

abili

tyO

rgan

izat

ion

alIn

fras

truc

ture

and

pro

cess

(tec

hnol

ogy

str

uctu

re

(acq

uisi

tion

con

vers

ion

effe

ctiv

enes

sca

pabi

litie

s co

ntrib

ute

to th

ecu

lture

)ap

plic

atio

n p

rote

ctio

n)

achi

evem

ent o

f org

aniz

atio

nal

effe

ctiv

enes

s

Not

e B

oldf

ace

type

ind

icat

es d

epen

dent

var

iabl

es

188 LEE AND CHOI

our model highlights a few major factors that can explain a large proportion of thevariance in knowledge management

Variables

Enablers

A variety of knowledge management enablers have been addressed in the literature[57 70 97] Among these enablers organizational culture structure people and ITare incorporated into our research model Organizational culture is the most impor-tant factor for successful knowledge management [15 20 21 35] Culture definesnot only what knowledge is valued but also what knowledge must be kept inside theorganization for sustained innovative advantage [71] Organizations should establishan appropriate culture that encourages people to create and share knowledge withinan organization [49 70] This study focuses on collaboration trust and learning onthe basis of the concept of care [29] Care is a key enabler for organizational relation-ships [68] When organizational relationships are fostered through care knowledgecan be created and shared

The organizational structure within an organization may encourage or inhibit knowl-edge management [35 47 82] For example Ichijo et al [57] insisted that firmsshould maintain consistency between their structures to put their knowledge to useOur study includes two key structural factors such as centralization and formalization[77] They are recognized as key variables underlying the structural construct More-over their effects on knowledge management within organizations are widely recog-nized to be potent [29 59 72 91]

People are at the heart of creating organizational knowledge [15 49 80] It is peoplewho create and share knowledge Therefore managing people who are willing tocreate and share knowledge is important [85] Knowledge and competence can beacquired by admitting new people with desirable skills [108] In particular T-shapedskills embodied in employees are most often associated with core capability [56 6070] T-shaped skills may enable individual specialists to have synergistic conversa-tions with one another [74]

Technology contributes to knowledge management [35] This technology infra-structure includes IT and its capabilities [90 99] IT is widely employed to connectpeople with reusable codified knowledge and it facilitates conversations to createnew knowledge Among technology-related variables this study focuses on IT sup-port [108] ITs allow an organization to create share store and use knowledge [70]Therefore the support of IT is essential for initiating and carrying out knowledgemanagement

Enablers may be structured based upon a socio-technical theory [86] This theorydescribes an organization from the social and technical perspectives The two per-spectives are not unique to management information systems (MIS) research [12]they are made up of two jointly independent but correlative interacting componentsOrganizational culture organizational structure and people are social enablers IT is

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 189

a technical enabler For the sake of clarity we consider the impact of each knowledgeenabler independently

Processes

A number of studies have addressed knowledge management processes they divideknowledge management into several processes For example Alavi and Leidner [2]considered four processes such as creation storage transfer and application Theseprocesses are often concurrent and not always in a linear sequence [9]

Among these processes creation-related activities (for example creation [2] orconstruction [21]) become important because knowledge creation is a strategic weaponin todayrsquos global marketplace without the constant creation of knowledge a businessis condemned to obsolescence [83 87] Knowledge creation is a continuous processwhereby individuals and groups within a firm and between firms share tacit and ex-plicit knowledge [82] Although a great deal has been discussed about the importanceof knowledge creation there is relatively little empirical evidence [90] Thereforethe emphasis of this study is on knowledge creation

To explore knowledge creation our study adopts the SECI (socializationexternalization combination internalization) model by Nonaka and Takeuchi [82]for the following reasons First their work has become widely accepted [98] it hasbeen used in many research areas such as organizational learning new product devel-opment and IT [98 99] Second their model includes not only knowledge creationbut also knowledge transfer The transfer of existing knowledge and the creation ofnew knowledge are important and both of them should be considered in knowledgemanagement [69] Their SECI model is made up of four intertwined activity modessocialization (S) externalization (E) combination (C) and internalization (I) Social-ization converts tacit knowledge into new tacit knowledge through social interactionsamong members Externalization codifies tacit knowledge into explicit concepts Com-bination converts explicit knowledge into more systematic sets by combining keypieces Internalization embodies explicit knowledge into tacit knowledge

Intermediate Outcome

In order to achieve a better understanding of knowledge management performancecompanies should attempt to link knowledge processes with intermediate outcomes[18] An important intermediate outcome is organizational creativity which pro-vides a key to the understanding of organizational effectiveness and survival [122]Our model incorporates organizational creativity because it is the seed of all innova-tion [5] and at the very heart of knowledge management [40] Organizational cre-ativity transforms knowledge into business value Neglecting organizational creativitycan quickly undermine a business The relationship between knowledge creationand organizational creativity has received relatively little attention despite its highpotential [119]

190 LEE AND CHOI

Organizational Performance

Measuring organizational performance is not a trivial task because it strongly affectsthe behavior of managers and employees The ultimate test of any business is whetherit leads to measurable improvements in organizational performance

Methods for measuring organizational performance in knowledge management canbe categorized into four groups financial measures [11] intellectual capital [110]tangible and intangible benefits [104] and balanced scorecard [63] This study adoptsa specific measure which is developed and validated by Deshpande et al [22] andDrew [25] This measure can be thought of as a variation of the balanced scorecardmethod The balanced scorecard retains financial performance and supplements itwith measures on the drivers of future potential In addition it is more useful thanintellectual capital or a tangible and intangible approach because it shows cause andeffect links between knowledge components and organization strategies [63]

In summary our empirical research model illustrates the relationship among vari-ables as shown in Figure 3 In total the model consists of 13 variables

Hypotheses

Our hypotheses are largely derived from theoretical statements made in the litera-ture on knowledge management We present our hypotheses through the followingvariables

Collaboration

Collaboration may be defined as the degree to which people in a group actively helpone another in their work [55] Collaborative culture affects knowledge creation throughincreasing knowledge exchange [68 79] Exchanging knowledge among differentmembers is a prerequisite for knowledge creation Collaborative culture fosters thistype of exchange by reducing fear and increasing openness to other members Forexample Zucker et al [126] confirmed the significance of collaborative culture inknowledge creation by examining the biotechnology industry Collaboration betweenorganizational members also tightens individual differences [70] It can help peopledevelop a shared understanding about an organizationrsquos external and internal envi-ronments through supportive and reflective communication Without shared under-standing among organizational members little knowledge is ever created [30 47]We do not have a priori reason to expect a different relationship

H1 There is a positive relationship between collaboration and knowledge cre-ation process

Trust

Trust can be defined as maintaining reciprocal faith in each other in terms of intentionand behaviors [67] Trust may facilitate open substantive and influential knowledge

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 191

exchange [81 85] When their relationships are high in trust people are more willingto participate in knowledge exchange [79] Szulanski [114] empirically found thatthe lack of trust among employees is one of the key barriers against knowledge ex-change The increase in knowledge exchange brought on by mutual trust results inknowledge creation Trust also encourages a climate conducive to better knowledgecreation by alleviating the fear of risk The presence of a high level of trust can reducethis risk [81 92 100] Trust is also critical in a cross-functional or interorganizationalteam because withholding information because of a lack of trust can be especiallyharmful to knowledge creation [47 59] Therefore we would expect the followingrelationship to hold true

H2 There is a positive relationship between trust and knowledge creation process

Learning

Learning can be defined as the degree to which it is encouraged in organizations [55]The emphasis on learning infuses an organization with new knowledge [17] Learningis the acquisition of new knowledge by people who are able and willing to apply thatknowledge in making decisions or influencing others [78] Through the emphasis onlearning and development organizations can help individuals play more active rolesin knowledge creation Kanevsky and Housel [62] insisted that the amount of timespent on learning is positively related with the amount of knowledge For successfulknowledge creation organizations should develop a deeply ingrained learning culture

Figure 3 A Research Model

192 LEE AND CHOI

[88] and provide various learning means such as education training and mentoring[112 113] For example Nucor [39] which has been the most innovative steel com-pany in the United States built a knowledge creation foundation by investing in con-tinuous and multifunctional training programs Hence we hypothesize

H3 There is a positive relationship between learning and knowledge creationprocess

Centralization

Centralization refers to the locus of decision authority and control within an organi-zational entity [14 27] The concentration of decision-making authority inevitablyreduces creative solutions whereas the dispersion of power facilitates spontaneityexperimentation and the freedom of expression which are the lifeblood of knowl-edge creation [37] Moreover centralized structure hinders interdepartmental com-munication and frequent sharing of ideas [122] due to time-consuming communicationchannels [10] it also causes distortion and discontinuousness of ideas [108] Withouta constant flow of communication and ideas knowledge creation does not occur Adecentralized organizational structure has been found to facilitate an environmentwhere employees participate in knowledge building process more spontaneously [52]Participatory work environments foster knowledge creation by motivating organiza-tional membersrsquo involvements Therefore decreased centralization in the form of lo-cus of authority can lead to increased creation of knowledge [106 108 115] Weadvance the fourth hypothesis

H4 There is a negative relationship between centralization and knowledge cre-ation process

Formalization

Formalization refers to the degree to which decisions and working relationships aregoverned by formal rules standard policies and procedures [49 89] Knowledgecreation requires flexibility and less emphasis on work rules [57 73] The range ofnew ideas seems to be restricted when strict formal rules dominate an organizationFlexibility can accommodate better ways of doing things [37] Therefore the in-creased flexibility in an organizational structure can result in increased creation ofknowledge Knowledge creation also requires variation [121] In order to be moreadaptable when unforeseen problems arise an organization may accommodate varia-tion in process and structure Low formalization permits openness and variation whichencourage new ideas and behaviors [17] Knowledge creation is also likely to beencouraged through unhindered communications and interactions [10] Formalitystifles the communication and interaction necessary to create knowledge Lack offormal structure tends to enable organizational members to communicate and interactwith one another to create knowledge [59] Hence we hypothesize

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 193

H5 There is a negative relationship between formalization and knowledge cre-ation process

T-Shaped Skills

T-shaped skills are both deep (the vertical part of the ldquoTrdquo) and broad (the horizontalpart of the ldquoTrdquo) that is their possessors can explore particular knowledge domainsand their various applications in particular products [70] For example persons withT-shaped skills not only have a deep knowledge of a discipline (like ceramic materi-als engineering) but also know how their discipline interacts with other disciplines(such as polymer processing) [56] People with T-shaped skills are extremely valu-able for creating knowledge because they can integrate diverse knowledge assets [70]They have the ability both to combine theoretical and practical knowledge and to seehow their branch of knowledge interacts with other branches Therefore they canexpand their competence across several functional branch areas and thus create newknowledge [60 74]

H6 There is a positive relationship between the presence of the organizationalmembers with T-shaped skills and knowledge creation process

IT Support

IT support means the degree to which knowledge management is supported by theuse of ITs [35] Many researchers have found that IT is a crucial element for knowl-edge creation [19 36 39] IT affects knowledge in a variety of ways First IT facili-tates rapid collection storage and exchange of knowledge on a scale not practicablein the past thereby assisting the knowledge creation process [92] Second a well-developed technology integrates fragmented flows of knowledge [35] This integra-tion can eliminate barriers to communication among departments in organizationThird IT fosters all modes of knowledge creation and is not limited to the transfer ofexplicit knowledge [90 91 99] For instance InfoTESTrsquos enhanced product realiza-tion (EPR) project employs electronic whiteboarding and videoconferencing to en-hance exchanges of tacit knowledge [91] Thus we hypothesize

H7 There is a positive relationship between IT support and knowledge creationprocess

Organizational Creativity

Organizational creativity is the capability of creating valuable and useful productsservices ideas or procedures by individuals working together in a complex socialsystem [5 122] Knowledge plays an important role in the ability of the organizationto be creative [119] Thus organizations with better knowledge diffusion and creat-ing mechanisms are more intelligent [34] Organizational creativity also connectsand rearranges knowledge to create new often surprising ideas that others judge to be

194 LEE AND CHOI

useful [65] Creativity is not necessarily related to the amount of knowledge that anemployee possesses but rather the way in which knowledge is created and shared [4]The processes of knowledge creation unleash organizational creativity Naturallyorganizational creativity has a strong link with knowledge creation [119]

H8 There is a positive relationship between the knowledge creation process andorganizational creativity

Organizational Performance

In our study organizational performance is assessed by the use of global output mea-sures such as market share profitability growth rate innovativeness successfulnessand the size of business in comparison with key competitors [22 25] In a knowl-edge-based economy organizational creativity represents a dramatic organizationalchange Robinson and Stern [93] insisted that the tangible results of corporate cre-ativity are the organizational change such as improvements (changes to what is al-ready done) and innovations (entirely new activities for the company) Withoutcreativity organizations may fail to adapt to changing internal and external condi-tions [88] and thus lose their knowledge advantage Typically the goals of organiza-tional change include the various aspects of organizational performance such asorganizational effectiveness survival improvement or innovation Organizationalperformance can be thought of as the output of a process that encourages creativity[97] Thus improvements of creativity might lead to better organizational perfor-mance [18 88 102] We hypothesize that

H9 There is a positive relationship between organizational creativity and orga-nizational performance

Sample and Measures

SAMPLES WERE RESTRICTED TO THE LISTED COMPANIES in order to include majorcompanies in Korea Annual Corporation Reports by Maeil Business Newspaper [75]is the source for sampling because it analyzes all listed companies in the Korea StockExchange Therefore the unit of analysis in this study is the organization We adoptedboth interviews and mail surveys Interviews were used to investigate the currentdetailed status of knowledge management This investigation included knowledgemanagement practices such as the number of communities of practice the rate of useof the knowledge management system and the cost of investment in knowledge man-agement activities Although interview data is not analyzed statistically they werevaluable for our interpretation

After the interview a questionnaire-based survey was conducted Questionnaireswere administered to a total of 1425 middle managers in 147 organizations Depend-ing on each individual firmrsquos size five to 15 middle managers were surveyed fromeach firm Middle managers were reached through their CEOs or CIOs A typical jobtitle of a middle manager was department chief Middle managers were surveyed

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 195

because they played key roles in managing knowledge Middle managers are posi-tioned at the intersection of the vertical and horizontal flows of knowledge Thusthey can synthesize the tacit knowledge of both top managers and frontline employ-ees make it explicit and incorporate it into new products and services [82]

A multiple-item method was used to construct the questionnaires Each item wasbased on a six-point Likert scale from ldquovery lowrdquo to ldquovery highrdquo Likert scales asgenerally used tend to underestimate the extreme positions [3] Respondents are re-luctant to express an extreme position even if they have it They tend to please theinterviewer appear helpful or respond in what they perceive to be a socially accept-able answer Resorting to a scale without a midpoint seems to help mollify this socialdesirability bias without changing the direction of opinion [32] The six-point Likertscale avoids a midpoint which prevents respondents from using a neutral defaultoption [5] The questionnaires were written in Korean

Research constructs were operationalized on the basis of related studies and pilottests The operational definitions of instruments and their related literature are sum-marized in Appendix A Most of the research constructs have already been validatedand used for other studies on knowledge management organizational design learn-ing or IT management For example formalization items have already been vali-dated and used by Caruana et al [14] and Rapert and Wren [89] Self-reported itemshave been used to assess organizational performance [22 25] Although these itemsdo not present a fully balanced scorecard they are effective for comparing businessunits and industries [25] Questionnaire items for the knowledge creation processwhich were used in this study had been validated and used by Nonaka et al [83]

Analysis

Sample Characteristics

IN TOTAL 451 QUESTIONNAIRES FROM 63 out of 147 firms were returned (43 percentresponse rate) The rates from individual firms ranged from 23 to 100 percent Due toincomplete data 25 responses from five firms were eliminated Consequently 426responses from 58 firms were analyzed Table 2 summarizes the respondent charac-teristics in terms of industry type departments total sales revenue and number oftotal employees

Samples are divided into three industry types manufacturing service and finan-cial business (banking finance insurance) The majority of these firms are in theservice industry Thirty-two firms have annual total sales revenue of $1 billion ormore and 31 firms have 1000 employees or more As mentioned previously sampleswere collected from various middle managers

Reliability and Validity Analysis

Table 3 presents the results of reliability and validity tests An analysis was performedon the 36 items that measured the components of knowledge enablers other analyses

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

184 LEE AND CHOI

between infrastructure capabilities and organizational effectiveness and the otherbetween process capabilities and organizational effectiveness Table 1 compares theseprevious studies

Synthesis of Previous Studies

Synthesis of previous studies yields some observations First an integrative model isstill missing Although some studies investigate the relationships among knowledgeenablers processes or organizational performance [8 35] they fail to explore therelationships between enablers and processes simultaneously If managers understandthese relationships in an integrative fashion they can stand a better chance of improv-ing their firmrsquos performance

Second the role of knowledge management processes is not consistent Some stud-ies recognized both knowledge enablers and processes as antecedents of organiza-tional performance [8 35] Other studies recognized knowledge enablers aspreconditions of knowledge processes [6 43 114 124] Therefore the challenge isto clarify the role of knowledge management processes [108]

Third measuring knowledge management performance is still difficult Some stud-ies captured the contribution by the use of knowledge management outcome mea-sures such as knowledge satisfaction [8] whereas others adopted conventionalperformance measures such as ROA [11 104] or organizational effectiveness [35] Itwould appear that the former studies take the relationship between knowledge man-agement outcome and organizational performance for granted although the relation-ship has not been validated The results of the latter studies should be examinedcarefully because the direct relationship between knowledge management processesand organizational performance has not been validated yet [18]

Fourth the knowledge transfer process has been studied extensively [6 43 114124] whereas the other processes such as creation or utilization have received rela-tively little attention In particular some studies have suggested that knowledge cre-ation is most critical for an organizationrsquos long-term success [30] Moreover knowledgetransfer has been assessed by the use of object-perspective measures such as time totransfer [124] number of times of knowledge transfer [6] or percentage of trans-ferred knowledge [43] Recently some researchers have tried to measure knowledgeprocesses themselves [8 35] For example Becerra-Fernandez and Sabherwal [8]measured the capacity for knowledge creation by Nonakarsquos knowledge creation modelnot by the use of creation output such as the number of created ideas or patents

A Research Model

OUR OBJECTIVE IS NEITHER TO PROPOSE a model that delineates all of the relation-ships underlying knowledge management nor to generate a longer list of possibleknowledge enablers or processes that affect organizational performance Therefore

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 185

Tabl

e 1

A C

ompa

riso

n of

Pre

viou

s St

udie

s

Org

aniz

atio

nal

Stud

yK

M e

nabl

ers

KM

pro

cess

espe

rfor

man

ceFi

ndin

gs

Rel

atio

nshi

p am

ong

enab

lers

Ben

net a

nd G

abrie

l [10

]S

truc

ture

NA

NA

Effe

ct o

f cha

nge-

frie

ndly

cul

ture

Cul

ture

on th

e nu

mbe

r of

KM

met

hods

Siz

eem

ploy

ed

Env

ironm

ent

KM

met

ho

d

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

roce

sses

Zan

der

and

Kog

ut [1

24]

Cha

ract

eris

tics

ofTr

ansf

er (

tim

e to

NA

Cod

ifiab

ility

tea

chab

ility

and

soci

etal

kno

wle

dge

tran

sfer

)pa

ralle

l dev

elop

men

t hav

esi

gnifi

cant

effe

cts

on th

e tim

eto

tran

sfer

App

leya

rd [6

]In

dust

ry a

ndTr

ansf

er (

nu

mb

er o

fN

Apu

blic

sou

rces

of k

now

ledg

ena

tiona

l cha

ract

eris

tics

tim

es t

he

resp

on

den

tsar

e m

uch

mor

e pr

eval

ent i

np

rovi

de

and

rec

eive

know

ledg

e tr

ansf

er in

kno

wle

dg

e in

a g

iven

sem

icon

duct

ors

than

in th

ep

erio

d)

stee

l ind

ustr

yP

ublic

sou

rces

of t

echn

ical

know

ledg

e pl

ay a

larg

er r

ole

inkn

owle

dge

tran

sfer

in J

apan

than

in th

e U

nite

d S

tate

s(c

onti

nues

)

186 LEE AND CHOI

Tabl

e 1

(C

ontin

ued)

Org

aniz

atio

nal

Stud

yK

M e

nabl

ers

KM

pro

cess

espe

rfor

man

ceFi

ndin

gs

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

roce

sses

(co

ntin

ued)

Szu

lans

ki [1

14]

Cha

ract

eris

tics

ofTr

ansf

er (

fou

r-st

age

NA

Rec

ipie

ntrsquos

lack

of a

bsor

ptiv

eth

e kn

owle

dge

tran

sfer

pro

cess

es)

capa

city

cau

sal a

mbi

guity

and

tran

sfer

red

sour

cean

ard

uous

ness

of t

here

cipi

ent c

onte

xt

rela

tions

hip

are

the

maj

orim

pedi

men

ts to

kno

wle

dge

tran

sfer

Han

sen

[43]

Wea

k tie

s (d

ista

ntTr

ansf

er (

per

cen

tag

eN

AW

eak

ties

impe

de th

e tr

ansf

eran

d in

freq

uent

of

a p

roje

ctrsquos

to

tal

of c

ompl

ex k

now

ledg

ere

latio

nshi

ps)

kno

wle

dg

e th

atK

now

ledg

eco

me

fro

m o

ther

char

acte

rist

ics

div

isio

ns)

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

erfo

rman

ce

Bie

rly

and

KM

str

ateg

yN

AR

OS

Inno

vato

rs a

nd e

xplo

rers

are

Cha

krab

arti

[11]

RO

Am

ore

prof

itabl

e th

an e

xplo

iters

and

lone

rs

Sim

onin

[104

]C

olla

bora

tive

NA

Tan

gib

le b

enef

its

Col

labo

rativ

e kn

ow-h

ow a

llow

sex

perie

nce

(RO

I R

OA

)fir

ms

to a

chie

ve g

reat

erC

olla

bora

tive

Inta

ng

ible

ben

efit

sor

gani

zatio

nal b

enef

its

know

-how

colla

bora

tive

expe

rien

ce a

lone

does

not

ens

ure

that

a fi

rm w

illbe

nefit

from

a c

olla

bora

tion

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 187

Rel

atio

nshi

p am

ong

know

ledg

e en

able

rs p

roce

sses

and

per

form

ance

Bec

erra

-Fer

nand

ez a

ndTa

sk (

proc

ess

orC

reat

ion

(soc

ializ

atio

nK

M s

atis

fact

ion

Soc

ializ

atio

n is

sui

tabl

e fo

rS

abhe

rwal

[8]

cont

ent o

rien

tatio

nex

tern

aliz

atio

nbr

oad

and

proc

ess-

orie

nted

focu

sed

orco

mbi

natio

nta

sks

ext

erna

lizat

ion

for

broa

d do

mai

n)

inte

rnal

izat

ion)

fo

cuse

d an

d co

nten

t-or

ient

edta

sks

com

bina

tion

for

broa

dan

d co

nten

t-or

ient

ed ta

sks

and

inte

rnal

izat

ion

for

focu

ses

and

proc

ess-

orie

nted

task

sco

mbi

natio

n an

dex

tern

aliz

atio

n af

fect

know

ledg

e sa

tisfa

ctio

n

Gol

d et

al

[35]

Infr

astr

uctu

re c

apab

ility

Pro

cess

cap

abili

tyO

rgan

izat

ion

alIn

fras

truc

ture

and

pro

cess

(tec

hnol

ogy

str

uctu

re

(acq

uisi

tion

con

vers

ion

effe

ctiv

enes

sca

pabi

litie

s co

ntrib

ute

to th

ecu

lture

)ap

plic

atio

n p

rote

ctio

n)

achi

evem

ent o

f org

aniz

atio

nal

effe

ctiv

enes

s

Not

e B

oldf

ace

type

ind

icat

es d

epen

dent

var

iabl

es

188 LEE AND CHOI

our model highlights a few major factors that can explain a large proportion of thevariance in knowledge management

Variables

Enablers

A variety of knowledge management enablers have been addressed in the literature[57 70 97] Among these enablers organizational culture structure people and ITare incorporated into our research model Organizational culture is the most impor-tant factor for successful knowledge management [15 20 21 35] Culture definesnot only what knowledge is valued but also what knowledge must be kept inside theorganization for sustained innovative advantage [71] Organizations should establishan appropriate culture that encourages people to create and share knowledge withinan organization [49 70] This study focuses on collaboration trust and learning onthe basis of the concept of care [29] Care is a key enabler for organizational relation-ships [68] When organizational relationships are fostered through care knowledgecan be created and shared

The organizational structure within an organization may encourage or inhibit knowl-edge management [35 47 82] For example Ichijo et al [57] insisted that firmsshould maintain consistency between their structures to put their knowledge to useOur study includes two key structural factors such as centralization and formalization[77] They are recognized as key variables underlying the structural construct More-over their effects on knowledge management within organizations are widely recog-nized to be potent [29 59 72 91]

People are at the heart of creating organizational knowledge [15 49 80] It is peoplewho create and share knowledge Therefore managing people who are willing tocreate and share knowledge is important [85] Knowledge and competence can beacquired by admitting new people with desirable skills [108] In particular T-shapedskills embodied in employees are most often associated with core capability [56 6070] T-shaped skills may enable individual specialists to have synergistic conversa-tions with one another [74]

Technology contributes to knowledge management [35] This technology infra-structure includes IT and its capabilities [90 99] IT is widely employed to connectpeople with reusable codified knowledge and it facilitates conversations to createnew knowledge Among technology-related variables this study focuses on IT sup-port [108] ITs allow an organization to create share store and use knowledge [70]Therefore the support of IT is essential for initiating and carrying out knowledgemanagement

Enablers may be structured based upon a socio-technical theory [86] This theorydescribes an organization from the social and technical perspectives The two per-spectives are not unique to management information systems (MIS) research [12]they are made up of two jointly independent but correlative interacting componentsOrganizational culture organizational structure and people are social enablers IT is

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 189

a technical enabler For the sake of clarity we consider the impact of each knowledgeenabler independently

Processes

A number of studies have addressed knowledge management processes they divideknowledge management into several processes For example Alavi and Leidner [2]considered four processes such as creation storage transfer and application Theseprocesses are often concurrent and not always in a linear sequence [9]

Among these processes creation-related activities (for example creation [2] orconstruction [21]) become important because knowledge creation is a strategic weaponin todayrsquos global marketplace without the constant creation of knowledge a businessis condemned to obsolescence [83 87] Knowledge creation is a continuous processwhereby individuals and groups within a firm and between firms share tacit and ex-plicit knowledge [82] Although a great deal has been discussed about the importanceof knowledge creation there is relatively little empirical evidence [90] Thereforethe emphasis of this study is on knowledge creation

To explore knowledge creation our study adopts the SECI (socializationexternalization combination internalization) model by Nonaka and Takeuchi [82]for the following reasons First their work has become widely accepted [98] it hasbeen used in many research areas such as organizational learning new product devel-opment and IT [98 99] Second their model includes not only knowledge creationbut also knowledge transfer The transfer of existing knowledge and the creation ofnew knowledge are important and both of them should be considered in knowledgemanagement [69] Their SECI model is made up of four intertwined activity modessocialization (S) externalization (E) combination (C) and internalization (I) Social-ization converts tacit knowledge into new tacit knowledge through social interactionsamong members Externalization codifies tacit knowledge into explicit concepts Com-bination converts explicit knowledge into more systematic sets by combining keypieces Internalization embodies explicit knowledge into tacit knowledge

Intermediate Outcome

In order to achieve a better understanding of knowledge management performancecompanies should attempt to link knowledge processes with intermediate outcomes[18] An important intermediate outcome is organizational creativity which pro-vides a key to the understanding of organizational effectiveness and survival [122]Our model incorporates organizational creativity because it is the seed of all innova-tion [5] and at the very heart of knowledge management [40] Organizational cre-ativity transforms knowledge into business value Neglecting organizational creativitycan quickly undermine a business The relationship between knowledge creationand organizational creativity has received relatively little attention despite its highpotential [119]

190 LEE AND CHOI

Organizational Performance

Measuring organizational performance is not a trivial task because it strongly affectsthe behavior of managers and employees The ultimate test of any business is whetherit leads to measurable improvements in organizational performance

Methods for measuring organizational performance in knowledge management canbe categorized into four groups financial measures [11] intellectual capital [110]tangible and intangible benefits [104] and balanced scorecard [63] This study adoptsa specific measure which is developed and validated by Deshpande et al [22] andDrew [25] This measure can be thought of as a variation of the balanced scorecardmethod The balanced scorecard retains financial performance and supplements itwith measures on the drivers of future potential In addition it is more useful thanintellectual capital or a tangible and intangible approach because it shows cause andeffect links between knowledge components and organization strategies [63]

In summary our empirical research model illustrates the relationship among vari-ables as shown in Figure 3 In total the model consists of 13 variables

Hypotheses

Our hypotheses are largely derived from theoretical statements made in the litera-ture on knowledge management We present our hypotheses through the followingvariables

Collaboration

Collaboration may be defined as the degree to which people in a group actively helpone another in their work [55] Collaborative culture affects knowledge creation throughincreasing knowledge exchange [68 79] Exchanging knowledge among differentmembers is a prerequisite for knowledge creation Collaborative culture fosters thistype of exchange by reducing fear and increasing openness to other members Forexample Zucker et al [126] confirmed the significance of collaborative culture inknowledge creation by examining the biotechnology industry Collaboration betweenorganizational members also tightens individual differences [70] It can help peopledevelop a shared understanding about an organizationrsquos external and internal envi-ronments through supportive and reflective communication Without shared under-standing among organizational members little knowledge is ever created [30 47]We do not have a priori reason to expect a different relationship

H1 There is a positive relationship between collaboration and knowledge cre-ation process

Trust

Trust can be defined as maintaining reciprocal faith in each other in terms of intentionand behaviors [67] Trust may facilitate open substantive and influential knowledge

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 191

exchange [81 85] When their relationships are high in trust people are more willingto participate in knowledge exchange [79] Szulanski [114] empirically found thatthe lack of trust among employees is one of the key barriers against knowledge ex-change The increase in knowledge exchange brought on by mutual trust results inknowledge creation Trust also encourages a climate conducive to better knowledgecreation by alleviating the fear of risk The presence of a high level of trust can reducethis risk [81 92 100] Trust is also critical in a cross-functional or interorganizationalteam because withholding information because of a lack of trust can be especiallyharmful to knowledge creation [47 59] Therefore we would expect the followingrelationship to hold true

H2 There is a positive relationship between trust and knowledge creation process

Learning

Learning can be defined as the degree to which it is encouraged in organizations [55]The emphasis on learning infuses an organization with new knowledge [17] Learningis the acquisition of new knowledge by people who are able and willing to apply thatknowledge in making decisions or influencing others [78] Through the emphasis onlearning and development organizations can help individuals play more active rolesin knowledge creation Kanevsky and Housel [62] insisted that the amount of timespent on learning is positively related with the amount of knowledge For successfulknowledge creation organizations should develop a deeply ingrained learning culture

Figure 3 A Research Model

192 LEE AND CHOI

[88] and provide various learning means such as education training and mentoring[112 113] For example Nucor [39] which has been the most innovative steel com-pany in the United States built a knowledge creation foundation by investing in con-tinuous and multifunctional training programs Hence we hypothesize

H3 There is a positive relationship between learning and knowledge creationprocess

Centralization

Centralization refers to the locus of decision authority and control within an organi-zational entity [14 27] The concentration of decision-making authority inevitablyreduces creative solutions whereas the dispersion of power facilitates spontaneityexperimentation and the freedom of expression which are the lifeblood of knowl-edge creation [37] Moreover centralized structure hinders interdepartmental com-munication and frequent sharing of ideas [122] due to time-consuming communicationchannels [10] it also causes distortion and discontinuousness of ideas [108] Withouta constant flow of communication and ideas knowledge creation does not occur Adecentralized organizational structure has been found to facilitate an environmentwhere employees participate in knowledge building process more spontaneously [52]Participatory work environments foster knowledge creation by motivating organiza-tional membersrsquo involvements Therefore decreased centralization in the form of lo-cus of authority can lead to increased creation of knowledge [106 108 115] Weadvance the fourth hypothesis

H4 There is a negative relationship between centralization and knowledge cre-ation process

Formalization

Formalization refers to the degree to which decisions and working relationships aregoverned by formal rules standard policies and procedures [49 89] Knowledgecreation requires flexibility and less emphasis on work rules [57 73] The range ofnew ideas seems to be restricted when strict formal rules dominate an organizationFlexibility can accommodate better ways of doing things [37] Therefore the in-creased flexibility in an organizational structure can result in increased creation ofknowledge Knowledge creation also requires variation [121] In order to be moreadaptable when unforeseen problems arise an organization may accommodate varia-tion in process and structure Low formalization permits openness and variation whichencourage new ideas and behaviors [17] Knowledge creation is also likely to beencouraged through unhindered communications and interactions [10] Formalitystifles the communication and interaction necessary to create knowledge Lack offormal structure tends to enable organizational members to communicate and interactwith one another to create knowledge [59] Hence we hypothesize

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 193

H5 There is a negative relationship between formalization and knowledge cre-ation process

T-Shaped Skills

T-shaped skills are both deep (the vertical part of the ldquoTrdquo) and broad (the horizontalpart of the ldquoTrdquo) that is their possessors can explore particular knowledge domainsand their various applications in particular products [70] For example persons withT-shaped skills not only have a deep knowledge of a discipline (like ceramic materi-als engineering) but also know how their discipline interacts with other disciplines(such as polymer processing) [56] People with T-shaped skills are extremely valu-able for creating knowledge because they can integrate diverse knowledge assets [70]They have the ability both to combine theoretical and practical knowledge and to seehow their branch of knowledge interacts with other branches Therefore they canexpand their competence across several functional branch areas and thus create newknowledge [60 74]

H6 There is a positive relationship between the presence of the organizationalmembers with T-shaped skills and knowledge creation process

IT Support

IT support means the degree to which knowledge management is supported by theuse of ITs [35] Many researchers have found that IT is a crucial element for knowl-edge creation [19 36 39] IT affects knowledge in a variety of ways First IT facili-tates rapid collection storage and exchange of knowledge on a scale not practicablein the past thereby assisting the knowledge creation process [92] Second a well-developed technology integrates fragmented flows of knowledge [35] This integra-tion can eliminate barriers to communication among departments in organizationThird IT fosters all modes of knowledge creation and is not limited to the transfer ofexplicit knowledge [90 91 99] For instance InfoTESTrsquos enhanced product realiza-tion (EPR) project employs electronic whiteboarding and videoconferencing to en-hance exchanges of tacit knowledge [91] Thus we hypothesize

H7 There is a positive relationship between IT support and knowledge creationprocess

Organizational Creativity

Organizational creativity is the capability of creating valuable and useful productsservices ideas or procedures by individuals working together in a complex socialsystem [5 122] Knowledge plays an important role in the ability of the organizationto be creative [119] Thus organizations with better knowledge diffusion and creat-ing mechanisms are more intelligent [34] Organizational creativity also connectsand rearranges knowledge to create new often surprising ideas that others judge to be

194 LEE AND CHOI

useful [65] Creativity is not necessarily related to the amount of knowledge that anemployee possesses but rather the way in which knowledge is created and shared [4]The processes of knowledge creation unleash organizational creativity Naturallyorganizational creativity has a strong link with knowledge creation [119]

H8 There is a positive relationship between the knowledge creation process andorganizational creativity

Organizational Performance

In our study organizational performance is assessed by the use of global output mea-sures such as market share profitability growth rate innovativeness successfulnessand the size of business in comparison with key competitors [22 25] In a knowl-edge-based economy organizational creativity represents a dramatic organizationalchange Robinson and Stern [93] insisted that the tangible results of corporate cre-ativity are the organizational change such as improvements (changes to what is al-ready done) and innovations (entirely new activities for the company) Withoutcreativity organizations may fail to adapt to changing internal and external condi-tions [88] and thus lose their knowledge advantage Typically the goals of organiza-tional change include the various aspects of organizational performance such asorganizational effectiveness survival improvement or innovation Organizationalperformance can be thought of as the output of a process that encourages creativity[97] Thus improvements of creativity might lead to better organizational perfor-mance [18 88 102] We hypothesize that

H9 There is a positive relationship between organizational creativity and orga-nizational performance

Sample and Measures

SAMPLES WERE RESTRICTED TO THE LISTED COMPANIES in order to include majorcompanies in Korea Annual Corporation Reports by Maeil Business Newspaper [75]is the source for sampling because it analyzes all listed companies in the Korea StockExchange Therefore the unit of analysis in this study is the organization We adoptedboth interviews and mail surveys Interviews were used to investigate the currentdetailed status of knowledge management This investigation included knowledgemanagement practices such as the number of communities of practice the rate of useof the knowledge management system and the cost of investment in knowledge man-agement activities Although interview data is not analyzed statistically they werevaluable for our interpretation

After the interview a questionnaire-based survey was conducted Questionnaireswere administered to a total of 1425 middle managers in 147 organizations Depend-ing on each individual firmrsquos size five to 15 middle managers were surveyed fromeach firm Middle managers were reached through their CEOs or CIOs A typical jobtitle of a middle manager was department chief Middle managers were surveyed

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 195

because they played key roles in managing knowledge Middle managers are posi-tioned at the intersection of the vertical and horizontal flows of knowledge Thusthey can synthesize the tacit knowledge of both top managers and frontline employ-ees make it explicit and incorporate it into new products and services [82]

A multiple-item method was used to construct the questionnaires Each item wasbased on a six-point Likert scale from ldquovery lowrdquo to ldquovery highrdquo Likert scales asgenerally used tend to underestimate the extreme positions [3] Respondents are re-luctant to express an extreme position even if they have it They tend to please theinterviewer appear helpful or respond in what they perceive to be a socially accept-able answer Resorting to a scale without a midpoint seems to help mollify this socialdesirability bias without changing the direction of opinion [32] The six-point Likertscale avoids a midpoint which prevents respondents from using a neutral defaultoption [5] The questionnaires were written in Korean

Research constructs were operationalized on the basis of related studies and pilottests The operational definitions of instruments and their related literature are sum-marized in Appendix A Most of the research constructs have already been validatedand used for other studies on knowledge management organizational design learn-ing or IT management For example formalization items have already been vali-dated and used by Caruana et al [14] and Rapert and Wren [89] Self-reported itemshave been used to assess organizational performance [22 25] Although these itemsdo not present a fully balanced scorecard they are effective for comparing businessunits and industries [25] Questionnaire items for the knowledge creation processwhich were used in this study had been validated and used by Nonaka et al [83]

Analysis

Sample Characteristics

IN TOTAL 451 QUESTIONNAIRES FROM 63 out of 147 firms were returned (43 percentresponse rate) The rates from individual firms ranged from 23 to 100 percent Due toincomplete data 25 responses from five firms were eliminated Consequently 426responses from 58 firms were analyzed Table 2 summarizes the respondent charac-teristics in terms of industry type departments total sales revenue and number oftotal employees

Samples are divided into three industry types manufacturing service and finan-cial business (banking finance insurance) The majority of these firms are in theservice industry Thirty-two firms have annual total sales revenue of $1 billion ormore and 31 firms have 1000 employees or more As mentioned previously sampleswere collected from various middle managers

Reliability and Validity Analysis

Table 3 presents the results of reliability and validity tests An analysis was performedon the 36 items that measured the components of knowledge enablers other analyses

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 185

Tabl

e 1

A C

ompa

riso

n of

Pre

viou

s St

udie

s

Org

aniz

atio

nal

Stud

yK

M e

nabl

ers

KM

pro

cess

espe

rfor

man

ceFi

ndin

gs

Rel

atio

nshi

p am

ong

enab

lers

Ben

net a

nd G

abrie

l [10

]S

truc

ture

NA

NA

Effe

ct o

f cha

nge-

frie

ndly

cul

ture

Cul

ture

on th

e nu

mbe

r of

KM

met

hods

Siz

eem

ploy

ed

Env

ironm

ent

KM

met

ho

d

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

roce

sses

Zan

der

and

Kog

ut [1

24]

Cha

ract

eris

tics

ofTr

ansf

er (

tim

e to

NA

Cod

ifiab

ility

tea

chab

ility

and

soci

etal

kno

wle

dge

tran

sfer

)pa

ralle

l dev

elop

men

t hav

esi

gnifi

cant

effe

cts

on th

e tim

eto

tran

sfer

App

leya

rd [6

]In

dust

ry a

ndTr

ansf

er (

nu

mb

er o

fN

Apu

blic

sou

rces

of k

now

ledg

ena

tiona

l cha

ract

eris

tics

tim

es t

he

resp

on

den

tsar

e m

uch

mor

e pr

eval

ent i

np

rovi

de

and

rec

eive

know

ledg

e tr

ansf

er in

kno

wle

dg

e in

a g

iven

sem

icon

duct

ors

than

in th

ep

erio

d)

stee

l ind

ustr

yP

ublic

sou

rces

of t

echn

ical

know

ledg

e pl

ay a

larg

er r

ole

inkn

owle

dge

tran

sfer

in J

apan

than

in th

e U

nite

d S

tate

s(c

onti

nues

)

186 LEE AND CHOI

Tabl

e 1

(C

ontin

ued)

Org

aniz

atio

nal

Stud

yK

M e

nabl

ers

KM

pro

cess

espe

rfor

man

ceFi

ndin

gs

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

roce

sses

(co

ntin

ued)

Szu

lans

ki [1

14]

Cha

ract

eris

tics

ofTr

ansf

er (

fou

r-st

age

NA

Rec

ipie

ntrsquos

lack

of a

bsor

ptiv

eth

e kn

owle

dge

tran

sfer

pro

cess

es)

capa

city

cau

sal a

mbi

guity

and

tran

sfer

red

sour

cean

ard

uous

ness

of t

here

cipi

ent c

onte

xt

rela

tions

hip

are

the

maj

orim

pedi

men

ts to

kno

wle

dge

tran

sfer

Han

sen

[43]

Wea

k tie

s (d

ista

ntTr

ansf

er (

per

cen

tag

eN

AW

eak

ties

impe

de th

e tr

ansf

eran

d in

freq

uent

of

a p

roje

ctrsquos

to

tal

of c

ompl

ex k

now

ledg

ere

latio

nshi

ps)

kno

wle

dg

e th

atK

now

ledg

eco

me

fro

m o

ther

char

acte

rist

ics

div

isio

ns)

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

erfo

rman

ce

Bie

rly

and

KM

str

ateg

yN

AR

OS

Inno

vato

rs a

nd e

xplo

rers

are

Cha

krab

arti

[11]

RO

Am

ore

prof

itabl

e th

an e

xplo

iters

and

lone

rs

Sim

onin

[104

]C

olla

bora

tive

NA

Tan

gib

le b

enef

its

Col

labo

rativ

e kn

ow-h

ow a

llow

sex

perie

nce

(RO

I R

OA

)fir

ms

to a

chie

ve g

reat

erC

olla

bora

tive

Inta

ng

ible

ben

efit

sor

gani

zatio

nal b

enef

its

know

-how

colla

bora

tive

expe

rien

ce a

lone

does

not

ens

ure

that

a fi

rm w

illbe

nefit

from

a c

olla

bora

tion

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 187

Rel

atio

nshi

p am

ong

know

ledg

e en

able

rs p

roce

sses

and

per

form

ance

Bec

erra

-Fer

nand

ez a

ndTa

sk (

proc

ess

orC

reat

ion

(soc

ializ

atio

nK

M s

atis

fact

ion

Soc

ializ

atio

n is

sui

tabl

e fo

rS

abhe

rwal

[8]

cont

ent o

rien

tatio

nex

tern

aliz

atio

nbr

oad

and

proc

ess-

orie

nted

focu

sed

orco

mbi

natio

nta

sks

ext

erna

lizat

ion

for

broa

d do

mai

n)

inte

rnal

izat

ion)

fo

cuse

d an

d co

nten

t-or

ient

edta

sks

com

bina

tion

for

broa

dan

d co

nten

t-or

ient

ed ta

sks

and

inte

rnal

izat

ion

for

focu

ses

and

proc

ess-

orie

nted

task

sco

mbi

natio

n an

dex

tern

aliz

atio

n af

fect

know

ledg

e sa

tisfa

ctio

n

Gol

d et

al

[35]

Infr

astr

uctu

re c

apab

ility

Pro

cess

cap

abili

tyO

rgan

izat

ion

alIn

fras

truc

ture

and

pro

cess

(tec

hnol

ogy

str

uctu

re

(acq

uisi

tion

con

vers

ion

effe

ctiv

enes

sca

pabi

litie

s co

ntrib

ute

to th

ecu

lture

)ap

plic

atio

n p

rote

ctio

n)

achi

evem

ent o

f org

aniz

atio

nal

effe

ctiv

enes

s

Not

e B

oldf

ace

type

ind

icat

es d

epen

dent

var

iabl

es

188 LEE AND CHOI

our model highlights a few major factors that can explain a large proportion of thevariance in knowledge management

Variables

Enablers

A variety of knowledge management enablers have been addressed in the literature[57 70 97] Among these enablers organizational culture structure people and ITare incorporated into our research model Organizational culture is the most impor-tant factor for successful knowledge management [15 20 21 35] Culture definesnot only what knowledge is valued but also what knowledge must be kept inside theorganization for sustained innovative advantage [71] Organizations should establishan appropriate culture that encourages people to create and share knowledge withinan organization [49 70] This study focuses on collaboration trust and learning onthe basis of the concept of care [29] Care is a key enabler for organizational relation-ships [68] When organizational relationships are fostered through care knowledgecan be created and shared

The organizational structure within an organization may encourage or inhibit knowl-edge management [35 47 82] For example Ichijo et al [57] insisted that firmsshould maintain consistency between their structures to put their knowledge to useOur study includes two key structural factors such as centralization and formalization[77] They are recognized as key variables underlying the structural construct More-over their effects on knowledge management within organizations are widely recog-nized to be potent [29 59 72 91]

People are at the heart of creating organizational knowledge [15 49 80] It is peoplewho create and share knowledge Therefore managing people who are willing tocreate and share knowledge is important [85] Knowledge and competence can beacquired by admitting new people with desirable skills [108] In particular T-shapedskills embodied in employees are most often associated with core capability [56 6070] T-shaped skills may enable individual specialists to have synergistic conversa-tions with one another [74]

Technology contributes to knowledge management [35] This technology infra-structure includes IT and its capabilities [90 99] IT is widely employed to connectpeople with reusable codified knowledge and it facilitates conversations to createnew knowledge Among technology-related variables this study focuses on IT sup-port [108] ITs allow an organization to create share store and use knowledge [70]Therefore the support of IT is essential for initiating and carrying out knowledgemanagement

Enablers may be structured based upon a socio-technical theory [86] This theorydescribes an organization from the social and technical perspectives The two per-spectives are not unique to management information systems (MIS) research [12]they are made up of two jointly independent but correlative interacting componentsOrganizational culture organizational structure and people are social enablers IT is

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 189

a technical enabler For the sake of clarity we consider the impact of each knowledgeenabler independently

Processes

A number of studies have addressed knowledge management processes they divideknowledge management into several processes For example Alavi and Leidner [2]considered four processes such as creation storage transfer and application Theseprocesses are often concurrent and not always in a linear sequence [9]

Among these processes creation-related activities (for example creation [2] orconstruction [21]) become important because knowledge creation is a strategic weaponin todayrsquos global marketplace without the constant creation of knowledge a businessis condemned to obsolescence [83 87] Knowledge creation is a continuous processwhereby individuals and groups within a firm and between firms share tacit and ex-plicit knowledge [82] Although a great deal has been discussed about the importanceof knowledge creation there is relatively little empirical evidence [90] Thereforethe emphasis of this study is on knowledge creation

To explore knowledge creation our study adopts the SECI (socializationexternalization combination internalization) model by Nonaka and Takeuchi [82]for the following reasons First their work has become widely accepted [98] it hasbeen used in many research areas such as organizational learning new product devel-opment and IT [98 99] Second their model includes not only knowledge creationbut also knowledge transfer The transfer of existing knowledge and the creation ofnew knowledge are important and both of them should be considered in knowledgemanagement [69] Their SECI model is made up of four intertwined activity modessocialization (S) externalization (E) combination (C) and internalization (I) Social-ization converts tacit knowledge into new tacit knowledge through social interactionsamong members Externalization codifies tacit knowledge into explicit concepts Com-bination converts explicit knowledge into more systematic sets by combining keypieces Internalization embodies explicit knowledge into tacit knowledge

Intermediate Outcome

In order to achieve a better understanding of knowledge management performancecompanies should attempt to link knowledge processes with intermediate outcomes[18] An important intermediate outcome is organizational creativity which pro-vides a key to the understanding of organizational effectiveness and survival [122]Our model incorporates organizational creativity because it is the seed of all innova-tion [5] and at the very heart of knowledge management [40] Organizational cre-ativity transforms knowledge into business value Neglecting organizational creativitycan quickly undermine a business The relationship between knowledge creationand organizational creativity has received relatively little attention despite its highpotential [119]

190 LEE AND CHOI

Organizational Performance

Measuring organizational performance is not a trivial task because it strongly affectsthe behavior of managers and employees The ultimate test of any business is whetherit leads to measurable improvements in organizational performance

Methods for measuring organizational performance in knowledge management canbe categorized into four groups financial measures [11] intellectual capital [110]tangible and intangible benefits [104] and balanced scorecard [63] This study adoptsa specific measure which is developed and validated by Deshpande et al [22] andDrew [25] This measure can be thought of as a variation of the balanced scorecardmethod The balanced scorecard retains financial performance and supplements itwith measures on the drivers of future potential In addition it is more useful thanintellectual capital or a tangible and intangible approach because it shows cause andeffect links between knowledge components and organization strategies [63]

In summary our empirical research model illustrates the relationship among vari-ables as shown in Figure 3 In total the model consists of 13 variables

Hypotheses

Our hypotheses are largely derived from theoretical statements made in the litera-ture on knowledge management We present our hypotheses through the followingvariables

Collaboration

Collaboration may be defined as the degree to which people in a group actively helpone another in their work [55] Collaborative culture affects knowledge creation throughincreasing knowledge exchange [68 79] Exchanging knowledge among differentmembers is a prerequisite for knowledge creation Collaborative culture fosters thistype of exchange by reducing fear and increasing openness to other members Forexample Zucker et al [126] confirmed the significance of collaborative culture inknowledge creation by examining the biotechnology industry Collaboration betweenorganizational members also tightens individual differences [70] It can help peopledevelop a shared understanding about an organizationrsquos external and internal envi-ronments through supportive and reflective communication Without shared under-standing among organizational members little knowledge is ever created [30 47]We do not have a priori reason to expect a different relationship

H1 There is a positive relationship between collaboration and knowledge cre-ation process

Trust

Trust can be defined as maintaining reciprocal faith in each other in terms of intentionand behaviors [67] Trust may facilitate open substantive and influential knowledge

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 191

exchange [81 85] When their relationships are high in trust people are more willingto participate in knowledge exchange [79] Szulanski [114] empirically found thatthe lack of trust among employees is one of the key barriers against knowledge ex-change The increase in knowledge exchange brought on by mutual trust results inknowledge creation Trust also encourages a climate conducive to better knowledgecreation by alleviating the fear of risk The presence of a high level of trust can reducethis risk [81 92 100] Trust is also critical in a cross-functional or interorganizationalteam because withholding information because of a lack of trust can be especiallyharmful to knowledge creation [47 59] Therefore we would expect the followingrelationship to hold true

H2 There is a positive relationship between trust and knowledge creation process

Learning

Learning can be defined as the degree to which it is encouraged in organizations [55]The emphasis on learning infuses an organization with new knowledge [17] Learningis the acquisition of new knowledge by people who are able and willing to apply thatknowledge in making decisions or influencing others [78] Through the emphasis onlearning and development organizations can help individuals play more active rolesin knowledge creation Kanevsky and Housel [62] insisted that the amount of timespent on learning is positively related with the amount of knowledge For successfulknowledge creation organizations should develop a deeply ingrained learning culture

Figure 3 A Research Model

192 LEE AND CHOI

[88] and provide various learning means such as education training and mentoring[112 113] For example Nucor [39] which has been the most innovative steel com-pany in the United States built a knowledge creation foundation by investing in con-tinuous and multifunctional training programs Hence we hypothesize

H3 There is a positive relationship between learning and knowledge creationprocess

Centralization

Centralization refers to the locus of decision authority and control within an organi-zational entity [14 27] The concentration of decision-making authority inevitablyreduces creative solutions whereas the dispersion of power facilitates spontaneityexperimentation and the freedom of expression which are the lifeblood of knowl-edge creation [37] Moreover centralized structure hinders interdepartmental com-munication and frequent sharing of ideas [122] due to time-consuming communicationchannels [10] it also causes distortion and discontinuousness of ideas [108] Withouta constant flow of communication and ideas knowledge creation does not occur Adecentralized organizational structure has been found to facilitate an environmentwhere employees participate in knowledge building process more spontaneously [52]Participatory work environments foster knowledge creation by motivating organiza-tional membersrsquo involvements Therefore decreased centralization in the form of lo-cus of authority can lead to increased creation of knowledge [106 108 115] Weadvance the fourth hypothesis

H4 There is a negative relationship between centralization and knowledge cre-ation process

Formalization

Formalization refers to the degree to which decisions and working relationships aregoverned by formal rules standard policies and procedures [49 89] Knowledgecreation requires flexibility and less emphasis on work rules [57 73] The range ofnew ideas seems to be restricted when strict formal rules dominate an organizationFlexibility can accommodate better ways of doing things [37] Therefore the in-creased flexibility in an organizational structure can result in increased creation ofknowledge Knowledge creation also requires variation [121] In order to be moreadaptable when unforeseen problems arise an organization may accommodate varia-tion in process and structure Low formalization permits openness and variation whichencourage new ideas and behaviors [17] Knowledge creation is also likely to beencouraged through unhindered communications and interactions [10] Formalitystifles the communication and interaction necessary to create knowledge Lack offormal structure tends to enable organizational members to communicate and interactwith one another to create knowledge [59] Hence we hypothesize

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 193

H5 There is a negative relationship between formalization and knowledge cre-ation process

T-Shaped Skills

T-shaped skills are both deep (the vertical part of the ldquoTrdquo) and broad (the horizontalpart of the ldquoTrdquo) that is their possessors can explore particular knowledge domainsand their various applications in particular products [70] For example persons withT-shaped skills not only have a deep knowledge of a discipline (like ceramic materi-als engineering) but also know how their discipline interacts with other disciplines(such as polymer processing) [56] People with T-shaped skills are extremely valu-able for creating knowledge because they can integrate diverse knowledge assets [70]They have the ability both to combine theoretical and practical knowledge and to seehow their branch of knowledge interacts with other branches Therefore they canexpand their competence across several functional branch areas and thus create newknowledge [60 74]

H6 There is a positive relationship between the presence of the organizationalmembers with T-shaped skills and knowledge creation process

IT Support

IT support means the degree to which knowledge management is supported by theuse of ITs [35] Many researchers have found that IT is a crucial element for knowl-edge creation [19 36 39] IT affects knowledge in a variety of ways First IT facili-tates rapid collection storage and exchange of knowledge on a scale not practicablein the past thereby assisting the knowledge creation process [92] Second a well-developed technology integrates fragmented flows of knowledge [35] This integra-tion can eliminate barriers to communication among departments in organizationThird IT fosters all modes of knowledge creation and is not limited to the transfer ofexplicit knowledge [90 91 99] For instance InfoTESTrsquos enhanced product realiza-tion (EPR) project employs electronic whiteboarding and videoconferencing to en-hance exchanges of tacit knowledge [91] Thus we hypothesize

H7 There is a positive relationship between IT support and knowledge creationprocess

Organizational Creativity

Organizational creativity is the capability of creating valuable and useful productsservices ideas or procedures by individuals working together in a complex socialsystem [5 122] Knowledge plays an important role in the ability of the organizationto be creative [119] Thus organizations with better knowledge diffusion and creat-ing mechanisms are more intelligent [34] Organizational creativity also connectsand rearranges knowledge to create new often surprising ideas that others judge to be

194 LEE AND CHOI

useful [65] Creativity is not necessarily related to the amount of knowledge that anemployee possesses but rather the way in which knowledge is created and shared [4]The processes of knowledge creation unleash organizational creativity Naturallyorganizational creativity has a strong link with knowledge creation [119]

H8 There is a positive relationship between the knowledge creation process andorganizational creativity

Organizational Performance

In our study organizational performance is assessed by the use of global output mea-sures such as market share profitability growth rate innovativeness successfulnessand the size of business in comparison with key competitors [22 25] In a knowl-edge-based economy organizational creativity represents a dramatic organizationalchange Robinson and Stern [93] insisted that the tangible results of corporate cre-ativity are the organizational change such as improvements (changes to what is al-ready done) and innovations (entirely new activities for the company) Withoutcreativity organizations may fail to adapt to changing internal and external condi-tions [88] and thus lose their knowledge advantage Typically the goals of organiza-tional change include the various aspects of organizational performance such asorganizational effectiveness survival improvement or innovation Organizationalperformance can be thought of as the output of a process that encourages creativity[97] Thus improvements of creativity might lead to better organizational perfor-mance [18 88 102] We hypothesize that

H9 There is a positive relationship between organizational creativity and orga-nizational performance

Sample and Measures

SAMPLES WERE RESTRICTED TO THE LISTED COMPANIES in order to include majorcompanies in Korea Annual Corporation Reports by Maeil Business Newspaper [75]is the source for sampling because it analyzes all listed companies in the Korea StockExchange Therefore the unit of analysis in this study is the organization We adoptedboth interviews and mail surveys Interviews were used to investigate the currentdetailed status of knowledge management This investigation included knowledgemanagement practices such as the number of communities of practice the rate of useof the knowledge management system and the cost of investment in knowledge man-agement activities Although interview data is not analyzed statistically they werevaluable for our interpretation

After the interview a questionnaire-based survey was conducted Questionnaireswere administered to a total of 1425 middle managers in 147 organizations Depend-ing on each individual firmrsquos size five to 15 middle managers were surveyed fromeach firm Middle managers were reached through their CEOs or CIOs A typical jobtitle of a middle manager was department chief Middle managers were surveyed

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 195

because they played key roles in managing knowledge Middle managers are posi-tioned at the intersection of the vertical and horizontal flows of knowledge Thusthey can synthesize the tacit knowledge of both top managers and frontline employ-ees make it explicit and incorporate it into new products and services [82]

A multiple-item method was used to construct the questionnaires Each item wasbased on a six-point Likert scale from ldquovery lowrdquo to ldquovery highrdquo Likert scales asgenerally used tend to underestimate the extreme positions [3] Respondents are re-luctant to express an extreme position even if they have it They tend to please theinterviewer appear helpful or respond in what they perceive to be a socially accept-able answer Resorting to a scale without a midpoint seems to help mollify this socialdesirability bias without changing the direction of opinion [32] The six-point Likertscale avoids a midpoint which prevents respondents from using a neutral defaultoption [5] The questionnaires were written in Korean

Research constructs were operationalized on the basis of related studies and pilottests The operational definitions of instruments and their related literature are sum-marized in Appendix A Most of the research constructs have already been validatedand used for other studies on knowledge management organizational design learn-ing or IT management For example formalization items have already been vali-dated and used by Caruana et al [14] and Rapert and Wren [89] Self-reported itemshave been used to assess organizational performance [22 25] Although these itemsdo not present a fully balanced scorecard they are effective for comparing businessunits and industries [25] Questionnaire items for the knowledge creation processwhich were used in this study had been validated and used by Nonaka et al [83]

Analysis

Sample Characteristics

IN TOTAL 451 QUESTIONNAIRES FROM 63 out of 147 firms were returned (43 percentresponse rate) The rates from individual firms ranged from 23 to 100 percent Due toincomplete data 25 responses from five firms were eliminated Consequently 426responses from 58 firms were analyzed Table 2 summarizes the respondent charac-teristics in terms of industry type departments total sales revenue and number oftotal employees

Samples are divided into three industry types manufacturing service and finan-cial business (banking finance insurance) The majority of these firms are in theservice industry Thirty-two firms have annual total sales revenue of $1 billion ormore and 31 firms have 1000 employees or more As mentioned previously sampleswere collected from various middle managers

Reliability and Validity Analysis

Table 3 presents the results of reliability and validity tests An analysis was performedon the 36 items that measured the components of knowledge enablers other analyses

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

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orga

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tiona

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erfo

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214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

1 Adler P Goldoftas B Levine D Flexibility versus efficiency A case study of modelchangeovers in the Toyota production system Organization Science 10 1 (1999) 43ndash68

2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

186 LEE AND CHOI

Tabl

e 1

(C

ontin

ued)

Org

aniz

atio

nal

Stud

yK

M e

nabl

ers

KM

pro

cess

espe

rfor

man

ceFi

ndin

gs

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

roce

sses

(co

ntin

ued)

Szu

lans

ki [1

14]

Cha

ract

eris

tics

ofTr

ansf

er (

fou

r-st

age

NA

Rec

ipie

ntrsquos

lack

of a

bsor

ptiv

eth

e kn

owle

dge

tran

sfer

pro

cess

es)

capa

city

cau

sal a

mbi

guity

and

tran

sfer

red

sour

cean

ard

uous

ness

of t

here

cipi

ent c

onte

xt

rela

tions

hip

are

the

maj

orim

pedi

men

ts to

kno

wle

dge

tran

sfer

Han

sen

[43]

Wea

k tie

s (d

ista

ntTr

ansf

er (

per

cen

tag

eN

AW

eak

ties

impe

de th

e tr

ansf

eran

d in

freq

uent

of

a p

roje

ctrsquos

to

tal

of c

ompl

ex k

now

ledg

ere

latio

nshi

ps)

kno

wle

dg

e th

atK

now

ledg

eco

me

fro

m o

ther

char

acte

rist

ics

div

isio

ns)

Rel

atio

nshi

p be

twee

n en

able

rs a

nd p

erfo

rman

ce

Bie

rly

and

KM

str

ateg

yN

AR

OS

Inno

vato

rs a

nd e

xplo

rers

are

Cha

krab

arti

[11]

RO

Am

ore

prof

itabl

e th

an e

xplo

iters

and

lone

rs

Sim

onin

[104

]C

olla

bora

tive

NA

Tan

gib

le b

enef

its

Col

labo

rativ

e kn

ow-h

ow a

llow

sex

perie

nce

(RO

I R

OA

)fir

ms

to a

chie

ve g

reat

erC

olla

bora

tive

Inta

ng

ible

ben

efit

sor

gani

zatio

nal b

enef

its

know

-how

colla

bora

tive

expe

rien

ce a

lone

does

not

ens

ure

that

a fi

rm w

illbe

nefit

from

a c

olla

bora

tion

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 187

Rel

atio

nshi

p am

ong

know

ledg

e en

able

rs p

roce

sses

and

per

form

ance

Bec

erra

-Fer

nand

ez a

ndTa

sk (

proc

ess

orC

reat

ion

(soc

ializ

atio

nK

M s

atis

fact

ion

Soc

ializ

atio

n is

sui

tabl

e fo

rS

abhe

rwal

[8]

cont

ent o

rien

tatio

nex

tern

aliz

atio

nbr

oad

and

proc

ess-

orie

nted

focu

sed

orco

mbi

natio

nta

sks

ext

erna

lizat

ion

for

broa

d do

mai

n)

inte

rnal

izat

ion)

fo

cuse

d an

d co

nten

t-or

ient

edta

sks

com

bina

tion

for

broa

dan

d co

nten

t-or

ient

ed ta

sks

and

inte

rnal

izat

ion

for

focu

ses

and

proc

ess-

orie

nted

task

sco

mbi

natio

n an

dex

tern

aliz

atio

n af

fect

know

ledg

e sa

tisfa

ctio

n

Gol

d et

al

[35]

Infr

astr

uctu

re c

apab

ility

Pro

cess

cap

abili

tyO

rgan

izat

ion

alIn

fras

truc

ture

and

pro

cess

(tec

hnol

ogy

str

uctu

re

(acq

uisi

tion

con

vers

ion

effe

ctiv

enes

sca

pabi

litie

s co

ntrib

ute

to th

ecu

lture

)ap

plic

atio

n p

rote

ctio

n)

achi

evem

ent o

f org

aniz

atio

nal

effe

ctiv

enes

s

Not

e B

oldf

ace

type

ind

icat

es d

epen

dent

var

iabl

es

188 LEE AND CHOI

our model highlights a few major factors that can explain a large proportion of thevariance in knowledge management

Variables

Enablers

A variety of knowledge management enablers have been addressed in the literature[57 70 97] Among these enablers organizational culture structure people and ITare incorporated into our research model Organizational culture is the most impor-tant factor for successful knowledge management [15 20 21 35] Culture definesnot only what knowledge is valued but also what knowledge must be kept inside theorganization for sustained innovative advantage [71] Organizations should establishan appropriate culture that encourages people to create and share knowledge withinan organization [49 70] This study focuses on collaboration trust and learning onthe basis of the concept of care [29] Care is a key enabler for organizational relation-ships [68] When organizational relationships are fostered through care knowledgecan be created and shared

The organizational structure within an organization may encourage or inhibit knowl-edge management [35 47 82] For example Ichijo et al [57] insisted that firmsshould maintain consistency between their structures to put their knowledge to useOur study includes two key structural factors such as centralization and formalization[77] They are recognized as key variables underlying the structural construct More-over their effects on knowledge management within organizations are widely recog-nized to be potent [29 59 72 91]

People are at the heart of creating organizational knowledge [15 49 80] It is peoplewho create and share knowledge Therefore managing people who are willing tocreate and share knowledge is important [85] Knowledge and competence can beacquired by admitting new people with desirable skills [108] In particular T-shapedskills embodied in employees are most often associated with core capability [56 6070] T-shaped skills may enable individual specialists to have synergistic conversa-tions with one another [74]

Technology contributes to knowledge management [35] This technology infra-structure includes IT and its capabilities [90 99] IT is widely employed to connectpeople with reusable codified knowledge and it facilitates conversations to createnew knowledge Among technology-related variables this study focuses on IT sup-port [108] ITs allow an organization to create share store and use knowledge [70]Therefore the support of IT is essential for initiating and carrying out knowledgemanagement

Enablers may be structured based upon a socio-technical theory [86] This theorydescribes an organization from the social and technical perspectives The two per-spectives are not unique to management information systems (MIS) research [12]they are made up of two jointly independent but correlative interacting componentsOrganizational culture organizational structure and people are social enablers IT is

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 189

a technical enabler For the sake of clarity we consider the impact of each knowledgeenabler independently

Processes

A number of studies have addressed knowledge management processes they divideknowledge management into several processes For example Alavi and Leidner [2]considered four processes such as creation storage transfer and application Theseprocesses are often concurrent and not always in a linear sequence [9]

Among these processes creation-related activities (for example creation [2] orconstruction [21]) become important because knowledge creation is a strategic weaponin todayrsquos global marketplace without the constant creation of knowledge a businessis condemned to obsolescence [83 87] Knowledge creation is a continuous processwhereby individuals and groups within a firm and between firms share tacit and ex-plicit knowledge [82] Although a great deal has been discussed about the importanceof knowledge creation there is relatively little empirical evidence [90] Thereforethe emphasis of this study is on knowledge creation

To explore knowledge creation our study adopts the SECI (socializationexternalization combination internalization) model by Nonaka and Takeuchi [82]for the following reasons First their work has become widely accepted [98] it hasbeen used in many research areas such as organizational learning new product devel-opment and IT [98 99] Second their model includes not only knowledge creationbut also knowledge transfer The transfer of existing knowledge and the creation ofnew knowledge are important and both of them should be considered in knowledgemanagement [69] Their SECI model is made up of four intertwined activity modessocialization (S) externalization (E) combination (C) and internalization (I) Social-ization converts tacit knowledge into new tacit knowledge through social interactionsamong members Externalization codifies tacit knowledge into explicit concepts Com-bination converts explicit knowledge into more systematic sets by combining keypieces Internalization embodies explicit knowledge into tacit knowledge

Intermediate Outcome

In order to achieve a better understanding of knowledge management performancecompanies should attempt to link knowledge processes with intermediate outcomes[18] An important intermediate outcome is organizational creativity which pro-vides a key to the understanding of organizational effectiveness and survival [122]Our model incorporates organizational creativity because it is the seed of all innova-tion [5] and at the very heart of knowledge management [40] Organizational cre-ativity transforms knowledge into business value Neglecting organizational creativitycan quickly undermine a business The relationship between knowledge creationand organizational creativity has received relatively little attention despite its highpotential [119]

190 LEE AND CHOI

Organizational Performance

Measuring organizational performance is not a trivial task because it strongly affectsthe behavior of managers and employees The ultimate test of any business is whetherit leads to measurable improvements in organizational performance

Methods for measuring organizational performance in knowledge management canbe categorized into four groups financial measures [11] intellectual capital [110]tangible and intangible benefits [104] and balanced scorecard [63] This study adoptsa specific measure which is developed and validated by Deshpande et al [22] andDrew [25] This measure can be thought of as a variation of the balanced scorecardmethod The balanced scorecard retains financial performance and supplements itwith measures on the drivers of future potential In addition it is more useful thanintellectual capital or a tangible and intangible approach because it shows cause andeffect links between knowledge components and organization strategies [63]

In summary our empirical research model illustrates the relationship among vari-ables as shown in Figure 3 In total the model consists of 13 variables

Hypotheses

Our hypotheses are largely derived from theoretical statements made in the litera-ture on knowledge management We present our hypotheses through the followingvariables

Collaboration

Collaboration may be defined as the degree to which people in a group actively helpone another in their work [55] Collaborative culture affects knowledge creation throughincreasing knowledge exchange [68 79] Exchanging knowledge among differentmembers is a prerequisite for knowledge creation Collaborative culture fosters thistype of exchange by reducing fear and increasing openness to other members Forexample Zucker et al [126] confirmed the significance of collaborative culture inknowledge creation by examining the biotechnology industry Collaboration betweenorganizational members also tightens individual differences [70] It can help peopledevelop a shared understanding about an organizationrsquos external and internal envi-ronments through supportive and reflective communication Without shared under-standing among organizational members little knowledge is ever created [30 47]We do not have a priori reason to expect a different relationship

H1 There is a positive relationship between collaboration and knowledge cre-ation process

Trust

Trust can be defined as maintaining reciprocal faith in each other in terms of intentionand behaviors [67] Trust may facilitate open substantive and influential knowledge

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 191

exchange [81 85] When their relationships are high in trust people are more willingto participate in knowledge exchange [79] Szulanski [114] empirically found thatthe lack of trust among employees is one of the key barriers against knowledge ex-change The increase in knowledge exchange brought on by mutual trust results inknowledge creation Trust also encourages a climate conducive to better knowledgecreation by alleviating the fear of risk The presence of a high level of trust can reducethis risk [81 92 100] Trust is also critical in a cross-functional or interorganizationalteam because withholding information because of a lack of trust can be especiallyharmful to knowledge creation [47 59] Therefore we would expect the followingrelationship to hold true

H2 There is a positive relationship between trust and knowledge creation process

Learning

Learning can be defined as the degree to which it is encouraged in organizations [55]The emphasis on learning infuses an organization with new knowledge [17] Learningis the acquisition of new knowledge by people who are able and willing to apply thatknowledge in making decisions or influencing others [78] Through the emphasis onlearning and development organizations can help individuals play more active rolesin knowledge creation Kanevsky and Housel [62] insisted that the amount of timespent on learning is positively related with the amount of knowledge For successfulknowledge creation organizations should develop a deeply ingrained learning culture

Figure 3 A Research Model

192 LEE AND CHOI

[88] and provide various learning means such as education training and mentoring[112 113] For example Nucor [39] which has been the most innovative steel com-pany in the United States built a knowledge creation foundation by investing in con-tinuous and multifunctional training programs Hence we hypothesize

H3 There is a positive relationship between learning and knowledge creationprocess

Centralization

Centralization refers to the locus of decision authority and control within an organi-zational entity [14 27] The concentration of decision-making authority inevitablyreduces creative solutions whereas the dispersion of power facilitates spontaneityexperimentation and the freedom of expression which are the lifeblood of knowl-edge creation [37] Moreover centralized structure hinders interdepartmental com-munication and frequent sharing of ideas [122] due to time-consuming communicationchannels [10] it also causes distortion and discontinuousness of ideas [108] Withouta constant flow of communication and ideas knowledge creation does not occur Adecentralized organizational structure has been found to facilitate an environmentwhere employees participate in knowledge building process more spontaneously [52]Participatory work environments foster knowledge creation by motivating organiza-tional membersrsquo involvements Therefore decreased centralization in the form of lo-cus of authority can lead to increased creation of knowledge [106 108 115] Weadvance the fourth hypothesis

H4 There is a negative relationship between centralization and knowledge cre-ation process

Formalization

Formalization refers to the degree to which decisions and working relationships aregoverned by formal rules standard policies and procedures [49 89] Knowledgecreation requires flexibility and less emphasis on work rules [57 73] The range ofnew ideas seems to be restricted when strict formal rules dominate an organizationFlexibility can accommodate better ways of doing things [37] Therefore the in-creased flexibility in an organizational structure can result in increased creation ofknowledge Knowledge creation also requires variation [121] In order to be moreadaptable when unforeseen problems arise an organization may accommodate varia-tion in process and structure Low formalization permits openness and variation whichencourage new ideas and behaviors [17] Knowledge creation is also likely to beencouraged through unhindered communications and interactions [10] Formalitystifles the communication and interaction necessary to create knowledge Lack offormal structure tends to enable organizational members to communicate and interactwith one another to create knowledge [59] Hence we hypothesize

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 193

H5 There is a negative relationship between formalization and knowledge cre-ation process

T-Shaped Skills

T-shaped skills are both deep (the vertical part of the ldquoTrdquo) and broad (the horizontalpart of the ldquoTrdquo) that is their possessors can explore particular knowledge domainsand their various applications in particular products [70] For example persons withT-shaped skills not only have a deep knowledge of a discipline (like ceramic materi-als engineering) but also know how their discipline interacts with other disciplines(such as polymer processing) [56] People with T-shaped skills are extremely valu-able for creating knowledge because they can integrate diverse knowledge assets [70]They have the ability both to combine theoretical and practical knowledge and to seehow their branch of knowledge interacts with other branches Therefore they canexpand their competence across several functional branch areas and thus create newknowledge [60 74]

H6 There is a positive relationship between the presence of the organizationalmembers with T-shaped skills and knowledge creation process

IT Support

IT support means the degree to which knowledge management is supported by theuse of ITs [35] Many researchers have found that IT is a crucial element for knowl-edge creation [19 36 39] IT affects knowledge in a variety of ways First IT facili-tates rapid collection storage and exchange of knowledge on a scale not practicablein the past thereby assisting the knowledge creation process [92] Second a well-developed technology integrates fragmented flows of knowledge [35] This integra-tion can eliminate barriers to communication among departments in organizationThird IT fosters all modes of knowledge creation and is not limited to the transfer ofexplicit knowledge [90 91 99] For instance InfoTESTrsquos enhanced product realiza-tion (EPR) project employs electronic whiteboarding and videoconferencing to en-hance exchanges of tacit knowledge [91] Thus we hypothesize

H7 There is a positive relationship between IT support and knowledge creationprocess

Organizational Creativity

Organizational creativity is the capability of creating valuable and useful productsservices ideas or procedures by individuals working together in a complex socialsystem [5 122] Knowledge plays an important role in the ability of the organizationto be creative [119] Thus organizations with better knowledge diffusion and creat-ing mechanisms are more intelligent [34] Organizational creativity also connectsand rearranges knowledge to create new often surprising ideas that others judge to be

194 LEE AND CHOI

useful [65] Creativity is not necessarily related to the amount of knowledge that anemployee possesses but rather the way in which knowledge is created and shared [4]The processes of knowledge creation unleash organizational creativity Naturallyorganizational creativity has a strong link with knowledge creation [119]

H8 There is a positive relationship between the knowledge creation process andorganizational creativity

Organizational Performance

In our study organizational performance is assessed by the use of global output mea-sures such as market share profitability growth rate innovativeness successfulnessand the size of business in comparison with key competitors [22 25] In a knowl-edge-based economy organizational creativity represents a dramatic organizationalchange Robinson and Stern [93] insisted that the tangible results of corporate cre-ativity are the organizational change such as improvements (changes to what is al-ready done) and innovations (entirely new activities for the company) Withoutcreativity organizations may fail to adapt to changing internal and external condi-tions [88] and thus lose their knowledge advantage Typically the goals of organiza-tional change include the various aspects of organizational performance such asorganizational effectiveness survival improvement or innovation Organizationalperformance can be thought of as the output of a process that encourages creativity[97] Thus improvements of creativity might lead to better organizational perfor-mance [18 88 102] We hypothesize that

H9 There is a positive relationship between organizational creativity and orga-nizational performance

Sample and Measures

SAMPLES WERE RESTRICTED TO THE LISTED COMPANIES in order to include majorcompanies in Korea Annual Corporation Reports by Maeil Business Newspaper [75]is the source for sampling because it analyzes all listed companies in the Korea StockExchange Therefore the unit of analysis in this study is the organization We adoptedboth interviews and mail surveys Interviews were used to investigate the currentdetailed status of knowledge management This investigation included knowledgemanagement practices such as the number of communities of practice the rate of useof the knowledge management system and the cost of investment in knowledge man-agement activities Although interview data is not analyzed statistically they werevaluable for our interpretation

After the interview a questionnaire-based survey was conducted Questionnaireswere administered to a total of 1425 middle managers in 147 organizations Depend-ing on each individual firmrsquos size five to 15 middle managers were surveyed fromeach firm Middle managers were reached through their CEOs or CIOs A typical jobtitle of a middle manager was department chief Middle managers were surveyed

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 195

because they played key roles in managing knowledge Middle managers are posi-tioned at the intersection of the vertical and horizontal flows of knowledge Thusthey can synthesize the tacit knowledge of both top managers and frontline employ-ees make it explicit and incorporate it into new products and services [82]

A multiple-item method was used to construct the questionnaires Each item wasbased on a six-point Likert scale from ldquovery lowrdquo to ldquovery highrdquo Likert scales asgenerally used tend to underestimate the extreme positions [3] Respondents are re-luctant to express an extreme position even if they have it They tend to please theinterviewer appear helpful or respond in what they perceive to be a socially accept-able answer Resorting to a scale without a midpoint seems to help mollify this socialdesirability bias without changing the direction of opinion [32] The six-point Likertscale avoids a midpoint which prevents respondents from using a neutral defaultoption [5] The questionnaires were written in Korean

Research constructs were operationalized on the basis of related studies and pilottests The operational definitions of instruments and their related literature are sum-marized in Appendix A Most of the research constructs have already been validatedand used for other studies on knowledge management organizational design learn-ing or IT management For example formalization items have already been vali-dated and used by Caruana et al [14] and Rapert and Wren [89] Self-reported itemshave been used to assess organizational performance [22 25] Although these itemsdo not present a fully balanced scorecard they are effective for comparing businessunits and industries [25] Questionnaire items for the knowledge creation processwhich were used in this study had been validated and used by Nonaka et al [83]

Analysis

Sample Characteristics

IN TOTAL 451 QUESTIONNAIRES FROM 63 out of 147 firms were returned (43 percentresponse rate) The rates from individual firms ranged from 23 to 100 percent Due toincomplete data 25 responses from five firms were eliminated Consequently 426responses from 58 firms were analyzed Table 2 summarizes the respondent charac-teristics in terms of industry type departments total sales revenue and number oftotal employees

Samples are divided into three industry types manufacturing service and finan-cial business (banking finance insurance) The majority of these firms are in theservice industry Thirty-two firms have annual total sales revenue of $1 billion ormore and 31 firms have 1000 employees or more As mentioned previously sampleswere collected from various middle managers

Reliability and Validity Analysis

Table 3 presents the results of reliability and validity tests An analysis was performedon the 36 items that measured the components of knowledge enablers other analyses

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

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5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

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65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 187

Rel

atio

nshi

p am

ong

know

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sses

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Bec

erra

-Fer

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sk (

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(soc

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atis

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Soc

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astr

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type

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es d

epen

dent

var

iabl

es

188 LEE AND CHOI

our model highlights a few major factors that can explain a large proportion of thevariance in knowledge management

Variables

Enablers

A variety of knowledge management enablers have been addressed in the literature[57 70 97] Among these enablers organizational culture structure people and ITare incorporated into our research model Organizational culture is the most impor-tant factor for successful knowledge management [15 20 21 35] Culture definesnot only what knowledge is valued but also what knowledge must be kept inside theorganization for sustained innovative advantage [71] Organizations should establishan appropriate culture that encourages people to create and share knowledge withinan organization [49 70] This study focuses on collaboration trust and learning onthe basis of the concept of care [29] Care is a key enabler for organizational relation-ships [68] When organizational relationships are fostered through care knowledgecan be created and shared

The organizational structure within an organization may encourage or inhibit knowl-edge management [35 47 82] For example Ichijo et al [57] insisted that firmsshould maintain consistency between their structures to put their knowledge to useOur study includes two key structural factors such as centralization and formalization[77] They are recognized as key variables underlying the structural construct More-over their effects on knowledge management within organizations are widely recog-nized to be potent [29 59 72 91]

People are at the heart of creating organizational knowledge [15 49 80] It is peoplewho create and share knowledge Therefore managing people who are willing tocreate and share knowledge is important [85] Knowledge and competence can beacquired by admitting new people with desirable skills [108] In particular T-shapedskills embodied in employees are most often associated with core capability [56 6070] T-shaped skills may enable individual specialists to have synergistic conversa-tions with one another [74]

Technology contributes to knowledge management [35] This technology infra-structure includes IT and its capabilities [90 99] IT is widely employed to connectpeople with reusable codified knowledge and it facilitates conversations to createnew knowledge Among technology-related variables this study focuses on IT sup-port [108] ITs allow an organization to create share store and use knowledge [70]Therefore the support of IT is essential for initiating and carrying out knowledgemanagement

Enablers may be structured based upon a socio-technical theory [86] This theorydescribes an organization from the social and technical perspectives The two per-spectives are not unique to management information systems (MIS) research [12]they are made up of two jointly independent but correlative interacting componentsOrganizational culture organizational structure and people are social enablers IT is

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 189

a technical enabler For the sake of clarity we consider the impact of each knowledgeenabler independently

Processes

A number of studies have addressed knowledge management processes they divideknowledge management into several processes For example Alavi and Leidner [2]considered four processes such as creation storage transfer and application Theseprocesses are often concurrent and not always in a linear sequence [9]

Among these processes creation-related activities (for example creation [2] orconstruction [21]) become important because knowledge creation is a strategic weaponin todayrsquos global marketplace without the constant creation of knowledge a businessis condemned to obsolescence [83 87] Knowledge creation is a continuous processwhereby individuals and groups within a firm and between firms share tacit and ex-plicit knowledge [82] Although a great deal has been discussed about the importanceof knowledge creation there is relatively little empirical evidence [90] Thereforethe emphasis of this study is on knowledge creation

To explore knowledge creation our study adopts the SECI (socializationexternalization combination internalization) model by Nonaka and Takeuchi [82]for the following reasons First their work has become widely accepted [98] it hasbeen used in many research areas such as organizational learning new product devel-opment and IT [98 99] Second their model includes not only knowledge creationbut also knowledge transfer The transfer of existing knowledge and the creation ofnew knowledge are important and both of them should be considered in knowledgemanagement [69] Their SECI model is made up of four intertwined activity modessocialization (S) externalization (E) combination (C) and internalization (I) Social-ization converts tacit knowledge into new tacit knowledge through social interactionsamong members Externalization codifies tacit knowledge into explicit concepts Com-bination converts explicit knowledge into more systematic sets by combining keypieces Internalization embodies explicit knowledge into tacit knowledge

Intermediate Outcome

In order to achieve a better understanding of knowledge management performancecompanies should attempt to link knowledge processes with intermediate outcomes[18] An important intermediate outcome is organizational creativity which pro-vides a key to the understanding of organizational effectiveness and survival [122]Our model incorporates organizational creativity because it is the seed of all innova-tion [5] and at the very heart of knowledge management [40] Organizational cre-ativity transforms knowledge into business value Neglecting organizational creativitycan quickly undermine a business The relationship between knowledge creationand organizational creativity has received relatively little attention despite its highpotential [119]

190 LEE AND CHOI

Organizational Performance

Measuring organizational performance is not a trivial task because it strongly affectsthe behavior of managers and employees The ultimate test of any business is whetherit leads to measurable improvements in organizational performance

Methods for measuring organizational performance in knowledge management canbe categorized into four groups financial measures [11] intellectual capital [110]tangible and intangible benefits [104] and balanced scorecard [63] This study adoptsa specific measure which is developed and validated by Deshpande et al [22] andDrew [25] This measure can be thought of as a variation of the balanced scorecardmethod The balanced scorecard retains financial performance and supplements itwith measures on the drivers of future potential In addition it is more useful thanintellectual capital or a tangible and intangible approach because it shows cause andeffect links between knowledge components and organization strategies [63]

In summary our empirical research model illustrates the relationship among vari-ables as shown in Figure 3 In total the model consists of 13 variables

Hypotheses

Our hypotheses are largely derived from theoretical statements made in the litera-ture on knowledge management We present our hypotheses through the followingvariables

Collaboration

Collaboration may be defined as the degree to which people in a group actively helpone another in their work [55] Collaborative culture affects knowledge creation throughincreasing knowledge exchange [68 79] Exchanging knowledge among differentmembers is a prerequisite for knowledge creation Collaborative culture fosters thistype of exchange by reducing fear and increasing openness to other members Forexample Zucker et al [126] confirmed the significance of collaborative culture inknowledge creation by examining the biotechnology industry Collaboration betweenorganizational members also tightens individual differences [70] It can help peopledevelop a shared understanding about an organizationrsquos external and internal envi-ronments through supportive and reflective communication Without shared under-standing among organizational members little knowledge is ever created [30 47]We do not have a priori reason to expect a different relationship

H1 There is a positive relationship between collaboration and knowledge cre-ation process

Trust

Trust can be defined as maintaining reciprocal faith in each other in terms of intentionand behaviors [67] Trust may facilitate open substantive and influential knowledge

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 191

exchange [81 85] When their relationships are high in trust people are more willingto participate in knowledge exchange [79] Szulanski [114] empirically found thatthe lack of trust among employees is one of the key barriers against knowledge ex-change The increase in knowledge exchange brought on by mutual trust results inknowledge creation Trust also encourages a climate conducive to better knowledgecreation by alleviating the fear of risk The presence of a high level of trust can reducethis risk [81 92 100] Trust is also critical in a cross-functional or interorganizationalteam because withholding information because of a lack of trust can be especiallyharmful to knowledge creation [47 59] Therefore we would expect the followingrelationship to hold true

H2 There is a positive relationship between trust and knowledge creation process

Learning

Learning can be defined as the degree to which it is encouraged in organizations [55]The emphasis on learning infuses an organization with new knowledge [17] Learningis the acquisition of new knowledge by people who are able and willing to apply thatknowledge in making decisions or influencing others [78] Through the emphasis onlearning and development organizations can help individuals play more active rolesin knowledge creation Kanevsky and Housel [62] insisted that the amount of timespent on learning is positively related with the amount of knowledge For successfulknowledge creation organizations should develop a deeply ingrained learning culture

Figure 3 A Research Model

192 LEE AND CHOI

[88] and provide various learning means such as education training and mentoring[112 113] For example Nucor [39] which has been the most innovative steel com-pany in the United States built a knowledge creation foundation by investing in con-tinuous and multifunctional training programs Hence we hypothesize

H3 There is a positive relationship between learning and knowledge creationprocess

Centralization

Centralization refers to the locus of decision authority and control within an organi-zational entity [14 27] The concentration of decision-making authority inevitablyreduces creative solutions whereas the dispersion of power facilitates spontaneityexperimentation and the freedom of expression which are the lifeblood of knowl-edge creation [37] Moreover centralized structure hinders interdepartmental com-munication and frequent sharing of ideas [122] due to time-consuming communicationchannels [10] it also causes distortion and discontinuousness of ideas [108] Withouta constant flow of communication and ideas knowledge creation does not occur Adecentralized organizational structure has been found to facilitate an environmentwhere employees participate in knowledge building process more spontaneously [52]Participatory work environments foster knowledge creation by motivating organiza-tional membersrsquo involvements Therefore decreased centralization in the form of lo-cus of authority can lead to increased creation of knowledge [106 108 115] Weadvance the fourth hypothesis

H4 There is a negative relationship between centralization and knowledge cre-ation process

Formalization

Formalization refers to the degree to which decisions and working relationships aregoverned by formal rules standard policies and procedures [49 89] Knowledgecreation requires flexibility and less emphasis on work rules [57 73] The range ofnew ideas seems to be restricted when strict formal rules dominate an organizationFlexibility can accommodate better ways of doing things [37] Therefore the in-creased flexibility in an organizational structure can result in increased creation ofknowledge Knowledge creation also requires variation [121] In order to be moreadaptable when unforeseen problems arise an organization may accommodate varia-tion in process and structure Low formalization permits openness and variation whichencourage new ideas and behaviors [17] Knowledge creation is also likely to beencouraged through unhindered communications and interactions [10] Formalitystifles the communication and interaction necessary to create knowledge Lack offormal structure tends to enable organizational members to communicate and interactwith one another to create knowledge [59] Hence we hypothesize

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 193

H5 There is a negative relationship between formalization and knowledge cre-ation process

T-Shaped Skills

T-shaped skills are both deep (the vertical part of the ldquoTrdquo) and broad (the horizontalpart of the ldquoTrdquo) that is their possessors can explore particular knowledge domainsand their various applications in particular products [70] For example persons withT-shaped skills not only have a deep knowledge of a discipline (like ceramic materi-als engineering) but also know how their discipline interacts with other disciplines(such as polymer processing) [56] People with T-shaped skills are extremely valu-able for creating knowledge because they can integrate diverse knowledge assets [70]They have the ability both to combine theoretical and practical knowledge and to seehow their branch of knowledge interacts with other branches Therefore they canexpand their competence across several functional branch areas and thus create newknowledge [60 74]

H6 There is a positive relationship between the presence of the organizationalmembers with T-shaped skills and knowledge creation process

IT Support

IT support means the degree to which knowledge management is supported by theuse of ITs [35] Many researchers have found that IT is a crucial element for knowl-edge creation [19 36 39] IT affects knowledge in a variety of ways First IT facili-tates rapid collection storage and exchange of knowledge on a scale not practicablein the past thereby assisting the knowledge creation process [92] Second a well-developed technology integrates fragmented flows of knowledge [35] This integra-tion can eliminate barriers to communication among departments in organizationThird IT fosters all modes of knowledge creation and is not limited to the transfer ofexplicit knowledge [90 91 99] For instance InfoTESTrsquos enhanced product realiza-tion (EPR) project employs electronic whiteboarding and videoconferencing to en-hance exchanges of tacit knowledge [91] Thus we hypothesize

H7 There is a positive relationship between IT support and knowledge creationprocess

Organizational Creativity

Organizational creativity is the capability of creating valuable and useful productsservices ideas or procedures by individuals working together in a complex socialsystem [5 122] Knowledge plays an important role in the ability of the organizationto be creative [119] Thus organizations with better knowledge diffusion and creat-ing mechanisms are more intelligent [34] Organizational creativity also connectsand rearranges knowledge to create new often surprising ideas that others judge to be

194 LEE AND CHOI

useful [65] Creativity is not necessarily related to the amount of knowledge that anemployee possesses but rather the way in which knowledge is created and shared [4]The processes of knowledge creation unleash organizational creativity Naturallyorganizational creativity has a strong link with knowledge creation [119]

H8 There is a positive relationship between the knowledge creation process andorganizational creativity

Organizational Performance

In our study organizational performance is assessed by the use of global output mea-sures such as market share profitability growth rate innovativeness successfulnessand the size of business in comparison with key competitors [22 25] In a knowl-edge-based economy organizational creativity represents a dramatic organizationalchange Robinson and Stern [93] insisted that the tangible results of corporate cre-ativity are the organizational change such as improvements (changes to what is al-ready done) and innovations (entirely new activities for the company) Withoutcreativity organizations may fail to adapt to changing internal and external condi-tions [88] and thus lose their knowledge advantage Typically the goals of organiza-tional change include the various aspects of organizational performance such asorganizational effectiveness survival improvement or innovation Organizationalperformance can be thought of as the output of a process that encourages creativity[97] Thus improvements of creativity might lead to better organizational perfor-mance [18 88 102] We hypothesize that

H9 There is a positive relationship between organizational creativity and orga-nizational performance

Sample and Measures

SAMPLES WERE RESTRICTED TO THE LISTED COMPANIES in order to include majorcompanies in Korea Annual Corporation Reports by Maeil Business Newspaper [75]is the source for sampling because it analyzes all listed companies in the Korea StockExchange Therefore the unit of analysis in this study is the organization We adoptedboth interviews and mail surveys Interviews were used to investigate the currentdetailed status of knowledge management This investigation included knowledgemanagement practices such as the number of communities of practice the rate of useof the knowledge management system and the cost of investment in knowledge man-agement activities Although interview data is not analyzed statistically they werevaluable for our interpretation

After the interview a questionnaire-based survey was conducted Questionnaireswere administered to a total of 1425 middle managers in 147 organizations Depend-ing on each individual firmrsquos size five to 15 middle managers were surveyed fromeach firm Middle managers were reached through their CEOs or CIOs A typical jobtitle of a middle manager was department chief Middle managers were surveyed

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 195

because they played key roles in managing knowledge Middle managers are posi-tioned at the intersection of the vertical and horizontal flows of knowledge Thusthey can synthesize the tacit knowledge of both top managers and frontline employ-ees make it explicit and incorporate it into new products and services [82]

A multiple-item method was used to construct the questionnaires Each item wasbased on a six-point Likert scale from ldquovery lowrdquo to ldquovery highrdquo Likert scales asgenerally used tend to underestimate the extreme positions [3] Respondents are re-luctant to express an extreme position even if they have it They tend to please theinterviewer appear helpful or respond in what they perceive to be a socially accept-able answer Resorting to a scale without a midpoint seems to help mollify this socialdesirability bias without changing the direction of opinion [32] The six-point Likertscale avoids a midpoint which prevents respondents from using a neutral defaultoption [5] The questionnaires were written in Korean

Research constructs were operationalized on the basis of related studies and pilottests The operational definitions of instruments and their related literature are sum-marized in Appendix A Most of the research constructs have already been validatedand used for other studies on knowledge management organizational design learn-ing or IT management For example formalization items have already been vali-dated and used by Caruana et al [14] and Rapert and Wren [89] Self-reported itemshave been used to assess organizational performance [22 25] Although these itemsdo not present a fully balanced scorecard they are effective for comparing businessunits and industries [25] Questionnaire items for the knowledge creation processwhich were used in this study had been validated and used by Nonaka et al [83]

Analysis

Sample Characteristics

IN TOTAL 451 QUESTIONNAIRES FROM 63 out of 147 firms were returned (43 percentresponse rate) The rates from individual firms ranged from 23 to 100 percent Due toincomplete data 25 responses from five firms were eliminated Consequently 426responses from 58 firms were analyzed Table 2 summarizes the respondent charac-teristics in terms of industry type departments total sales revenue and number oftotal employees

Samples are divided into three industry types manufacturing service and finan-cial business (banking finance insurance) The majority of these firms are in theservice industry Thirty-two firms have annual total sales revenue of $1 billion ormore and 31 firms have 1000 employees or more As mentioned previously sampleswere collected from various middle managers

Reliability and Validity Analysis

Table 3 presents the results of reliability and validity tests An analysis was performedon the 36 items that measured the components of knowledge enablers other analyses

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

188 LEE AND CHOI

our model highlights a few major factors that can explain a large proportion of thevariance in knowledge management

Variables

Enablers

A variety of knowledge management enablers have been addressed in the literature[57 70 97] Among these enablers organizational culture structure people and ITare incorporated into our research model Organizational culture is the most impor-tant factor for successful knowledge management [15 20 21 35] Culture definesnot only what knowledge is valued but also what knowledge must be kept inside theorganization for sustained innovative advantage [71] Organizations should establishan appropriate culture that encourages people to create and share knowledge withinan organization [49 70] This study focuses on collaboration trust and learning onthe basis of the concept of care [29] Care is a key enabler for organizational relation-ships [68] When organizational relationships are fostered through care knowledgecan be created and shared

The organizational structure within an organization may encourage or inhibit knowl-edge management [35 47 82] For example Ichijo et al [57] insisted that firmsshould maintain consistency between their structures to put their knowledge to useOur study includes two key structural factors such as centralization and formalization[77] They are recognized as key variables underlying the structural construct More-over their effects on knowledge management within organizations are widely recog-nized to be potent [29 59 72 91]

People are at the heart of creating organizational knowledge [15 49 80] It is peoplewho create and share knowledge Therefore managing people who are willing tocreate and share knowledge is important [85] Knowledge and competence can beacquired by admitting new people with desirable skills [108] In particular T-shapedskills embodied in employees are most often associated with core capability [56 6070] T-shaped skills may enable individual specialists to have synergistic conversa-tions with one another [74]

Technology contributes to knowledge management [35] This technology infra-structure includes IT and its capabilities [90 99] IT is widely employed to connectpeople with reusable codified knowledge and it facilitates conversations to createnew knowledge Among technology-related variables this study focuses on IT sup-port [108] ITs allow an organization to create share store and use knowledge [70]Therefore the support of IT is essential for initiating and carrying out knowledgemanagement

Enablers may be structured based upon a socio-technical theory [86] This theorydescribes an organization from the social and technical perspectives The two per-spectives are not unique to management information systems (MIS) research [12]they are made up of two jointly independent but correlative interacting componentsOrganizational culture organizational structure and people are social enablers IT is

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 189

a technical enabler For the sake of clarity we consider the impact of each knowledgeenabler independently

Processes

A number of studies have addressed knowledge management processes they divideknowledge management into several processes For example Alavi and Leidner [2]considered four processes such as creation storage transfer and application Theseprocesses are often concurrent and not always in a linear sequence [9]

Among these processes creation-related activities (for example creation [2] orconstruction [21]) become important because knowledge creation is a strategic weaponin todayrsquos global marketplace without the constant creation of knowledge a businessis condemned to obsolescence [83 87] Knowledge creation is a continuous processwhereby individuals and groups within a firm and between firms share tacit and ex-plicit knowledge [82] Although a great deal has been discussed about the importanceof knowledge creation there is relatively little empirical evidence [90] Thereforethe emphasis of this study is on knowledge creation

To explore knowledge creation our study adopts the SECI (socializationexternalization combination internalization) model by Nonaka and Takeuchi [82]for the following reasons First their work has become widely accepted [98] it hasbeen used in many research areas such as organizational learning new product devel-opment and IT [98 99] Second their model includes not only knowledge creationbut also knowledge transfer The transfer of existing knowledge and the creation ofnew knowledge are important and both of them should be considered in knowledgemanagement [69] Their SECI model is made up of four intertwined activity modessocialization (S) externalization (E) combination (C) and internalization (I) Social-ization converts tacit knowledge into new tacit knowledge through social interactionsamong members Externalization codifies tacit knowledge into explicit concepts Com-bination converts explicit knowledge into more systematic sets by combining keypieces Internalization embodies explicit knowledge into tacit knowledge

Intermediate Outcome

In order to achieve a better understanding of knowledge management performancecompanies should attempt to link knowledge processes with intermediate outcomes[18] An important intermediate outcome is organizational creativity which pro-vides a key to the understanding of organizational effectiveness and survival [122]Our model incorporates organizational creativity because it is the seed of all innova-tion [5] and at the very heart of knowledge management [40] Organizational cre-ativity transforms knowledge into business value Neglecting organizational creativitycan quickly undermine a business The relationship between knowledge creationand organizational creativity has received relatively little attention despite its highpotential [119]

190 LEE AND CHOI

Organizational Performance

Measuring organizational performance is not a trivial task because it strongly affectsthe behavior of managers and employees The ultimate test of any business is whetherit leads to measurable improvements in organizational performance

Methods for measuring organizational performance in knowledge management canbe categorized into four groups financial measures [11] intellectual capital [110]tangible and intangible benefits [104] and balanced scorecard [63] This study adoptsa specific measure which is developed and validated by Deshpande et al [22] andDrew [25] This measure can be thought of as a variation of the balanced scorecardmethod The balanced scorecard retains financial performance and supplements itwith measures on the drivers of future potential In addition it is more useful thanintellectual capital or a tangible and intangible approach because it shows cause andeffect links between knowledge components and organization strategies [63]

In summary our empirical research model illustrates the relationship among vari-ables as shown in Figure 3 In total the model consists of 13 variables

Hypotheses

Our hypotheses are largely derived from theoretical statements made in the litera-ture on knowledge management We present our hypotheses through the followingvariables

Collaboration

Collaboration may be defined as the degree to which people in a group actively helpone another in their work [55] Collaborative culture affects knowledge creation throughincreasing knowledge exchange [68 79] Exchanging knowledge among differentmembers is a prerequisite for knowledge creation Collaborative culture fosters thistype of exchange by reducing fear and increasing openness to other members Forexample Zucker et al [126] confirmed the significance of collaborative culture inknowledge creation by examining the biotechnology industry Collaboration betweenorganizational members also tightens individual differences [70] It can help peopledevelop a shared understanding about an organizationrsquos external and internal envi-ronments through supportive and reflective communication Without shared under-standing among organizational members little knowledge is ever created [30 47]We do not have a priori reason to expect a different relationship

H1 There is a positive relationship between collaboration and knowledge cre-ation process

Trust

Trust can be defined as maintaining reciprocal faith in each other in terms of intentionand behaviors [67] Trust may facilitate open substantive and influential knowledge

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 191

exchange [81 85] When their relationships are high in trust people are more willingto participate in knowledge exchange [79] Szulanski [114] empirically found thatthe lack of trust among employees is one of the key barriers against knowledge ex-change The increase in knowledge exchange brought on by mutual trust results inknowledge creation Trust also encourages a climate conducive to better knowledgecreation by alleviating the fear of risk The presence of a high level of trust can reducethis risk [81 92 100] Trust is also critical in a cross-functional or interorganizationalteam because withholding information because of a lack of trust can be especiallyharmful to knowledge creation [47 59] Therefore we would expect the followingrelationship to hold true

H2 There is a positive relationship between trust and knowledge creation process

Learning

Learning can be defined as the degree to which it is encouraged in organizations [55]The emphasis on learning infuses an organization with new knowledge [17] Learningis the acquisition of new knowledge by people who are able and willing to apply thatknowledge in making decisions or influencing others [78] Through the emphasis onlearning and development organizations can help individuals play more active rolesin knowledge creation Kanevsky and Housel [62] insisted that the amount of timespent on learning is positively related with the amount of knowledge For successfulknowledge creation organizations should develop a deeply ingrained learning culture

Figure 3 A Research Model

192 LEE AND CHOI

[88] and provide various learning means such as education training and mentoring[112 113] For example Nucor [39] which has been the most innovative steel com-pany in the United States built a knowledge creation foundation by investing in con-tinuous and multifunctional training programs Hence we hypothesize

H3 There is a positive relationship between learning and knowledge creationprocess

Centralization

Centralization refers to the locus of decision authority and control within an organi-zational entity [14 27] The concentration of decision-making authority inevitablyreduces creative solutions whereas the dispersion of power facilitates spontaneityexperimentation and the freedom of expression which are the lifeblood of knowl-edge creation [37] Moreover centralized structure hinders interdepartmental com-munication and frequent sharing of ideas [122] due to time-consuming communicationchannels [10] it also causes distortion and discontinuousness of ideas [108] Withouta constant flow of communication and ideas knowledge creation does not occur Adecentralized organizational structure has been found to facilitate an environmentwhere employees participate in knowledge building process more spontaneously [52]Participatory work environments foster knowledge creation by motivating organiza-tional membersrsquo involvements Therefore decreased centralization in the form of lo-cus of authority can lead to increased creation of knowledge [106 108 115] Weadvance the fourth hypothesis

H4 There is a negative relationship between centralization and knowledge cre-ation process

Formalization

Formalization refers to the degree to which decisions and working relationships aregoverned by formal rules standard policies and procedures [49 89] Knowledgecreation requires flexibility and less emphasis on work rules [57 73] The range ofnew ideas seems to be restricted when strict formal rules dominate an organizationFlexibility can accommodate better ways of doing things [37] Therefore the in-creased flexibility in an organizational structure can result in increased creation ofknowledge Knowledge creation also requires variation [121] In order to be moreadaptable when unforeseen problems arise an organization may accommodate varia-tion in process and structure Low formalization permits openness and variation whichencourage new ideas and behaviors [17] Knowledge creation is also likely to beencouraged through unhindered communications and interactions [10] Formalitystifles the communication and interaction necessary to create knowledge Lack offormal structure tends to enable organizational members to communicate and interactwith one another to create knowledge [59] Hence we hypothesize

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 193

H5 There is a negative relationship between formalization and knowledge cre-ation process

T-Shaped Skills

T-shaped skills are both deep (the vertical part of the ldquoTrdquo) and broad (the horizontalpart of the ldquoTrdquo) that is their possessors can explore particular knowledge domainsand their various applications in particular products [70] For example persons withT-shaped skills not only have a deep knowledge of a discipline (like ceramic materi-als engineering) but also know how their discipline interacts with other disciplines(such as polymer processing) [56] People with T-shaped skills are extremely valu-able for creating knowledge because they can integrate diverse knowledge assets [70]They have the ability both to combine theoretical and practical knowledge and to seehow their branch of knowledge interacts with other branches Therefore they canexpand their competence across several functional branch areas and thus create newknowledge [60 74]

H6 There is a positive relationship between the presence of the organizationalmembers with T-shaped skills and knowledge creation process

IT Support

IT support means the degree to which knowledge management is supported by theuse of ITs [35] Many researchers have found that IT is a crucial element for knowl-edge creation [19 36 39] IT affects knowledge in a variety of ways First IT facili-tates rapid collection storage and exchange of knowledge on a scale not practicablein the past thereby assisting the knowledge creation process [92] Second a well-developed technology integrates fragmented flows of knowledge [35] This integra-tion can eliminate barriers to communication among departments in organizationThird IT fosters all modes of knowledge creation and is not limited to the transfer ofexplicit knowledge [90 91 99] For instance InfoTESTrsquos enhanced product realiza-tion (EPR) project employs electronic whiteboarding and videoconferencing to en-hance exchanges of tacit knowledge [91] Thus we hypothesize

H7 There is a positive relationship between IT support and knowledge creationprocess

Organizational Creativity

Organizational creativity is the capability of creating valuable and useful productsservices ideas or procedures by individuals working together in a complex socialsystem [5 122] Knowledge plays an important role in the ability of the organizationto be creative [119] Thus organizations with better knowledge diffusion and creat-ing mechanisms are more intelligent [34] Organizational creativity also connectsand rearranges knowledge to create new often surprising ideas that others judge to be

194 LEE AND CHOI

useful [65] Creativity is not necessarily related to the amount of knowledge that anemployee possesses but rather the way in which knowledge is created and shared [4]The processes of knowledge creation unleash organizational creativity Naturallyorganizational creativity has a strong link with knowledge creation [119]

H8 There is a positive relationship between the knowledge creation process andorganizational creativity

Organizational Performance

In our study organizational performance is assessed by the use of global output mea-sures such as market share profitability growth rate innovativeness successfulnessand the size of business in comparison with key competitors [22 25] In a knowl-edge-based economy organizational creativity represents a dramatic organizationalchange Robinson and Stern [93] insisted that the tangible results of corporate cre-ativity are the organizational change such as improvements (changes to what is al-ready done) and innovations (entirely new activities for the company) Withoutcreativity organizations may fail to adapt to changing internal and external condi-tions [88] and thus lose their knowledge advantage Typically the goals of organiza-tional change include the various aspects of organizational performance such asorganizational effectiveness survival improvement or innovation Organizationalperformance can be thought of as the output of a process that encourages creativity[97] Thus improvements of creativity might lead to better organizational perfor-mance [18 88 102] We hypothesize that

H9 There is a positive relationship between organizational creativity and orga-nizational performance

Sample and Measures

SAMPLES WERE RESTRICTED TO THE LISTED COMPANIES in order to include majorcompanies in Korea Annual Corporation Reports by Maeil Business Newspaper [75]is the source for sampling because it analyzes all listed companies in the Korea StockExchange Therefore the unit of analysis in this study is the organization We adoptedboth interviews and mail surveys Interviews were used to investigate the currentdetailed status of knowledge management This investigation included knowledgemanagement practices such as the number of communities of practice the rate of useof the knowledge management system and the cost of investment in knowledge man-agement activities Although interview data is not analyzed statistically they werevaluable for our interpretation

After the interview a questionnaire-based survey was conducted Questionnaireswere administered to a total of 1425 middle managers in 147 organizations Depend-ing on each individual firmrsquos size five to 15 middle managers were surveyed fromeach firm Middle managers were reached through their CEOs or CIOs A typical jobtitle of a middle manager was department chief Middle managers were surveyed

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 195

because they played key roles in managing knowledge Middle managers are posi-tioned at the intersection of the vertical and horizontal flows of knowledge Thusthey can synthesize the tacit knowledge of both top managers and frontline employ-ees make it explicit and incorporate it into new products and services [82]

A multiple-item method was used to construct the questionnaires Each item wasbased on a six-point Likert scale from ldquovery lowrdquo to ldquovery highrdquo Likert scales asgenerally used tend to underestimate the extreme positions [3] Respondents are re-luctant to express an extreme position even if they have it They tend to please theinterviewer appear helpful or respond in what they perceive to be a socially accept-able answer Resorting to a scale without a midpoint seems to help mollify this socialdesirability bias without changing the direction of opinion [32] The six-point Likertscale avoids a midpoint which prevents respondents from using a neutral defaultoption [5] The questionnaires were written in Korean

Research constructs were operationalized on the basis of related studies and pilottests The operational definitions of instruments and their related literature are sum-marized in Appendix A Most of the research constructs have already been validatedand used for other studies on knowledge management organizational design learn-ing or IT management For example formalization items have already been vali-dated and used by Caruana et al [14] and Rapert and Wren [89] Self-reported itemshave been used to assess organizational performance [22 25] Although these itemsdo not present a fully balanced scorecard they are effective for comparing businessunits and industries [25] Questionnaire items for the knowledge creation processwhich were used in this study had been validated and used by Nonaka et al [83]

Analysis

Sample Characteristics

IN TOTAL 451 QUESTIONNAIRES FROM 63 out of 147 firms were returned (43 percentresponse rate) The rates from individual firms ranged from 23 to 100 percent Due toincomplete data 25 responses from five firms were eliminated Consequently 426responses from 58 firms were analyzed Table 2 summarizes the respondent charac-teristics in terms of industry type departments total sales revenue and number oftotal employees

Samples are divided into three industry types manufacturing service and finan-cial business (banking finance insurance) The majority of these firms are in theservice industry Thirty-two firms have annual total sales revenue of $1 billion ormore and 31 firms have 1000 employees or more As mentioned previously sampleswere collected from various middle managers

Reliability and Validity Analysis

Table 3 presents the results of reliability and validity tests An analysis was performedon the 36 items that measured the components of knowledge enablers other analyses

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 189

a technical enabler For the sake of clarity we consider the impact of each knowledgeenabler independently

Processes

A number of studies have addressed knowledge management processes they divideknowledge management into several processes For example Alavi and Leidner [2]considered four processes such as creation storage transfer and application Theseprocesses are often concurrent and not always in a linear sequence [9]

Among these processes creation-related activities (for example creation [2] orconstruction [21]) become important because knowledge creation is a strategic weaponin todayrsquos global marketplace without the constant creation of knowledge a businessis condemned to obsolescence [83 87] Knowledge creation is a continuous processwhereby individuals and groups within a firm and between firms share tacit and ex-plicit knowledge [82] Although a great deal has been discussed about the importanceof knowledge creation there is relatively little empirical evidence [90] Thereforethe emphasis of this study is on knowledge creation

To explore knowledge creation our study adopts the SECI (socializationexternalization combination internalization) model by Nonaka and Takeuchi [82]for the following reasons First their work has become widely accepted [98] it hasbeen used in many research areas such as organizational learning new product devel-opment and IT [98 99] Second their model includes not only knowledge creationbut also knowledge transfer The transfer of existing knowledge and the creation ofnew knowledge are important and both of them should be considered in knowledgemanagement [69] Their SECI model is made up of four intertwined activity modessocialization (S) externalization (E) combination (C) and internalization (I) Social-ization converts tacit knowledge into new tacit knowledge through social interactionsamong members Externalization codifies tacit knowledge into explicit concepts Com-bination converts explicit knowledge into more systematic sets by combining keypieces Internalization embodies explicit knowledge into tacit knowledge

Intermediate Outcome

In order to achieve a better understanding of knowledge management performancecompanies should attempt to link knowledge processes with intermediate outcomes[18] An important intermediate outcome is organizational creativity which pro-vides a key to the understanding of organizational effectiveness and survival [122]Our model incorporates organizational creativity because it is the seed of all innova-tion [5] and at the very heart of knowledge management [40] Organizational cre-ativity transforms knowledge into business value Neglecting organizational creativitycan quickly undermine a business The relationship between knowledge creationand organizational creativity has received relatively little attention despite its highpotential [119]

190 LEE AND CHOI

Organizational Performance

Measuring organizational performance is not a trivial task because it strongly affectsthe behavior of managers and employees The ultimate test of any business is whetherit leads to measurable improvements in organizational performance

Methods for measuring organizational performance in knowledge management canbe categorized into four groups financial measures [11] intellectual capital [110]tangible and intangible benefits [104] and balanced scorecard [63] This study adoptsa specific measure which is developed and validated by Deshpande et al [22] andDrew [25] This measure can be thought of as a variation of the balanced scorecardmethod The balanced scorecard retains financial performance and supplements itwith measures on the drivers of future potential In addition it is more useful thanintellectual capital or a tangible and intangible approach because it shows cause andeffect links between knowledge components and organization strategies [63]

In summary our empirical research model illustrates the relationship among vari-ables as shown in Figure 3 In total the model consists of 13 variables

Hypotheses

Our hypotheses are largely derived from theoretical statements made in the litera-ture on knowledge management We present our hypotheses through the followingvariables

Collaboration

Collaboration may be defined as the degree to which people in a group actively helpone another in their work [55] Collaborative culture affects knowledge creation throughincreasing knowledge exchange [68 79] Exchanging knowledge among differentmembers is a prerequisite for knowledge creation Collaborative culture fosters thistype of exchange by reducing fear and increasing openness to other members Forexample Zucker et al [126] confirmed the significance of collaborative culture inknowledge creation by examining the biotechnology industry Collaboration betweenorganizational members also tightens individual differences [70] It can help peopledevelop a shared understanding about an organizationrsquos external and internal envi-ronments through supportive and reflective communication Without shared under-standing among organizational members little knowledge is ever created [30 47]We do not have a priori reason to expect a different relationship

H1 There is a positive relationship between collaboration and knowledge cre-ation process

Trust

Trust can be defined as maintaining reciprocal faith in each other in terms of intentionand behaviors [67] Trust may facilitate open substantive and influential knowledge

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 191

exchange [81 85] When their relationships are high in trust people are more willingto participate in knowledge exchange [79] Szulanski [114] empirically found thatthe lack of trust among employees is one of the key barriers against knowledge ex-change The increase in knowledge exchange brought on by mutual trust results inknowledge creation Trust also encourages a climate conducive to better knowledgecreation by alleviating the fear of risk The presence of a high level of trust can reducethis risk [81 92 100] Trust is also critical in a cross-functional or interorganizationalteam because withholding information because of a lack of trust can be especiallyharmful to knowledge creation [47 59] Therefore we would expect the followingrelationship to hold true

H2 There is a positive relationship between trust and knowledge creation process

Learning

Learning can be defined as the degree to which it is encouraged in organizations [55]The emphasis on learning infuses an organization with new knowledge [17] Learningis the acquisition of new knowledge by people who are able and willing to apply thatknowledge in making decisions or influencing others [78] Through the emphasis onlearning and development organizations can help individuals play more active rolesin knowledge creation Kanevsky and Housel [62] insisted that the amount of timespent on learning is positively related with the amount of knowledge For successfulknowledge creation organizations should develop a deeply ingrained learning culture

Figure 3 A Research Model

192 LEE AND CHOI

[88] and provide various learning means such as education training and mentoring[112 113] For example Nucor [39] which has been the most innovative steel com-pany in the United States built a knowledge creation foundation by investing in con-tinuous and multifunctional training programs Hence we hypothesize

H3 There is a positive relationship between learning and knowledge creationprocess

Centralization

Centralization refers to the locus of decision authority and control within an organi-zational entity [14 27] The concentration of decision-making authority inevitablyreduces creative solutions whereas the dispersion of power facilitates spontaneityexperimentation and the freedom of expression which are the lifeblood of knowl-edge creation [37] Moreover centralized structure hinders interdepartmental com-munication and frequent sharing of ideas [122] due to time-consuming communicationchannels [10] it also causes distortion and discontinuousness of ideas [108] Withouta constant flow of communication and ideas knowledge creation does not occur Adecentralized organizational structure has been found to facilitate an environmentwhere employees participate in knowledge building process more spontaneously [52]Participatory work environments foster knowledge creation by motivating organiza-tional membersrsquo involvements Therefore decreased centralization in the form of lo-cus of authority can lead to increased creation of knowledge [106 108 115] Weadvance the fourth hypothesis

H4 There is a negative relationship between centralization and knowledge cre-ation process

Formalization

Formalization refers to the degree to which decisions and working relationships aregoverned by formal rules standard policies and procedures [49 89] Knowledgecreation requires flexibility and less emphasis on work rules [57 73] The range ofnew ideas seems to be restricted when strict formal rules dominate an organizationFlexibility can accommodate better ways of doing things [37] Therefore the in-creased flexibility in an organizational structure can result in increased creation ofknowledge Knowledge creation also requires variation [121] In order to be moreadaptable when unforeseen problems arise an organization may accommodate varia-tion in process and structure Low formalization permits openness and variation whichencourage new ideas and behaviors [17] Knowledge creation is also likely to beencouraged through unhindered communications and interactions [10] Formalitystifles the communication and interaction necessary to create knowledge Lack offormal structure tends to enable organizational members to communicate and interactwith one another to create knowledge [59] Hence we hypothesize

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 193

H5 There is a negative relationship between formalization and knowledge cre-ation process

T-Shaped Skills

T-shaped skills are both deep (the vertical part of the ldquoTrdquo) and broad (the horizontalpart of the ldquoTrdquo) that is their possessors can explore particular knowledge domainsand their various applications in particular products [70] For example persons withT-shaped skills not only have a deep knowledge of a discipline (like ceramic materi-als engineering) but also know how their discipline interacts with other disciplines(such as polymer processing) [56] People with T-shaped skills are extremely valu-able for creating knowledge because they can integrate diverse knowledge assets [70]They have the ability both to combine theoretical and practical knowledge and to seehow their branch of knowledge interacts with other branches Therefore they canexpand their competence across several functional branch areas and thus create newknowledge [60 74]

H6 There is a positive relationship between the presence of the organizationalmembers with T-shaped skills and knowledge creation process

IT Support

IT support means the degree to which knowledge management is supported by theuse of ITs [35] Many researchers have found that IT is a crucial element for knowl-edge creation [19 36 39] IT affects knowledge in a variety of ways First IT facili-tates rapid collection storage and exchange of knowledge on a scale not practicablein the past thereby assisting the knowledge creation process [92] Second a well-developed technology integrates fragmented flows of knowledge [35] This integra-tion can eliminate barriers to communication among departments in organizationThird IT fosters all modes of knowledge creation and is not limited to the transfer ofexplicit knowledge [90 91 99] For instance InfoTESTrsquos enhanced product realiza-tion (EPR) project employs electronic whiteboarding and videoconferencing to en-hance exchanges of tacit knowledge [91] Thus we hypothesize

H7 There is a positive relationship between IT support and knowledge creationprocess

Organizational Creativity

Organizational creativity is the capability of creating valuable and useful productsservices ideas or procedures by individuals working together in a complex socialsystem [5 122] Knowledge plays an important role in the ability of the organizationto be creative [119] Thus organizations with better knowledge diffusion and creat-ing mechanisms are more intelligent [34] Organizational creativity also connectsand rearranges knowledge to create new often surprising ideas that others judge to be

194 LEE AND CHOI

useful [65] Creativity is not necessarily related to the amount of knowledge that anemployee possesses but rather the way in which knowledge is created and shared [4]The processes of knowledge creation unleash organizational creativity Naturallyorganizational creativity has a strong link with knowledge creation [119]

H8 There is a positive relationship between the knowledge creation process andorganizational creativity

Organizational Performance

In our study organizational performance is assessed by the use of global output mea-sures such as market share profitability growth rate innovativeness successfulnessand the size of business in comparison with key competitors [22 25] In a knowl-edge-based economy organizational creativity represents a dramatic organizationalchange Robinson and Stern [93] insisted that the tangible results of corporate cre-ativity are the organizational change such as improvements (changes to what is al-ready done) and innovations (entirely new activities for the company) Withoutcreativity organizations may fail to adapt to changing internal and external condi-tions [88] and thus lose their knowledge advantage Typically the goals of organiza-tional change include the various aspects of organizational performance such asorganizational effectiveness survival improvement or innovation Organizationalperformance can be thought of as the output of a process that encourages creativity[97] Thus improvements of creativity might lead to better organizational perfor-mance [18 88 102] We hypothesize that

H9 There is a positive relationship between organizational creativity and orga-nizational performance

Sample and Measures

SAMPLES WERE RESTRICTED TO THE LISTED COMPANIES in order to include majorcompanies in Korea Annual Corporation Reports by Maeil Business Newspaper [75]is the source for sampling because it analyzes all listed companies in the Korea StockExchange Therefore the unit of analysis in this study is the organization We adoptedboth interviews and mail surveys Interviews were used to investigate the currentdetailed status of knowledge management This investigation included knowledgemanagement practices such as the number of communities of practice the rate of useof the knowledge management system and the cost of investment in knowledge man-agement activities Although interview data is not analyzed statistically they werevaluable for our interpretation

After the interview a questionnaire-based survey was conducted Questionnaireswere administered to a total of 1425 middle managers in 147 organizations Depend-ing on each individual firmrsquos size five to 15 middle managers were surveyed fromeach firm Middle managers were reached through their CEOs or CIOs A typical jobtitle of a middle manager was department chief Middle managers were surveyed

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 195

because they played key roles in managing knowledge Middle managers are posi-tioned at the intersection of the vertical and horizontal flows of knowledge Thusthey can synthesize the tacit knowledge of both top managers and frontline employ-ees make it explicit and incorporate it into new products and services [82]

A multiple-item method was used to construct the questionnaires Each item wasbased on a six-point Likert scale from ldquovery lowrdquo to ldquovery highrdquo Likert scales asgenerally used tend to underestimate the extreme positions [3] Respondents are re-luctant to express an extreme position even if they have it They tend to please theinterviewer appear helpful or respond in what they perceive to be a socially accept-able answer Resorting to a scale without a midpoint seems to help mollify this socialdesirability bias without changing the direction of opinion [32] The six-point Likertscale avoids a midpoint which prevents respondents from using a neutral defaultoption [5] The questionnaires were written in Korean

Research constructs were operationalized on the basis of related studies and pilottests The operational definitions of instruments and their related literature are sum-marized in Appendix A Most of the research constructs have already been validatedand used for other studies on knowledge management organizational design learn-ing or IT management For example formalization items have already been vali-dated and used by Caruana et al [14] and Rapert and Wren [89] Self-reported itemshave been used to assess organizational performance [22 25] Although these itemsdo not present a fully balanced scorecard they are effective for comparing businessunits and industries [25] Questionnaire items for the knowledge creation processwhich were used in this study had been validated and used by Nonaka et al [83]

Analysis

Sample Characteristics

IN TOTAL 451 QUESTIONNAIRES FROM 63 out of 147 firms were returned (43 percentresponse rate) The rates from individual firms ranged from 23 to 100 percent Due toincomplete data 25 responses from five firms were eliminated Consequently 426responses from 58 firms were analyzed Table 2 summarizes the respondent charac-teristics in terms of industry type departments total sales revenue and number oftotal employees

Samples are divided into three industry types manufacturing service and finan-cial business (banking finance insurance) The majority of these firms are in theservice industry Thirty-two firms have annual total sales revenue of $1 billion ormore and 31 firms have 1000 employees or more As mentioned previously sampleswere collected from various middle managers

Reliability and Validity Analysis

Table 3 presents the results of reliability and validity tests An analysis was performedon the 36 items that measured the components of knowledge enablers other analyses

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

190 LEE AND CHOI

Organizational Performance

Measuring organizational performance is not a trivial task because it strongly affectsthe behavior of managers and employees The ultimate test of any business is whetherit leads to measurable improvements in organizational performance

Methods for measuring organizational performance in knowledge management canbe categorized into four groups financial measures [11] intellectual capital [110]tangible and intangible benefits [104] and balanced scorecard [63] This study adoptsa specific measure which is developed and validated by Deshpande et al [22] andDrew [25] This measure can be thought of as a variation of the balanced scorecardmethod The balanced scorecard retains financial performance and supplements itwith measures on the drivers of future potential In addition it is more useful thanintellectual capital or a tangible and intangible approach because it shows cause andeffect links between knowledge components and organization strategies [63]

In summary our empirical research model illustrates the relationship among vari-ables as shown in Figure 3 In total the model consists of 13 variables

Hypotheses

Our hypotheses are largely derived from theoretical statements made in the litera-ture on knowledge management We present our hypotheses through the followingvariables

Collaboration

Collaboration may be defined as the degree to which people in a group actively helpone another in their work [55] Collaborative culture affects knowledge creation throughincreasing knowledge exchange [68 79] Exchanging knowledge among differentmembers is a prerequisite for knowledge creation Collaborative culture fosters thistype of exchange by reducing fear and increasing openness to other members Forexample Zucker et al [126] confirmed the significance of collaborative culture inknowledge creation by examining the biotechnology industry Collaboration betweenorganizational members also tightens individual differences [70] It can help peopledevelop a shared understanding about an organizationrsquos external and internal envi-ronments through supportive and reflective communication Without shared under-standing among organizational members little knowledge is ever created [30 47]We do not have a priori reason to expect a different relationship

H1 There is a positive relationship between collaboration and knowledge cre-ation process

Trust

Trust can be defined as maintaining reciprocal faith in each other in terms of intentionand behaviors [67] Trust may facilitate open substantive and influential knowledge

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 191

exchange [81 85] When their relationships are high in trust people are more willingto participate in knowledge exchange [79] Szulanski [114] empirically found thatthe lack of trust among employees is one of the key barriers against knowledge ex-change The increase in knowledge exchange brought on by mutual trust results inknowledge creation Trust also encourages a climate conducive to better knowledgecreation by alleviating the fear of risk The presence of a high level of trust can reducethis risk [81 92 100] Trust is also critical in a cross-functional or interorganizationalteam because withholding information because of a lack of trust can be especiallyharmful to knowledge creation [47 59] Therefore we would expect the followingrelationship to hold true

H2 There is a positive relationship between trust and knowledge creation process

Learning

Learning can be defined as the degree to which it is encouraged in organizations [55]The emphasis on learning infuses an organization with new knowledge [17] Learningis the acquisition of new knowledge by people who are able and willing to apply thatknowledge in making decisions or influencing others [78] Through the emphasis onlearning and development organizations can help individuals play more active rolesin knowledge creation Kanevsky and Housel [62] insisted that the amount of timespent on learning is positively related with the amount of knowledge For successfulknowledge creation organizations should develop a deeply ingrained learning culture

Figure 3 A Research Model

192 LEE AND CHOI

[88] and provide various learning means such as education training and mentoring[112 113] For example Nucor [39] which has been the most innovative steel com-pany in the United States built a knowledge creation foundation by investing in con-tinuous and multifunctional training programs Hence we hypothesize

H3 There is a positive relationship between learning and knowledge creationprocess

Centralization

Centralization refers to the locus of decision authority and control within an organi-zational entity [14 27] The concentration of decision-making authority inevitablyreduces creative solutions whereas the dispersion of power facilitates spontaneityexperimentation and the freedom of expression which are the lifeblood of knowl-edge creation [37] Moreover centralized structure hinders interdepartmental com-munication and frequent sharing of ideas [122] due to time-consuming communicationchannels [10] it also causes distortion and discontinuousness of ideas [108] Withouta constant flow of communication and ideas knowledge creation does not occur Adecentralized organizational structure has been found to facilitate an environmentwhere employees participate in knowledge building process more spontaneously [52]Participatory work environments foster knowledge creation by motivating organiza-tional membersrsquo involvements Therefore decreased centralization in the form of lo-cus of authority can lead to increased creation of knowledge [106 108 115] Weadvance the fourth hypothesis

H4 There is a negative relationship between centralization and knowledge cre-ation process

Formalization

Formalization refers to the degree to which decisions and working relationships aregoverned by formal rules standard policies and procedures [49 89] Knowledgecreation requires flexibility and less emphasis on work rules [57 73] The range ofnew ideas seems to be restricted when strict formal rules dominate an organizationFlexibility can accommodate better ways of doing things [37] Therefore the in-creased flexibility in an organizational structure can result in increased creation ofknowledge Knowledge creation also requires variation [121] In order to be moreadaptable when unforeseen problems arise an organization may accommodate varia-tion in process and structure Low formalization permits openness and variation whichencourage new ideas and behaviors [17] Knowledge creation is also likely to beencouraged through unhindered communications and interactions [10] Formalitystifles the communication and interaction necessary to create knowledge Lack offormal structure tends to enable organizational members to communicate and interactwith one another to create knowledge [59] Hence we hypothesize

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 193

H5 There is a negative relationship between formalization and knowledge cre-ation process

T-Shaped Skills

T-shaped skills are both deep (the vertical part of the ldquoTrdquo) and broad (the horizontalpart of the ldquoTrdquo) that is their possessors can explore particular knowledge domainsand their various applications in particular products [70] For example persons withT-shaped skills not only have a deep knowledge of a discipline (like ceramic materi-als engineering) but also know how their discipline interacts with other disciplines(such as polymer processing) [56] People with T-shaped skills are extremely valu-able for creating knowledge because they can integrate diverse knowledge assets [70]They have the ability both to combine theoretical and practical knowledge and to seehow their branch of knowledge interacts with other branches Therefore they canexpand their competence across several functional branch areas and thus create newknowledge [60 74]

H6 There is a positive relationship between the presence of the organizationalmembers with T-shaped skills and knowledge creation process

IT Support

IT support means the degree to which knowledge management is supported by theuse of ITs [35] Many researchers have found that IT is a crucial element for knowl-edge creation [19 36 39] IT affects knowledge in a variety of ways First IT facili-tates rapid collection storage and exchange of knowledge on a scale not practicablein the past thereby assisting the knowledge creation process [92] Second a well-developed technology integrates fragmented flows of knowledge [35] This integra-tion can eliminate barriers to communication among departments in organizationThird IT fosters all modes of knowledge creation and is not limited to the transfer ofexplicit knowledge [90 91 99] For instance InfoTESTrsquos enhanced product realiza-tion (EPR) project employs electronic whiteboarding and videoconferencing to en-hance exchanges of tacit knowledge [91] Thus we hypothesize

H7 There is a positive relationship between IT support and knowledge creationprocess

Organizational Creativity

Organizational creativity is the capability of creating valuable and useful productsservices ideas or procedures by individuals working together in a complex socialsystem [5 122] Knowledge plays an important role in the ability of the organizationto be creative [119] Thus organizations with better knowledge diffusion and creat-ing mechanisms are more intelligent [34] Organizational creativity also connectsand rearranges knowledge to create new often surprising ideas that others judge to be

194 LEE AND CHOI

useful [65] Creativity is not necessarily related to the amount of knowledge that anemployee possesses but rather the way in which knowledge is created and shared [4]The processes of knowledge creation unleash organizational creativity Naturallyorganizational creativity has a strong link with knowledge creation [119]

H8 There is a positive relationship between the knowledge creation process andorganizational creativity

Organizational Performance

In our study organizational performance is assessed by the use of global output mea-sures such as market share profitability growth rate innovativeness successfulnessand the size of business in comparison with key competitors [22 25] In a knowl-edge-based economy organizational creativity represents a dramatic organizationalchange Robinson and Stern [93] insisted that the tangible results of corporate cre-ativity are the organizational change such as improvements (changes to what is al-ready done) and innovations (entirely new activities for the company) Withoutcreativity organizations may fail to adapt to changing internal and external condi-tions [88] and thus lose their knowledge advantage Typically the goals of organiza-tional change include the various aspects of organizational performance such asorganizational effectiveness survival improvement or innovation Organizationalperformance can be thought of as the output of a process that encourages creativity[97] Thus improvements of creativity might lead to better organizational perfor-mance [18 88 102] We hypothesize that

H9 There is a positive relationship between organizational creativity and orga-nizational performance

Sample and Measures

SAMPLES WERE RESTRICTED TO THE LISTED COMPANIES in order to include majorcompanies in Korea Annual Corporation Reports by Maeil Business Newspaper [75]is the source for sampling because it analyzes all listed companies in the Korea StockExchange Therefore the unit of analysis in this study is the organization We adoptedboth interviews and mail surveys Interviews were used to investigate the currentdetailed status of knowledge management This investigation included knowledgemanagement practices such as the number of communities of practice the rate of useof the knowledge management system and the cost of investment in knowledge man-agement activities Although interview data is not analyzed statistically they werevaluable for our interpretation

After the interview a questionnaire-based survey was conducted Questionnaireswere administered to a total of 1425 middle managers in 147 organizations Depend-ing on each individual firmrsquos size five to 15 middle managers were surveyed fromeach firm Middle managers were reached through their CEOs or CIOs A typical jobtitle of a middle manager was department chief Middle managers were surveyed

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 195

because they played key roles in managing knowledge Middle managers are posi-tioned at the intersection of the vertical and horizontal flows of knowledge Thusthey can synthesize the tacit knowledge of both top managers and frontline employ-ees make it explicit and incorporate it into new products and services [82]

A multiple-item method was used to construct the questionnaires Each item wasbased on a six-point Likert scale from ldquovery lowrdquo to ldquovery highrdquo Likert scales asgenerally used tend to underestimate the extreme positions [3] Respondents are re-luctant to express an extreme position even if they have it They tend to please theinterviewer appear helpful or respond in what they perceive to be a socially accept-able answer Resorting to a scale without a midpoint seems to help mollify this socialdesirability bias without changing the direction of opinion [32] The six-point Likertscale avoids a midpoint which prevents respondents from using a neutral defaultoption [5] The questionnaires were written in Korean

Research constructs were operationalized on the basis of related studies and pilottests The operational definitions of instruments and their related literature are sum-marized in Appendix A Most of the research constructs have already been validatedand used for other studies on knowledge management organizational design learn-ing or IT management For example formalization items have already been vali-dated and used by Caruana et al [14] and Rapert and Wren [89] Self-reported itemshave been used to assess organizational performance [22 25] Although these itemsdo not present a fully balanced scorecard they are effective for comparing businessunits and industries [25] Questionnaire items for the knowledge creation processwhich were used in this study had been validated and used by Nonaka et al [83]

Analysis

Sample Characteristics

IN TOTAL 451 QUESTIONNAIRES FROM 63 out of 147 firms were returned (43 percentresponse rate) The rates from individual firms ranged from 23 to 100 percent Due toincomplete data 25 responses from five firms were eliminated Consequently 426responses from 58 firms were analyzed Table 2 summarizes the respondent charac-teristics in terms of industry type departments total sales revenue and number oftotal employees

Samples are divided into three industry types manufacturing service and finan-cial business (banking finance insurance) The majority of these firms are in theservice industry Thirty-two firms have annual total sales revenue of $1 billion ormore and 31 firms have 1000 employees or more As mentioned previously sampleswere collected from various middle managers

Reliability and Validity Analysis

Table 3 presents the results of reliability and validity tests An analysis was performedon the 36 items that measured the components of knowledge enablers other analyses

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 191

exchange [81 85] When their relationships are high in trust people are more willingto participate in knowledge exchange [79] Szulanski [114] empirically found thatthe lack of trust among employees is one of the key barriers against knowledge ex-change The increase in knowledge exchange brought on by mutual trust results inknowledge creation Trust also encourages a climate conducive to better knowledgecreation by alleviating the fear of risk The presence of a high level of trust can reducethis risk [81 92 100] Trust is also critical in a cross-functional or interorganizationalteam because withholding information because of a lack of trust can be especiallyharmful to knowledge creation [47 59] Therefore we would expect the followingrelationship to hold true

H2 There is a positive relationship between trust and knowledge creation process

Learning

Learning can be defined as the degree to which it is encouraged in organizations [55]The emphasis on learning infuses an organization with new knowledge [17] Learningis the acquisition of new knowledge by people who are able and willing to apply thatknowledge in making decisions or influencing others [78] Through the emphasis onlearning and development organizations can help individuals play more active rolesin knowledge creation Kanevsky and Housel [62] insisted that the amount of timespent on learning is positively related with the amount of knowledge For successfulknowledge creation organizations should develop a deeply ingrained learning culture

Figure 3 A Research Model

192 LEE AND CHOI

[88] and provide various learning means such as education training and mentoring[112 113] For example Nucor [39] which has been the most innovative steel com-pany in the United States built a knowledge creation foundation by investing in con-tinuous and multifunctional training programs Hence we hypothesize

H3 There is a positive relationship between learning and knowledge creationprocess

Centralization

Centralization refers to the locus of decision authority and control within an organi-zational entity [14 27] The concentration of decision-making authority inevitablyreduces creative solutions whereas the dispersion of power facilitates spontaneityexperimentation and the freedom of expression which are the lifeblood of knowl-edge creation [37] Moreover centralized structure hinders interdepartmental com-munication and frequent sharing of ideas [122] due to time-consuming communicationchannels [10] it also causes distortion and discontinuousness of ideas [108] Withouta constant flow of communication and ideas knowledge creation does not occur Adecentralized organizational structure has been found to facilitate an environmentwhere employees participate in knowledge building process more spontaneously [52]Participatory work environments foster knowledge creation by motivating organiza-tional membersrsquo involvements Therefore decreased centralization in the form of lo-cus of authority can lead to increased creation of knowledge [106 108 115] Weadvance the fourth hypothesis

H4 There is a negative relationship between centralization and knowledge cre-ation process

Formalization

Formalization refers to the degree to which decisions and working relationships aregoverned by formal rules standard policies and procedures [49 89] Knowledgecreation requires flexibility and less emphasis on work rules [57 73] The range ofnew ideas seems to be restricted when strict formal rules dominate an organizationFlexibility can accommodate better ways of doing things [37] Therefore the in-creased flexibility in an organizational structure can result in increased creation ofknowledge Knowledge creation also requires variation [121] In order to be moreadaptable when unforeseen problems arise an organization may accommodate varia-tion in process and structure Low formalization permits openness and variation whichencourage new ideas and behaviors [17] Knowledge creation is also likely to beencouraged through unhindered communications and interactions [10] Formalitystifles the communication and interaction necessary to create knowledge Lack offormal structure tends to enable organizational members to communicate and interactwith one another to create knowledge [59] Hence we hypothesize

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 193

H5 There is a negative relationship between formalization and knowledge cre-ation process

T-Shaped Skills

T-shaped skills are both deep (the vertical part of the ldquoTrdquo) and broad (the horizontalpart of the ldquoTrdquo) that is their possessors can explore particular knowledge domainsand their various applications in particular products [70] For example persons withT-shaped skills not only have a deep knowledge of a discipline (like ceramic materi-als engineering) but also know how their discipline interacts with other disciplines(such as polymer processing) [56] People with T-shaped skills are extremely valu-able for creating knowledge because they can integrate diverse knowledge assets [70]They have the ability both to combine theoretical and practical knowledge and to seehow their branch of knowledge interacts with other branches Therefore they canexpand their competence across several functional branch areas and thus create newknowledge [60 74]

H6 There is a positive relationship between the presence of the organizationalmembers with T-shaped skills and knowledge creation process

IT Support

IT support means the degree to which knowledge management is supported by theuse of ITs [35] Many researchers have found that IT is a crucial element for knowl-edge creation [19 36 39] IT affects knowledge in a variety of ways First IT facili-tates rapid collection storage and exchange of knowledge on a scale not practicablein the past thereby assisting the knowledge creation process [92] Second a well-developed technology integrates fragmented flows of knowledge [35] This integra-tion can eliminate barriers to communication among departments in organizationThird IT fosters all modes of knowledge creation and is not limited to the transfer ofexplicit knowledge [90 91 99] For instance InfoTESTrsquos enhanced product realiza-tion (EPR) project employs electronic whiteboarding and videoconferencing to en-hance exchanges of tacit knowledge [91] Thus we hypothesize

H7 There is a positive relationship between IT support and knowledge creationprocess

Organizational Creativity

Organizational creativity is the capability of creating valuable and useful productsservices ideas or procedures by individuals working together in a complex socialsystem [5 122] Knowledge plays an important role in the ability of the organizationto be creative [119] Thus organizations with better knowledge diffusion and creat-ing mechanisms are more intelligent [34] Organizational creativity also connectsand rearranges knowledge to create new often surprising ideas that others judge to be

194 LEE AND CHOI

useful [65] Creativity is not necessarily related to the amount of knowledge that anemployee possesses but rather the way in which knowledge is created and shared [4]The processes of knowledge creation unleash organizational creativity Naturallyorganizational creativity has a strong link with knowledge creation [119]

H8 There is a positive relationship between the knowledge creation process andorganizational creativity

Organizational Performance

In our study organizational performance is assessed by the use of global output mea-sures such as market share profitability growth rate innovativeness successfulnessand the size of business in comparison with key competitors [22 25] In a knowl-edge-based economy organizational creativity represents a dramatic organizationalchange Robinson and Stern [93] insisted that the tangible results of corporate cre-ativity are the organizational change such as improvements (changes to what is al-ready done) and innovations (entirely new activities for the company) Withoutcreativity organizations may fail to adapt to changing internal and external condi-tions [88] and thus lose their knowledge advantage Typically the goals of organiza-tional change include the various aspects of organizational performance such asorganizational effectiveness survival improvement or innovation Organizationalperformance can be thought of as the output of a process that encourages creativity[97] Thus improvements of creativity might lead to better organizational perfor-mance [18 88 102] We hypothesize that

H9 There is a positive relationship between organizational creativity and orga-nizational performance

Sample and Measures

SAMPLES WERE RESTRICTED TO THE LISTED COMPANIES in order to include majorcompanies in Korea Annual Corporation Reports by Maeil Business Newspaper [75]is the source for sampling because it analyzes all listed companies in the Korea StockExchange Therefore the unit of analysis in this study is the organization We adoptedboth interviews and mail surveys Interviews were used to investigate the currentdetailed status of knowledge management This investigation included knowledgemanagement practices such as the number of communities of practice the rate of useof the knowledge management system and the cost of investment in knowledge man-agement activities Although interview data is not analyzed statistically they werevaluable for our interpretation

After the interview a questionnaire-based survey was conducted Questionnaireswere administered to a total of 1425 middle managers in 147 organizations Depend-ing on each individual firmrsquos size five to 15 middle managers were surveyed fromeach firm Middle managers were reached through their CEOs or CIOs A typical jobtitle of a middle manager was department chief Middle managers were surveyed

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 195

because they played key roles in managing knowledge Middle managers are posi-tioned at the intersection of the vertical and horizontal flows of knowledge Thusthey can synthesize the tacit knowledge of both top managers and frontline employ-ees make it explicit and incorporate it into new products and services [82]

A multiple-item method was used to construct the questionnaires Each item wasbased on a six-point Likert scale from ldquovery lowrdquo to ldquovery highrdquo Likert scales asgenerally used tend to underestimate the extreme positions [3] Respondents are re-luctant to express an extreme position even if they have it They tend to please theinterviewer appear helpful or respond in what they perceive to be a socially accept-able answer Resorting to a scale without a midpoint seems to help mollify this socialdesirability bias without changing the direction of opinion [32] The six-point Likertscale avoids a midpoint which prevents respondents from using a neutral defaultoption [5] The questionnaires were written in Korean

Research constructs were operationalized on the basis of related studies and pilottests The operational definitions of instruments and their related literature are sum-marized in Appendix A Most of the research constructs have already been validatedand used for other studies on knowledge management organizational design learn-ing or IT management For example formalization items have already been vali-dated and used by Caruana et al [14] and Rapert and Wren [89] Self-reported itemshave been used to assess organizational performance [22 25] Although these itemsdo not present a fully balanced scorecard they are effective for comparing businessunits and industries [25] Questionnaire items for the knowledge creation processwhich were used in this study had been validated and used by Nonaka et al [83]

Analysis

Sample Characteristics

IN TOTAL 451 QUESTIONNAIRES FROM 63 out of 147 firms were returned (43 percentresponse rate) The rates from individual firms ranged from 23 to 100 percent Due toincomplete data 25 responses from five firms were eliminated Consequently 426responses from 58 firms were analyzed Table 2 summarizes the respondent charac-teristics in terms of industry type departments total sales revenue and number oftotal employees

Samples are divided into three industry types manufacturing service and finan-cial business (banking finance insurance) The majority of these firms are in theservice industry Thirty-two firms have annual total sales revenue of $1 billion ormore and 31 firms have 1000 employees or more As mentioned previously sampleswere collected from various middle managers

Reliability and Validity Analysis

Table 3 presents the results of reliability and validity tests An analysis was performedon the 36 items that measured the components of knowledge enablers other analyses

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

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59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

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61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

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68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

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73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

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KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

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82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

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egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

192 LEE AND CHOI

[88] and provide various learning means such as education training and mentoring[112 113] For example Nucor [39] which has been the most innovative steel com-pany in the United States built a knowledge creation foundation by investing in con-tinuous and multifunctional training programs Hence we hypothesize

H3 There is a positive relationship between learning and knowledge creationprocess

Centralization

Centralization refers to the locus of decision authority and control within an organi-zational entity [14 27] The concentration of decision-making authority inevitablyreduces creative solutions whereas the dispersion of power facilitates spontaneityexperimentation and the freedom of expression which are the lifeblood of knowl-edge creation [37] Moreover centralized structure hinders interdepartmental com-munication and frequent sharing of ideas [122] due to time-consuming communicationchannels [10] it also causes distortion and discontinuousness of ideas [108] Withouta constant flow of communication and ideas knowledge creation does not occur Adecentralized organizational structure has been found to facilitate an environmentwhere employees participate in knowledge building process more spontaneously [52]Participatory work environments foster knowledge creation by motivating organiza-tional membersrsquo involvements Therefore decreased centralization in the form of lo-cus of authority can lead to increased creation of knowledge [106 108 115] Weadvance the fourth hypothesis

H4 There is a negative relationship between centralization and knowledge cre-ation process

Formalization

Formalization refers to the degree to which decisions and working relationships aregoverned by formal rules standard policies and procedures [49 89] Knowledgecreation requires flexibility and less emphasis on work rules [57 73] The range ofnew ideas seems to be restricted when strict formal rules dominate an organizationFlexibility can accommodate better ways of doing things [37] Therefore the in-creased flexibility in an organizational structure can result in increased creation ofknowledge Knowledge creation also requires variation [121] In order to be moreadaptable when unforeseen problems arise an organization may accommodate varia-tion in process and structure Low formalization permits openness and variation whichencourage new ideas and behaviors [17] Knowledge creation is also likely to beencouraged through unhindered communications and interactions [10] Formalitystifles the communication and interaction necessary to create knowledge Lack offormal structure tends to enable organizational members to communicate and interactwith one another to create knowledge [59] Hence we hypothesize

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 193

H5 There is a negative relationship between formalization and knowledge cre-ation process

T-Shaped Skills

T-shaped skills are both deep (the vertical part of the ldquoTrdquo) and broad (the horizontalpart of the ldquoTrdquo) that is their possessors can explore particular knowledge domainsand their various applications in particular products [70] For example persons withT-shaped skills not only have a deep knowledge of a discipline (like ceramic materi-als engineering) but also know how their discipline interacts with other disciplines(such as polymer processing) [56] People with T-shaped skills are extremely valu-able for creating knowledge because they can integrate diverse knowledge assets [70]They have the ability both to combine theoretical and practical knowledge and to seehow their branch of knowledge interacts with other branches Therefore they canexpand their competence across several functional branch areas and thus create newknowledge [60 74]

H6 There is a positive relationship between the presence of the organizationalmembers with T-shaped skills and knowledge creation process

IT Support

IT support means the degree to which knowledge management is supported by theuse of ITs [35] Many researchers have found that IT is a crucial element for knowl-edge creation [19 36 39] IT affects knowledge in a variety of ways First IT facili-tates rapid collection storage and exchange of knowledge on a scale not practicablein the past thereby assisting the knowledge creation process [92] Second a well-developed technology integrates fragmented flows of knowledge [35] This integra-tion can eliminate barriers to communication among departments in organizationThird IT fosters all modes of knowledge creation and is not limited to the transfer ofexplicit knowledge [90 91 99] For instance InfoTESTrsquos enhanced product realiza-tion (EPR) project employs electronic whiteboarding and videoconferencing to en-hance exchanges of tacit knowledge [91] Thus we hypothesize

H7 There is a positive relationship between IT support and knowledge creationprocess

Organizational Creativity

Organizational creativity is the capability of creating valuable and useful productsservices ideas or procedures by individuals working together in a complex socialsystem [5 122] Knowledge plays an important role in the ability of the organizationto be creative [119] Thus organizations with better knowledge diffusion and creat-ing mechanisms are more intelligent [34] Organizational creativity also connectsand rearranges knowledge to create new often surprising ideas that others judge to be

194 LEE AND CHOI

useful [65] Creativity is not necessarily related to the amount of knowledge that anemployee possesses but rather the way in which knowledge is created and shared [4]The processes of knowledge creation unleash organizational creativity Naturallyorganizational creativity has a strong link with knowledge creation [119]

H8 There is a positive relationship between the knowledge creation process andorganizational creativity

Organizational Performance

In our study organizational performance is assessed by the use of global output mea-sures such as market share profitability growth rate innovativeness successfulnessand the size of business in comparison with key competitors [22 25] In a knowl-edge-based economy organizational creativity represents a dramatic organizationalchange Robinson and Stern [93] insisted that the tangible results of corporate cre-ativity are the organizational change such as improvements (changes to what is al-ready done) and innovations (entirely new activities for the company) Withoutcreativity organizations may fail to adapt to changing internal and external condi-tions [88] and thus lose their knowledge advantage Typically the goals of organiza-tional change include the various aspects of organizational performance such asorganizational effectiveness survival improvement or innovation Organizationalperformance can be thought of as the output of a process that encourages creativity[97] Thus improvements of creativity might lead to better organizational perfor-mance [18 88 102] We hypothesize that

H9 There is a positive relationship between organizational creativity and orga-nizational performance

Sample and Measures

SAMPLES WERE RESTRICTED TO THE LISTED COMPANIES in order to include majorcompanies in Korea Annual Corporation Reports by Maeil Business Newspaper [75]is the source for sampling because it analyzes all listed companies in the Korea StockExchange Therefore the unit of analysis in this study is the organization We adoptedboth interviews and mail surveys Interviews were used to investigate the currentdetailed status of knowledge management This investigation included knowledgemanagement practices such as the number of communities of practice the rate of useof the knowledge management system and the cost of investment in knowledge man-agement activities Although interview data is not analyzed statistically they werevaluable for our interpretation

After the interview a questionnaire-based survey was conducted Questionnaireswere administered to a total of 1425 middle managers in 147 organizations Depend-ing on each individual firmrsquos size five to 15 middle managers were surveyed fromeach firm Middle managers were reached through their CEOs or CIOs A typical jobtitle of a middle manager was department chief Middle managers were surveyed

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 195

because they played key roles in managing knowledge Middle managers are posi-tioned at the intersection of the vertical and horizontal flows of knowledge Thusthey can synthesize the tacit knowledge of both top managers and frontline employ-ees make it explicit and incorporate it into new products and services [82]

A multiple-item method was used to construct the questionnaires Each item wasbased on a six-point Likert scale from ldquovery lowrdquo to ldquovery highrdquo Likert scales asgenerally used tend to underestimate the extreme positions [3] Respondents are re-luctant to express an extreme position even if they have it They tend to please theinterviewer appear helpful or respond in what they perceive to be a socially accept-able answer Resorting to a scale without a midpoint seems to help mollify this socialdesirability bias without changing the direction of opinion [32] The six-point Likertscale avoids a midpoint which prevents respondents from using a neutral defaultoption [5] The questionnaires were written in Korean

Research constructs were operationalized on the basis of related studies and pilottests The operational definitions of instruments and their related literature are sum-marized in Appendix A Most of the research constructs have already been validatedand used for other studies on knowledge management organizational design learn-ing or IT management For example formalization items have already been vali-dated and used by Caruana et al [14] and Rapert and Wren [89] Self-reported itemshave been used to assess organizational performance [22 25] Although these itemsdo not present a fully balanced scorecard they are effective for comparing businessunits and industries [25] Questionnaire items for the knowledge creation processwhich were used in this study had been validated and used by Nonaka et al [83]

Analysis

Sample Characteristics

IN TOTAL 451 QUESTIONNAIRES FROM 63 out of 147 firms were returned (43 percentresponse rate) The rates from individual firms ranged from 23 to 100 percent Due toincomplete data 25 responses from five firms were eliminated Consequently 426responses from 58 firms were analyzed Table 2 summarizes the respondent charac-teristics in terms of industry type departments total sales revenue and number oftotal employees

Samples are divided into three industry types manufacturing service and finan-cial business (banking finance insurance) The majority of these firms are in theservice industry Thirty-two firms have annual total sales revenue of $1 billion ormore and 31 firms have 1000 employees or more As mentioned previously sampleswere collected from various middle managers

Reliability and Validity Analysis

Table 3 presents the results of reliability and validity tests An analysis was performedon the 36 items that measured the components of knowledge enablers other analyses

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 193

H5 There is a negative relationship between formalization and knowledge cre-ation process

T-Shaped Skills

T-shaped skills are both deep (the vertical part of the ldquoTrdquo) and broad (the horizontalpart of the ldquoTrdquo) that is their possessors can explore particular knowledge domainsand their various applications in particular products [70] For example persons withT-shaped skills not only have a deep knowledge of a discipline (like ceramic materi-als engineering) but also know how their discipline interacts with other disciplines(such as polymer processing) [56] People with T-shaped skills are extremely valu-able for creating knowledge because they can integrate diverse knowledge assets [70]They have the ability both to combine theoretical and practical knowledge and to seehow their branch of knowledge interacts with other branches Therefore they canexpand their competence across several functional branch areas and thus create newknowledge [60 74]

H6 There is a positive relationship between the presence of the organizationalmembers with T-shaped skills and knowledge creation process

IT Support

IT support means the degree to which knowledge management is supported by theuse of ITs [35] Many researchers have found that IT is a crucial element for knowl-edge creation [19 36 39] IT affects knowledge in a variety of ways First IT facili-tates rapid collection storage and exchange of knowledge on a scale not practicablein the past thereby assisting the knowledge creation process [92] Second a well-developed technology integrates fragmented flows of knowledge [35] This integra-tion can eliminate barriers to communication among departments in organizationThird IT fosters all modes of knowledge creation and is not limited to the transfer ofexplicit knowledge [90 91 99] For instance InfoTESTrsquos enhanced product realiza-tion (EPR) project employs electronic whiteboarding and videoconferencing to en-hance exchanges of tacit knowledge [91] Thus we hypothesize

H7 There is a positive relationship between IT support and knowledge creationprocess

Organizational Creativity

Organizational creativity is the capability of creating valuable and useful productsservices ideas or procedures by individuals working together in a complex socialsystem [5 122] Knowledge plays an important role in the ability of the organizationto be creative [119] Thus organizations with better knowledge diffusion and creat-ing mechanisms are more intelligent [34] Organizational creativity also connectsand rearranges knowledge to create new often surprising ideas that others judge to be

194 LEE AND CHOI

useful [65] Creativity is not necessarily related to the amount of knowledge that anemployee possesses but rather the way in which knowledge is created and shared [4]The processes of knowledge creation unleash organizational creativity Naturallyorganizational creativity has a strong link with knowledge creation [119]

H8 There is a positive relationship between the knowledge creation process andorganizational creativity

Organizational Performance

In our study organizational performance is assessed by the use of global output mea-sures such as market share profitability growth rate innovativeness successfulnessand the size of business in comparison with key competitors [22 25] In a knowl-edge-based economy organizational creativity represents a dramatic organizationalchange Robinson and Stern [93] insisted that the tangible results of corporate cre-ativity are the organizational change such as improvements (changes to what is al-ready done) and innovations (entirely new activities for the company) Withoutcreativity organizations may fail to adapt to changing internal and external condi-tions [88] and thus lose their knowledge advantage Typically the goals of organiza-tional change include the various aspects of organizational performance such asorganizational effectiveness survival improvement or innovation Organizationalperformance can be thought of as the output of a process that encourages creativity[97] Thus improvements of creativity might lead to better organizational perfor-mance [18 88 102] We hypothesize that

H9 There is a positive relationship between organizational creativity and orga-nizational performance

Sample and Measures

SAMPLES WERE RESTRICTED TO THE LISTED COMPANIES in order to include majorcompanies in Korea Annual Corporation Reports by Maeil Business Newspaper [75]is the source for sampling because it analyzes all listed companies in the Korea StockExchange Therefore the unit of analysis in this study is the organization We adoptedboth interviews and mail surveys Interviews were used to investigate the currentdetailed status of knowledge management This investigation included knowledgemanagement practices such as the number of communities of practice the rate of useof the knowledge management system and the cost of investment in knowledge man-agement activities Although interview data is not analyzed statistically they werevaluable for our interpretation

After the interview a questionnaire-based survey was conducted Questionnaireswere administered to a total of 1425 middle managers in 147 organizations Depend-ing on each individual firmrsquos size five to 15 middle managers were surveyed fromeach firm Middle managers were reached through their CEOs or CIOs A typical jobtitle of a middle manager was department chief Middle managers were surveyed

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 195

because they played key roles in managing knowledge Middle managers are posi-tioned at the intersection of the vertical and horizontal flows of knowledge Thusthey can synthesize the tacit knowledge of both top managers and frontline employ-ees make it explicit and incorporate it into new products and services [82]

A multiple-item method was used to construct the questionnaires Each item wasbased on a six-point Likert scale from ldquovery lowrdquo to ldquovery highrdquo Likert scales asgenerally used tend to underestimate the extreme positions [3] Respondents are re-luctant to express an extreme position even if they have it They tend to please theinterviewer appear helpful or respond in what they perceive to be a socially accept-able answer Resorting to a scale without a midpoint seems to help mollify this socialdesirability bias without changing the direction of opinion [32] The six-point Likertscale avoids a midpoint which prevents respondents from using a neutral defaultoption [5] The questionnaires were written in Korean

Research constructs were operationalized on the basis of related studies and pilottests The operational definitions of instruments and their related literature are sum-marized in Appendix A Most of the research constructs have already been validatedand used for other studies on knowledge management organizational design learn-ing or IT management For example formalization items have already been vali-dated and used by Caruana et al [14] and Rapert and Wren [89] Self-reported itemshave been used to assess organizational performance [22 25] Although these itemsdo not present a fully balanced scorecard they are effective for comparing businessunits and industries [25] Questionnaire items for the knowledge creation processwhich were used in this study had been validated and used by Nonaka et al [83]

Analysis

Sample Characteristics

IN TOTAL 451 QUESTIONNAIRES FROM 63 out of 147 firms were returned (43 percentresponse rate) The rates from individual firms ranged from 23 to 100 percent Due toincomplete data 25 responses from five firms were eliminated Consequently 426responses from 58 firms were analyzed Table 2 summarizes the respondent charac-teristics in terms of industry type departments total sales revenue and number oftotal employees

Samples are divided into three industry types manufacturing service and finan-cial business (banking finance insurance) The majority of these firms are in theservice industry Thirty-two firms have annual total sales revenue of $1 billion ormore and 31 firms have 1000 employees or more As mentioned previously sampleswere collected from various middle managers

Reliability and Validity Analysis

Table 3 presents the results of reliability and validity tests An analysis was performedon the 36 items that measured the components of knowledge enablers other analyses

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

194 LEE AND CHOI

useful [65] Creativity is not necessarily related to the amount of knowledge that anemployee possesses but rather the way in which knowledge is created and shared [4]The processes of knowledge creation unleash organizational creativity Naturallyorganizational creativity has a strong link with knowledge creation [119]

H8 There is a positive relationship between the knowledge creation process andorganizational creativity

Organizational Performance

In our study organizational performance is assessed by the use of global output mea-sures such as market share profitability growth rate innovativeness successfulnessand the size of business in comparison with key competitors [22 25] In a knowl-edge-based economy organizational creativity represents a dramatic organizationalchange Robinson and Stern [93] insisted that the tangible results of corporate cre-ativity are the organizational change such as improvements (changes to what is al-ready done) and innovations (entirely new activities for the company) Withoutcreativity organizations may fail to adapt to changing internal and external condi-tions [88] and thus lose their knowledge advantage Typically the goals of organiza-tional change include the various aspects of organizational performance such asorganizational effectiveness survival improvement or innovation Organizationalperformance can be thought of as the output of a process that encourages creativity[97] Thus improvements of creativity might lead to better organizational perfor-mance [18 88 102] We hypothesize that

H9 There is a positive relationship between organizational creativity and orga-nizational performance

Sample and Measures

SAMPLES WERE RESTRICTED TO THE LISTED COMPANIES in order to include majorcompanies in Korea Annual Corporation Reports by Maeil Business Newspaper [75]is the source for sampling because it analyzes all listed companies in the Korea StockExchange Therefore the unit of analysis in this study is the organization We adoptedboth interviews and mail surveys Interviews were used to investigate the currentdetailed status of knowledge management This investigation included knowledgemanagement practices such as the number of communities of practice the rate of useof the knowledge management system and the cost of investment in knowledge man-agement activities Although interview data is not analyzed statistically they werevaluable for our interpretation

After the interview a questionnaire-based survey was conducted Questionnaireswere administered to a total of 1425 middle managers in 147 organizations Depend-ing on each individual firmrsquos size five to 15 middle managers were surveyed fromeach firm Middle managers were reached through their CEOs or CIOs A typical jobtitle of a middle manager was department chief Middle managers were surveyed

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 195

because they played key roles in managing knowledge Middle managers are posi-tioned at the intersection of the vertical and horizontal flows of knowledge Thusthey can synthesize the tacit knowledge of both top managers and frontline employ-ees make it explicit and incorporate it into new products and services [82]

A multiple-item method was used to construct the questionnaires Each item wasbased on a six-point Likert scale from ldquovery lowrdquo to ldquovery highrdquo Likert scales asgenerally used tend to underestimate the extreme positions [3] Respondents are re-luctant to express an extreme position even if they have it They tend to please theinterviewer appear helpful or respond in what they perceive to be a socially accept-able answer Resorting to a scale without a midpoint seems to help mollify this socialdesirability bias without changing the direction of opinion [32] The six-point Likertscale avoids a midpoint which prevents respondents from using a neutral defaultoption [5] The questionnaires were written in Korean

Research constructs were operationalized on the basis of related studies and pilottests The operational definitions of instruments and their related literature are sum-marized in Appendix A Most of the research constructs have already been validatedand used for other studies on knowledge management organizational design learn-ing or IT management For example formalization items have already been vali-dated and used by Caruana et al [14] and Rapert and Wren [89] Self-reported itemshave been used to assess organizational performance [22 25] Although these itemsdo not present a fully balanced scorecard they are effective for comparing businessunits and industries [25] Questionnaire items for the knowledge creation processwhich were used in this study had been validated and used by Nonaka et al [83]

Analysis

Sample Characteristics

IN TOTAL 451 QUESTIONNAIRES FROM 63 out of 147 firms were returned (43 percentresponse rate) The rates from individual firms ranged from 23 to 100 percent Due toincomplete data 25 responses from five firms were eliminated Consequently 426responses from 58 firms were analyzed Table 2 summarizes the respondent charac-teristics in terms of industry type departments total sales revenue and number oftotal employees

Samples are divided into three industry types manufacturing service and finan-cial business (banking finance insurance) The majority of these firms are in theservice industry Thirty-two firms have annual total sales revenue of $1 billion ormore and 31 firms have 1000 employees or more As mentioned previously sampleswere collected from various middle managers

Reliability and Validity Analysis

Table 3 presents the results of reliability and validity tests An analysis was performedon the 36 items that measured the components of knowledge enablers other analyses

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 195

because they played key roles in managing knowledge Middle managers are posi-tioned at the intersection of the vertical and horizontal flows of knowledge Thusthey can synthesize the tacit knowledge of both top managers and frontline employ-ees make it explicit and incorporate it into new products and services [82]

A multiple-item method was used to construct the questionnaires Each item wasbased on a six-point Likert scale from ldquovery lowrdquo to ldquovery highrdquo Likert scales asgenerally used tend to underestimate the extreme positions [3] Respondents are re-luctant to express an extreme position even if they have it They tend to please theinterviewer appear helpful or respond in what they perceive to be a socially accept-able answer Resorting to a scale without a midpoint seems to help mollify this socialdesirability bias without changing the direction of opinion [32] The six-point Likertscale avoids a midpoint which prevents respondents from using a neutral defaultoption [5] The questionnaires were written in Korean

Research constructs were operationalized on the basis of related studies and pilottests The operational definitions of instruments and their related literature are sum-marized in Appendix A Most of the research constructs have already been validatedand used for other studies on knowledge management organizational design learn-ing or IT management For example formalization items have already been vali-dated and used by Caruana et al [14] and Rapert and Wren [89] Self-reported itemshave been used to assess organizational performance [22 25] Although these itemsdo not present a fully balanced scorecard they are effective for comparing businessunits and industries [25] Questionnaire items for the knowledge creation processwhich were used in this study had been validated and used by Nonaka et al [83]

Analysis

Sample Characteristics

IN TOTAL 451 QUESTIONNAIRES FROM 63 out of 147 firms were returned (43 percentresponse rate) The rates from individual firms ranged from 23 to 100 percent Due toincomplete data 25 responses from five firms were eliminated Consequently 426responses from 58 firms were analyzed Table 2 summarizes the respondent charac-teristics in terms of industry type departments total sales revenue and number oftotal employees

Samples are divided into three industry types manufacturing service and finan-cial business (banking finance insurance) The majority of these firms are in theservice industry Thirty-two firms have annual total sales revenue of $1 billion ormore and 31 firms have 1000 employees or more As mentioned previously sampleswere collected from various middle managers

Reliability and Validity Analysis

Table 3 presents the results of reliability and validity tests An analysis was performedon the 36 items that measured the components of knowledge enablers other analyses

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

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5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

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65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

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67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

196 LEE AND CHOI

Tabl

e 2

Res

pond

ent C

hara

cter

istic

s

(a)

Indu

stry

type

Indu

stry

type

(m

ain)

Indu

stry

type

(su

b)N

umbe

r of

fir

ms

Perc

ent

Man

ufac

turin

gM

achi

nery

5 8

6 E

lect

roni

cs3

52

Che

mis

try

5 8

6 P

harm

aceu

tical

3 5

2 Fo

odb

ever

age

2 3

4 O

ther

s1

17

Fin

anci

ngIn

sura

nce

5 8

6 B

anki

ng4

69

Sec

urity

5 8

6 S

ervi

ceC

onst

ruct

ion

6 10

3

Ret

ailin

g4

69

Tran

spor

tatio

n5

86

Com

mun

icat

ion

9 15

5

Oth

ers

1 1

7 To

tal

58

100

0

(b)

Dep

artm

ents

Num

ber

Dep

artm

ents

Indu

stry

of fi

rms

Plan

ning

Sale

sPr

oduc

tion

Acc

ount

ing

ISR

ampD

Etc

To

tal

Man

ufac

turin

g19

3617

2214

2035

615

0F

inan

cing

1439

28mdash

321

mdash9

100

Ser

vice

2567

28mdash

2541

96

176

Tota

l58

142

7322

4282

4421

426

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 197

(c) T

otal

sal

es r

even

ue

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

$50

mill

ion

712

1$5

0 m

illio

n to

bel

ow $

100

mill

ion

35

2$1

00 m

illio

n to

bel

ow $

500

mill

ion

1220

7$5

00 m

illio

n to

bel

ow $

1 bi

llion

46

9$1

bill

ion

to b

elow

$5

billi

on25

431

$5 b

illio

n to

bel

ow $

10 b

illio

n3

52

$10

billi

on a

nd a

bove

46

9To

tal

5810

00

(d)

Tota

l num

ber

of e

mpl

oyee

s

Ran

geN

umbe

r of

fir

ms

Perc

ent

Less

than

100

23

410

0 to

bel

ow 2

004

69

200

to b

elow

500

813

850

0 to

bel

ow 1

000

813

81

000

to b

elow

30

0010

172

300

0 to

bel

ow 1

000

09

155

100

00 to

bel

ow 3

000

07

121

300

00 a

nd a

bove

58

6To

tal

58

100

0

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

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5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

198 LEE AND CHOI

Tabl

e 3

Sta

tist

ics

for

Rel

iabi

lity

and

Val

idity

Tes

ts

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Kno

wle

dge

crea

tion

proc

ess

KC

P4

092

03S

ocia

lizat

ion

KC

S5

384

67

042

41

083

640

7479

094

2E

xter

naliz

atio

nK

CE

54

0025

0

4246

0

9146

078

370

919

Com

bina

tion

KC

C5

417

21

041

78

085

760

8481

087

7In

tern

aliz

atio

nK

CI

43

8227

0

4041

0

8902

088

730

853

Kno

wle

dge

man

agem

ent

enab

lers

Col

labo

ratio

nC

OL

53

9634

0

4035

0

8792

069

740

812

076

820

865

074

200

847

068

040

793

068

380

800

Trus

tT

RU

63

6452

0

5964

0

8932

070

020

798

072

300

815

071

660

810

074

100

828

069

870

794

070

820

804

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

EN

53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 199

Lear

ning

LE

A5

421

78

038

87

089

680

6702

078

30

7656

085

70

7063

081

30

7953

087

90

7942

087

8C

entr

aliz

atio

nC

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53

1524

0

4252

0

8481

061

760

760

069

680

818

062

360

763

068

440

810

066

380

793

For

mal

izat

ion

FO

R5

354

18

052

95

084

750

5605

070

60

7175

084

00

7592

086

80

7265

084

60

5225

066

9T-

shap

ed s

kills

TS

K5

422

85

031

07

083

090

6973

080

70

6012

075

00

7037

082

90

5911

074

30

5747

073

2IT

sup

port

ITS

54

4878

0

5552

0

8614

062

440

757

062

920

760

076

560

866

070

210

823

068

810

810

(con

tinu

es)

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

200 LEE AND CHOI

Tabl

e 3

(C

ontin

ued)

Con

verg

ent

valid

ityD

iscr

imin

ant

(cor

rela

tion

ofva

lidity

Num

ber

Rel

iabi

lity

item

with

(fac

tor

load

ing

Mea

sure

Acr

onym

of it

ems

Mea

nS

D

(Cro

nbac

h a )

tota

l sco

re-i

tem

)on

sin

gle

fact

ors)

Org

aniz

atio

nal c

reat

ivity

OC

53

8114

049

600

8709

067

440

795

070

270

818

070

440

821

076

310

861

064

280

770

Per

form

ance

Org

aniz

atio

nal

OP

54

0199

0

6751

0

8661

077

830

870

perfo

rman

ce0

5619

070

90

7502

085

30

7236

086

50

6383

077

2

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 201

were performed on the 20 items for the knowledge creation processes on the fiveitems for organizational creativity and on the six items for organizational perfor-mance Cronbachrsquos alpha is used for examining the reliability of the instruments Ahigher cutoff value of 07 may be used because these instruments have been adoptedpreviously [84] All constructs had higher than 07 cutoff alpha value ranging from08309 to 09203 For convergent validity items having item-to-total correlation scoreslower than 04 were dropped from further analysis One item relating to organiza-tional performance had an item-to-total correlation of less than 04 and thus was elimi-nated from further analysis

Factor analysis is used to check discriminant validity [64] Because each variablewas measured by multi-item constructs factor analysis with varimax was adopted tocheck the unidimensionality among items Items with factor loading values lowerthan 05 were deleted There was one item with factor loading of lower than 05 forthe knowledge creation processes A factor analysis for the knowledge enablers andknowledge creation processes is shown in Table 4 Relatively high values of reliabil-ity and validity imply that the instruments used in this study are adequate All themeasures used in this study are reported in Appendix B

Inter-Rater Reliability and Agreement Analysis

Whereas the unit of analysis in this study is the organization the questionnaire wasdistributed to organizational members to measure characteristics of their organiza-tions Therefore answers from the same organization should be aggregated and usedas an organizational indicator Given the perceptual nature of the measures and theconversion of individual responses into organizational indicators inter-rater reliabil-ity and agreement analysis are necessary [118] Inter-rater reliability is defined as anindex of consistency which represents consistency of variance among raters [66] Incontrast agreement is defined as the interchangeability among raters which addressesthe extent to which raters make the same ratings [58]

The inter-rater reliability was assessed by the use of the interclass correlation coef-ficient (ICC) Because each company was rated by a different rater and their ratingswere averaged ICC (1k) was appropriate ICC (1k) is calculated by one-way analy-sis of variance (ANOVA) [103] James et al [58] developed indices appropriate forwithin-group agreement for a set of raters rating a single target with a single item(rwg(1)) or multiple-item scale (rwg(J)) For our study rwg(J) is adopted Table 5 summa-rizes the results of inter-rater reliability and agreement A number of managementstudies suggest that ICC ranging from 0 512 to 0991 and rwg(J) ranging from 069 to096 [5 46] are appropriate Our results are consistent with these ICC and rwg(J) rangesand thus inter-rater reliability and agreement may be guaranteed

Regression Analysis

A multiple regression analysis tests our hypotheses For each hypothesis models wererun for each of the dependent variables separately as shown in Figure 4 Our model is

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

202 LEE AND CHOI

Tabl

e 4

Rot

ated

Fac

tor

Mat

rixe

s w

ith V

arim

ax R

otat

ion

(a)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

enab

lers

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4Fa

ctor

5Fa

ctor

6Fa

ctor

7

CO

L10

2595

038

340

0402

064

520

3900

024

930

0138

CO

L20

4136

031

310

1654

069

840

2503

015

570

0631

CO

L30

3914

024

880

0801

058

760

0718

001

960

4429

CO

L40

2937

026

250

2701

071

030

1653

006

200

0410

CO

L50

4018

022

000

1102

066

790

1400

006

870

2986

TR

U1

074

000

2119

017

170

0407

019

870

1194

014

78T

RU

20

6104

030

710

2406

013

540

3794

030

550

0482

TR

U3

067

950

1918

010

890

3386

006

980

0154

035

15T

RU

40

8172

021

540

1290

004

780

3018

ndash00

397

009

73T

RU

50

7670

024

240

1006

013

790

2269

013

16ndash0

137

3T

RU

60

7278

020

330

0808

022

060

1661

ndash00

694

039

41LE

A1

005

540

2525

000

100

1941

004

430

1569

074

38LE

A2

ndash00

022

016

300

1814

016

700

0204

027

740

7975

LEA

30

2379

012

030

1724

040

340

0765

011

620

6372

LEA

40

0550

025

740

1267

025

250

1811

020

330

7643

LEA

5ndash0

039

70

2345

019

290

3959

011

270

1375

075

19

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 203

CE

N1

ndash03

817

ndash00

381

ndash01

684

ndash01

719

ndash06

308

013

24ndash0

289

4C

EN

2ndash0

279

3ndash0

001

6ndash0

150

2ndash0

385

9ndash0

585

9ndash0

018

5ndash0

428

7C

EN

3ndash0

266

8ndash0

310

0ndash0

207

40

0599

ndash06

104

ndash01

072

ndash03

406

CE

N4

ndash02

997

ndash02

389

ndash02

800

ndash02

995

ndash07

084

ndash02

618

ndash00

550

CE

N5

ndash02

148

ndash01

582

ndash01

010

ndash02

640

ndash08

218

ndash01

877

008

31F

OR

1ndash0

134

8ndash0

341

7ndash0

620

70

0127

ndash02

154

ndash01

858

013

79F

OR

2ndash0

176

7ndash0

095

3ndash0

831

2ndash0

121

1ndash0

204

2ndash0

056

3ndash0

222

3F

OR

3ndash0

284

1ndash0

300

8ndash0

756

6ndash0

211

5ndash0

173

1ndash0

166

2ndash0

124

0F

OR

4ndash0

159

80

0648

ndash08

719

ndash00

565

ndash00

827

ndash01

456

ndash01

457

FO

R5

ndash00

362

ndash00

253

ndash07

755

ndash01

560

006

74ndash0

165

30

2901

TS

K1

030

81ndash0

197

80

1587

026

54ndash0

013

30

6024

016

58T

SK

20

2185

005

220

2981

011

820

2443

072

28ndash0

179

6T

SK

30

0607

002

920

3193

007

580

0974

079

400

0676

TS

K4

017

410

2533

ndash00

515

ndash01

318

021

950

6079

037

09T

SK

5ndash0

025

80

0574

ndash01

198

018

53ndash0

069

90

7694

040

34IT

S1

020

250

8320

004

270

2608

014

48ndash0

000

5ndash0

053

7IT

S2

041

940

6828

020

100

2577

ndash00

871

ndash00

334

009

28IT

S3

023

280

8263

009

250

2059

017

080

1612

008

41IT

S4

035

850

7789

016

190

0434

010

910

0203

019

86IT

S5

033

000

8032

004

930

1835

020

99ndash0

041

00

0169

(con

tinu

es)

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

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ance

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ity in

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er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

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ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

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aniz

atio

nal c

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ivity

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e b

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214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

1 Adler P Goldoftas B Levine D Flexibility versus efficiency A case study of modelchangeovers in the Toyota production system Organization Science 10 1 (1999) 43ndash68

2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

204 LEE AND CHOI

Tabl

e 4

(C

ontin

ued)

(b)

Fact

or m

atri

x fo

r en

tire

item

s of

kno

wle

dge

crea

tion

proc

ess

Var

iabl

esFa

ctor

1Fa

ctor

2Fa

ctor

3Fa

ctor

4

KC

S1

008

650

5335

001

500

1482

KC

S2

024

060

8193

ndash00

151

036

68K

CS

30

3345

060

290

2587

041

51K

CS

40

3213

062

650

4340

027

42K

CS

50

4823

056

950

5394

037

81K

CE

10

8070

022

720

1754

005

12K

CE

20

8022

036

670

1667

022

97K

CE

30

5686

036

880

3585

020

56K

CE

40

7238

039

980

1822

009

58K

CE

50

7551

044

390

2218

032

00K

CC

10

3591

037

530

5686

030

56K

CC

20

2402

016

150

6951

038

48K

CC

30

0583

024

170

8523

004

62K

CC

40

2146

015

660

8532

016

29K

CC

50

5430

042

630

6105

037

60K

CI1

018

030

1471

010

820

8855

KC

I20

3560

011

440

1117

082

00K

CI3

034

480

3970

031

450

6772

KC

I40

3483

042

780

3420

064

74

Not

e I

tem

loa

ding

s on

the

ir t

heor

etic

ally

ass

ocia

ted

fact

ors

are

high

ligh

ted

in b

oldf

ace

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 205

Table 5 Results of Inter-Rater Reliability and Agreement

Variables Indices ICC (1k) rwg(J)

Knowledge Socialization 06627 08138creation Externalization 06468 08815process Combination 05252 08522

Internalization 05285 08633

Knowledge Collaboration 06081 08691management Trust 08037 08929enablers Learning 06863 08927

Centralization 05632 08426Formalization 06983 08393T-shaped skills 05236 08203IT support 07515 08460

Organizational creativity 07390 08552

Organizational performance 08397 08601

not meaningful if the correlation between enablers and the knowledge creation pro-cess is not significant Therefore the knowledge creation process is considered as anaggregated variable and its correlation is computed We then test each hypothesis tofind which enablers are more important for knowledge creation and which processesare more important for organizational performance

To meet the assumptions of regression analysis we examined the linearity constantvariance and normality [42] Because the scatterplots of individual variables do notindicate any nonlinear relationships the linearity is guaranteed Plotting the studentizedresiduals against the predicted value shows that no variable violates the constant vari-ance The result from the normal probability plot and Kolmogorov-Smirnov testsindicates no violation of normality (statistic = 0050 ~ 0096 p gt 0200)

The overall regression model (for finding the relationship between the knowledgecreation process and enablers) is significant (F = 51771 p lt 0000) R2 (0879) sug-gests that 879 percent of the variance is explained by seven variables The result ofthe collinearity test (VIF = 1429 ~ 3725) shows no multicollinearity problem

Analysis Results

TABLE 6 SUMMARIZES OUR REGRESSION RESULTS In order to provide a better presen-tation of significant relationships Figure 5 has been provided Collaboration trustlearning and centralization are found to be relatively significant predictors for knowl-edge creation

Organizational culture variables are found to be essential for knowledge creationCollaboration is positively related with socialization externalization and internaliza-tion whereas it does not affect the combination mode In particular trust is a signifi-cant predictor of all knowledge creation modes Centralization is negatively relatedwith socialization externalization and internalization while it is not significantly re-lated with combination By contrast formalization and T-shaped skills of members

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

1 Adler P Goldoftas B Levine D Flexibility versus efficiency A case study of modelchangeovers in the Toyota production system Organization Science 10 1 (1999) 43ndash68

2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

206 LEE AND CHOI

do not significantly affect knowledge creation IT support is significantly related withknowledge combination only

Knowledge creation is positively related with organizational creativity which ispositively related with organizational performance This finding confirms that an or-ganization can achieve strategic benefits of knowledge management through effec-tive knowledge creation

Discussion

Limitations

THE FINDINGS OF THIS STUDY ARE INTERESTING but they should be considered inlight of its inherent limitations First this study presents a snapshot research that does

(a) Between the knowledge creation processes and knowledge management enablers

KCP = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCS = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCE = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCC = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + eKCI = a + b1 COL + b2 TRU + b3 LEA + b4 CEN + b5 FOR + b6 TSK + b7 ITS + e

(b) Between organizational creativity and knowledge creation processes

OC = a + b1 KCP+ eOC = a + b1 KCS + b2 KCE + b3 KCC + b4 KCI + e

(c) Between organizational performance and organizational creativity

OP = a + b1 OC + e

Figure 4 Regression Equations

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 207

Tabl

e 6

Sum

mar

y of

Reg

ress

ion

Res

ults

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

Col

labo

ratio

n (H

1)bbbb b

= 0

208

5bbbb b

= 0

301

7b b b b b

= 0

247

7b

= ndash0

069

4bbbb b

= 0

269

2N

At

= 2

490

1

t =

31

036

t

= 1

994

1t =

ndash0

4938

t =

20

947

Trus

t (H

2)bbbb b

= 0

352

5bbbb b

= 0

237

9bbbb b

= 0

307

9b b b b b

= 0

404

1b

= 0

318

2N

At

= 3

590

7

t =

20

873

t

= 2

114

0

t =

24

515

t

= 2

111

8

Lear

ning

(H

3)bbbb b

= 0

213

8bbbb b

= 0

309

6b

= 0

129

6b

= 0

161

2b b b b b

= 0

189

5N

At

= 2

249

8

t =

28

054

t =

09

191

t = 1

010

2t

= 1

998

5

Cen

tral

izat

ion

(H4)

b b b b b =

ndash0

2030

b b b b b =

ndash0

1755

b b b b b =

ndash0

2144

b =

ndash0

1353

b b b b b =

ndash0

2025

NA

t =

ndash2

6745

t

= ndash

201

42

t =

ndash1

9039

t =

ndash1

0618

t =

ndash1

7381

For

mal

izat

ion

(H5)

b =

ndash0

013

b =

ndash0

0520

b =

ndash0

1165

b =

00

018

b =

01

152

NA

t = ndash

021

62t =

ndash0

5262

t = ndash

128

91t =

00

267

t = 1

319

4

T-sh

aped

ski

lls (

H6)

b =

00

443

b =

00

286

b =

00

560

b =

00

205

b =

00

545

NA

t = 0

741

1t =

04

139

t = 0

633

9t =

02

053

t = 0

595

8(c

onti

nues

)

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

208 LEE AND CHOI

Tabl

e 6

(C

ontin

ued)

Kno

wle

dge

crea

tion

proc

ess

Soci

aliz

atio

nE

xter

naliz

atio

nC

ombi

natio

nIn

tern

aliz

atio

nR

2 = 0

879

R2 =

08

37R

2 = 0

733

R2 =

06

58R

2 = 0

714

F =

51

771

F

= 3

655

3

F =

19

619

F

= 1

374

9

F

= 1

785

7

Org

aniz

atio

nal

Var

iabl

es(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)(N

= 5

8)cr

eativ

ity

IT s

uppo

rt (

H7)

b =

00

611

b =

ndash0

0111

b =

01

124

b b b b b =

02

516

b =

ndash0

2025

NA

t = 0

891

1t =

ndash0

1388

t = 1

202

9t

= 2

184

8

t = ndash

173

81

Org

aniz

atio

nal

crea

tivity

(H

8)R

2 =

08

19b b b b b

= 0

903

5b b b b b

= 0

295

7b b b b b

= 0

290

6b b b b b

= 0

177

8b b b b b

= 0

237

1N

AF

= 5

991

4

t =

15

7786

t =

20

883

t

= 2

228

1

t =

18

835

t =

26

010

(N

= 5

8)

Org

aniz

atio

nal

perfo

rman

ce (

H9)

R2 =

04

02N

AN

AN

AN

AN

Ab b b b b

= 0

633

8F

= 3

759

2

t =

61

313

(N

= 5

8)

Not

es

Sup

port

ed h

ypot

hese

s in

bol

dfac

e ty

pe

p

lt 0

01

p lt

00

5

p lt

01

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 209

Fig

ure

5 S

igni

fica

nt R

elat

ions

hips

in R

egre

ssio

n R

esul

ts

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

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5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

210 LEE AND CHOI

not consider feedback effects A longitudinal study to investigate the dynamic fea-tures of knowledge management would provide further robust results Second it fo-cuses on relatively large and profitable firms The results may differ in small or venturefirms Finally the results are limited to Korean firms The generalizability from aKorean setting to other countries may be questionable

Implications

Our results can help managers establish distinctive strategic positions Knowledgemanagement strategies can be described along two dimensions to reflect knowledgemanagement focus [45] One dimension refers to knowledge sharing via interper-sonal interaction The other dimension refers to the capability to help create storeshare and use an organizationrsquos explicitly documented knowledge The former ismore affected by socialization and the latter is more affected by combination [16]Knowledge management strategists can sharpen weak knowledge management di-mensions on the basis of enablers mentioned in our study Table 7 highlights theseimplications The following is a further discussion of these implications

Our findings confirm that knowledge creation is associated with cultural factorssuch as collaboration trust and learning For instance groups are most creative whentheir members collaborate members stop holding back when they have mutual trust[54] Shaping cultural factors is crucial for a firmrsquos ability to manage its knowledgeeffectively [15 20 35 71] For example our interview with an executive of a confec-tionery company highlights this point The executive pointed out that their employeesdid not just use the manual or other codified supports It was noted that they preferredto depend on their own experiences and networking relationships A trust-based cul-ture is the foundation for their knowledge management initiative

However many knowledge management projects in reality focus on IT [19 35111] An organization may face difficulties in building its knowledge creating envi-ronment due to the lack of adequate culture despite its well-constructed IT [23 72]Stein and Zwass [107] insisted that successful information systems should be condi-tioned by a number of cultural factors such as organizational values and appropriatelearning methods Initiating knowledge management only through IT can be a riskyproposition [19]

Our analysis confirms that IT support affects combination There are several re-sources for a sound understanding of the impact of IT on knowledge combination[82 100] This finding highlights the characteristics of knowledge combination IT iscritical for codifying explicit knowledge it provides fast feedback for explicit knowl-edge [69 120] In order to support knowledge combination the question is not whetherto deploy IT but how to deploy it Interestingly our analysis also reveals that trustaffects combination This result implies that simply improving the IT infrastructuredoes not provide a competitive advantage for knowledge combination Through in-terviews with executives in the disk industry in the United States Scott [100] foundthat communication of even explicit knowledge is difficult without a solid founda-

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 211

Tabl

e 7

Sum

mar

y of

Im

plic

atio

ns

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es

Sig

nific

ant

Cul

tura

l fac

tors

Cul

tura

l fac

tors

are

pos

itive

ly a

ssoc

iate

dS

hapi

ng c

ultu

ral f

acto

rs is

cru

cial

for

know

ledg

ew

ith k

now

ledg

e cr

eatio

nm

anag

emen

tIn

itiat

ing

know

ledg

e m

anag

emen

t onl

y th

roug

hin

form

atio

n te

chno

logy

can

be

a ri

sky

prop

ositi

on

Man

ager

s ne

ed to

est

ablis

h kn

owle

dge

man

agem

ent c

onsi

deri

ng fi

rmrsquos

cul

ture

C

ombi

natio

nC

ombi

natio

n is

affe

cted

by

ITIn

form

atio

n te

chno

logy

is c

ritic

al fo

r co

dify

ing

and

trus

tex

plic

it kn

owle

dge

Sim

ply

impr

ovin

g th

e in

form

atio

n te

chno

logy

infr

astr

uctu

re d

oes

not p

rovi

de a

com

petit

ive

adva

ntag

e fo

r kn

owle

dge

com

bina

tion

Man

ager

s sh

ould

pay

car

eful

atte

ntio

n to

the

pote

ntia

l im

pact

of i

nfor

mat

ion

tech

nolo

gy o

nkn

owle

dge

com

bina

tion

with

the

cons

ider

atio

n of

trus

t in

a fir

m

(con

tinu

es)

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

212 LEE AND CHOI

Tabl

e 7

(C

ontin

ued)

Focu

sFi

ndin

gsIm

plic

atio

ns

Rel

atio

nshi

ps b

etw

een

enab

lers

and

pro

cess

es (

cont

inue

d)

Non

sign

ifica

ntF

orm

aliz

atio

nN

o re

latio

nshi

p be

twee

n fo

rmal

izat

ion

Two

diffe

rent

asp

ects

of f

orm

aliz

atio

nan

d kn

owle

dge

crea

tion

(for

mal

izat

ion

may

inhi

bit t

acit-

rela

ted

For

mal

izat

ion

may

tend

to in

hibi

tac

tiviti

es b

ut m

ay e

ncou

rage

exp

licit-

rela

ted

soci

aliz

atio

n an

d ex

tern

aliz

atio

nac

tiviti

es)

whe

reas

it fa

cilit

ates

com

bina

tion

Fur

ther

exp

lora

tion

of r

elat

ions

hip

betw

een

and

inte

rnal

izat

ion

form

aliz

atio

n an

d kn

owle

dge

crea

tion

isne

eded

(if

the

emph

asis

of e

xter

naliz

atio

n is

on ta

cit k

now

ledg

e e

xter

naliz

atio

n m

ay b

ene

gativ

ely

asso

ciat

ed w

ith fo

rmal

izat

ion

ifth

e co

nver

sion

pro

cess

or

its te

chno

logy

pers

pect

ive

of e

xter

naliz

atio

n is

em

phas

ized

fo

rmal

izat

ion

can

affe

ct e

xter

naliz

atio

npo

sitiv

ely)

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

ifica

ntT-

shap

ed s

kills

No

rela

tions

hip

betw

een

T-sh

aped

ski

llsW

ithou

t an

envi

ronm

ent i

n w

hich

T-s

hape

dan

d kn

owle

dge

crea

tion

skill

s flo

uris

h p

eopl

e w

ith T

-sha

ped

skill

s w

illno

t atte

mpt

to c

reat

e ne

w k

now

ledg

eA

cru

cial

ele

men

t of s

ucce

ssfu

l kno

wle

dge

man

agem

ent i

s no

t T-s

hape

d sk

ills

them

selv

es b

ut th

e sy

stem

atic

man

agem

ent

of th

ese

skill

s (T

-sha

ped

man

agem

ent

syst

ems)

IT

sup

port

IT s

uppo

rt is

not

sig

nific

antly

rel

ated

The

cur

rent

sta

te o

f inf

orm

atio

n te

chno

logy

may

with

kno

wle

dge

crea

tion

exce

ptno

t affe

ct s

ocia

lizat

ion

ext

erna

lizat

ion

or

com

bina

tion

inte

rnal

izat

ion

dire

ctly

Rel

atio

nshi

ps b

etw

een

inte

rmed

iate

out

com

e an

d pe

rfor

man

ce

Org

aniz

atio

nal

Org

aniz

atio

nal c

reat

ivity

affe

cts

Man

ager

s pa

y m

ore

atte

ntio

n to

org

aniz

atio

nal

crea

tivity

orga

niza

tiona

l per

form

ance

cr

eativ

ity in

ord

er to

impr

ove

orga

niza

tiona

lT

he p

erce

ntag

e of

tota

l var

iatio

n of

perf

orm

ance

or

gani

zatio

nal p

erfo

rman

ce e

xpla

ined

The

cre

ativ

ity p

arad

ox (

orga

niza

tiona

l cre

ativ

ityby

org

aniz

atio

nal c

reat

ivity

isis

val

uabl

e b

ut it

s ov

er-e

ncou

rage

men

t may

rela

tivel

y lo

w

not b

e al

way

s us

eful

)

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

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6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

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8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 213

Non

sign

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214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

1 Adler P Goldoftas B Levine D Flexibility versus efficiency A case study of modelchangeovers in the Toyota production system Organization Science 10 1 (1999) 43ndash68

2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

214 LEE AND CHOI

tion of trust Managers should pay careful attention to the potential impact of IT onknowledge combination with the consideration of trust in a firm

The nonsignificant findings in this study also bear some implication Several stud-ies have come to the conclusion that formalization weakens knowledge management[57 106] In contrast our study shows no relationship between formalization andknowledge creation This rather intriguing result reflects the two different aspects offormalization According to the ambidextrous model which is based on the distinc-tion between the initiation and implementation stages of innovation [26 94] formal-ization may inhibit tacit-related activities such as socialization (b = ndash0052) andexternalization (b = ndash01165) but may encourage explicit-related activities such ascombination (b = 00018) and internalization (b = 01152) However this interpreta-tion needs further exploration because all b values are not statistically significant

In particular a more careful investigation of externalization is of interest Externali-zation involves the expression of tacit knowledge [8] From this perspective a formalorganizational structure may inhibit spontaneity and freedom of expression neces-sary for externalization [10] In our study the emphasis of externalization is on tacitknowledge and thus externalization is negatively associated with formalization How-ever externalization may also involve conversion of tacit into explicit knowledge [8]The formal structure can facilitate the rapid and continuous conversion of tacit intoexplicit knowledge [37] If the conversion process or its technology perspective ofexternalization is emphasized like Becerra-Fernandez and Sabherwal [8] we mayspeculate that formalization can affect externalization positively

Many studies suggested that T-shaped skills positively influence knowledge cre-ation [60 70 74] However our study shows no relationship between T-shaped skillsand knowledge creation This contradiction may reflect the importance of T-shapedmanagement systems T-shaped management systems attempt to break out of the tra-ditional corporate hierarchy and encourage people to share knowledge [44] How-ever most current formal organizational incentives encourage I-shaped skills (thedeep functional expertise) in isolation [70] Without an environment in which T-shapedskills flourish people with T-shaped skills will not attempt to create new knowledgeIt implies that a crucial element of successful knowledge management is not T-shapedskills themselves but the systematic management of these skills

It would be expected that technologies could facilitate knowledge creation How-ever our result shows that IT support is not significantly related with knowledge cre-ation except for combination It seems that IT does not support all modes of knowledgecreation directly Although groupware intranet or videoconferencing can help col-laborative works this technologically facilitated communication cannot replace face-to-face contact for tacit-to-tacit knowledge transfer [53] Accessing the tacit knowledgesuch as knowledge inside employeesrsquo heads is not possible simply by an intranet or adatabase [23] That is the current state of IT may not affect socialization externalizationor internalization directly

Our study shows that organizational creativity affects organizational performance(b = 06338 p lt 001) This result is in line with previous studies [73 102] Forexample Shani et al [102] provided a framework linking organizational performance

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 215

and organizational creativity through a field study of the Seagate Corporation It im-plies that managers pay more attention to organizational creativity in order to im-prove organizational performance Although the relationship is statistically significantthe percentage of total variation of organizational performance explained by organi-zational creativity is relatively low (R2 = 0402) This may reflect the creativity para-dox [116] If creativity is encouraged and reinforced at the expense of operationalbehaviors it may decrease organizational performance That is organizational cre-ativity is valuable but its overencouragement may not be always useful

Conclusions

OUR STUDY IS OF INTEREST FROM BOTH theoretical and practical perspectivesTheoretically a framework is proposed for empirical studies to link knowledge

management enablers and processes with organizational performance This study isprobably the first to establish this integrative view of knowledge management Weadopt a process-oriented perspective of knowledge by using Nonakarsquos creation model[82] Our framework may be used as a stepping stone for further empirical researchon knowledge management To strengthen the feasibility of this framework we canclarify the role of knowledge creation process (see Appendix C) and intermediateoutcome (see Appendix D)

From a practical point of view the relationships among knowledge creation orga-nizational creativity and organizational performance may provide a clue as to howfirms can adjust knowledge creation processes to sustain their performance Further-more managers will be better able to find which enablers are critical for knowledgecreation Because firms may not manage all modes of knowledge creation they mayneed robust strategies that involve trade-offs

The current findings of this study may indicate the following avenues for furtherresearch First an analysis of different factors such as domain knowledge [101] orother types of knowledge process may lead to interesting implications For examplean interesting candidate is Szulanskirsquos knowledge transfer model which is made upof four processesmdashinitiation implementation ramp-up and integration [114] Sec-ond our study shows which knowledge enablers can enhance a firmrsquos capability tomanage knowledge Appropriate knowledge management strategies may be able tofacilitate these enablers Finding these strategies may be of interest Third what is theeffect of our findings on electronic commerce Electronic commerce is changing thebusiness world rapidly The quality of knowledge management may determine a suc-cess template for electronic commerce For example Holsapple and Singh [50] pro-posed the potential benefits of applying knowledge management principles to electroniccommerce Finally other types of performance measures may sharpen the results ofour study ROI3 (return on ideas return on information and return on investment)[73] or a strategy map [63] is a good alternative

Acknowledgments This work was supported in part by a grant from KOSEF (98-0102-08-01-3)

216 LEE AND CHOI

REFERENCES

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2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

216 LEE AND CHOI

REFERENCES

1 Adler P Goldoftas B Levine D Flexibility versus efficiency A case study of modelchangeovers in the Toyota production system Organization Science 10 1 (1999) 43ndash68

2 Alavi M and Leidner DE Review Knowledge management and knowledge man-agement systems Conceptual foundations and research issues MIS Quarterly 25 1 (2001)107ndash136

3 Albaum G The Likert scale revisited An alternative version Journal of the MarketResearch Society 39 2 (1997) 331ndash348

4 Amabile TM A model of creativity and innovation in organizations In BM Staw andLL Cummings (eds) Research in Organizational Behavior vol 10 Greenwich CT JAIPress 1988 pp 123ndash167

5 Amabile TM Conti R Coon H Lazenby J and Herron M Assessing the workenvironment for creativity Academy of Management Journal 39 5 (1996) 1154ndash1184

6 Appleyard M How does knowledge flow Interfirm patterns in the semiconductorindustry Strategic Management Journal 17 10 (Winter 1996) 137ndash154

7 Baron RM and Kenny DA The moderator-mediator variable distinction in socialpsychological research Conceptual strategic and statistical considerations Journal of Per-sonality and Social Psychology 51 6 (1986) 1173ndash1182

8 Becerra-Fernandez I and Sabherwal R Organizational knowledge management Acontingency perspective Journal of Management Information Systems 18 1 (Summer 2001)23ndash55

9 Beckman T The current state of knowledge management In J Liebowitz (ed) Knowl-edge Management Handbook Boca Raton FL CRC Press 1999 pp 1-1ndash1-22

10 Bennett R and Gabriel H Organizational factors and knowledge management withinlarge marketing departments An empirical study Journal of Knowledge Management 3 3(1999) 212ndash225

11 Bierly P and Chakrabarti A Generic knowledge strategies in the US pharmaceuticalindustry Strategic Management Journal 17 10 (Winter 1996) 123ndash135

12 Bostrom R and Heinen J MIS problems and failures A socio-technical perspectiveMIS Quarterly 1 3 (1977) 17ndash32

13 Brown J and Eisenhardt K Product development Past research present findingsand future directions Academy of Management Review 20 2 (1995) 343ndash378

14 Caruana A Morris MH and Vella AJ The effect of centralization and formaliza-tion on entrepreneurship in export firms Journal of Small Business Management 36 1 (1998)16ndash29

15 Chase R The knowledge-based organization An international survey Journal of Knowl-edge Management 1 1 (1997) 38ndash49

16 Choi B and Lee H Knowledge management strategy and its link to knowledge cre-ating process Expert Systems with Applications 23 3 (2002) 173ndash187

17 Damanpour F Organizational innovation A meta-analysis of effects of determinantsand moderators Academy of Management Journal 34 3 (1991) 555ndash590

18 Davenport TH Knowledge management and the broader firm Strategy advantageand performance In J Liebowitz (ed) Knowledge Management Handbook Boca Raton FLCRC Press 1999 pp 2-1ndash2-11

19 Davenport TH and Prusak L Working Knowledge Boston Harvard Business SchoolPress 1998

20 Davenport TH Long D and Beers MC Successful knowledge management projectsSloan Management Review 39 2 (Winter 1998) 43ndash57

21 Demarest M Understanding knowledge management Long Range Planning 30 3(1997) 374ndash384

22 Deshpande R Jarley U and Webster F Corporate culture customer orientation andinnovativeness in Japanese firms A quadrad analysis Journal of Marketing 57 1 (January1993) 23ndash37

23 DeTienne KB and Jackson LA Knowledge management Understanding theoryand developing strategy Competitiveness Review 11 1 (2001) 1ndash11

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 217

24 Dougherty D and Corse SM When it comes to product innovation what is so badabout bureaucracy Journal of High Technology Management Research 6 1 (1995) 55ndash76

25 Drew S From knowledge to action The impact of benchmarking on organizationalperformance Long Range Planning 30 3 (1997) 427ndash441

26 Duncan RB The ambidextrous organization Designing dual structures for innova-tion In RH Kilmann LR Pondy and DP Slevin (eds) The Management of OrganizationStrategy and Implementation New York North-Holland 1976 pp 167ndash188

27 Ein-Dor P and Segev E Organizational context and MIS structure Some empiricalevidence MIS Quarterly 6 3 (1982) pp 55ndash68

28 Elenkov DS Effects of leadership on organizational performance in Russian compa-nies Journal of Business Research 55 6 (2002) 467ndash480

29 Eppler MJ and Sukowski O Managing team knowledge Core processes tools andenabling factors European Management Journal 18 3 (2000) 334ndash341

30 Fahey L and Prusak L The eleven deadliest sins of knowledge management Califor-nia Management Review 40 4 (1998) 265ndash276

31 Galliers RD Newell S Huang JC and Pan SL Implementing enterprise re-source planning and knowledge management systems in tandem Fostering efficiency and in-novation complementarity Information and Organization forthcoming 2003

32 Garland R The mid-point on a rating scale Is it desirable Marketing Bulletin 2 (May1991) 66ndash70

33 Ghemawat P and Costa R The organizational tension between static and dynamicefficiency Strategic Management Journal 14 8 (Winter 1993) 59ndash73

34 Glynn M Innovative genius A framework for relating individual and organizationalintelligence to innovation Academy of Management Review 21 4 (1996) 1081ndash1111

35 Gold AH Malhotra A and Segars AH Knowledge management An organiza-tional capabilities perspective Journal of Management Information Systems 18 1 (Summer2001) 185ndash214

36 Gottschalk P Strategic knowledge networks The case of IT support for Eurojuris lawfirms in Norway International Review of Law Computers amp Technology 14 1 (2000) 115ndash129

37 Graham AB and Pizzo VG A question of balance Case studies in strategic knowl-edge management European Management Journal 14 4 (1996) 338ndash346

38 Grover V and Davenport TH General perspectives on knowledge management Fos-tering a research agenda Journal of Management Information Systems 18 1 (Summer 2001)5ndash21

39 Gupta AK and Govindarajan V Knowledge managementrsquos social dimension Les-sons from Nucor steel Sloan Management Review 42 1 (Fall 2000) 71ndash80

40 Gurteen D Knowledge creativity and innovation Journal of Knowledge Manage-ment 2 1 (1998) 5ndash13

41 Hackerman J and Morris C Group tasks group interaction process and group per-formance effectiveness A review and proposed integration In L Berkowitz (ed) Group Pro-cess New York Academic Press 1978 pp 1ndash15

42 Hair JF Anderson R Tatham R and Black W Multivariate Data Analysis withReadings Englewood Cliffs NJ Prentice Hall 1995

43 Hansen MT The search-transfer problem The role of weak ties in sharing knowledgeacross organization subunits Administrative Science Quarterly 44 1 (1999) 82ndash111

44 Hansen MT and Oetinger B Introducing T-shaped managers Knowledgemanagementrsquos next generation Harvard Business Review 79 3 (March 2001) 107ndash116

45 Hansen MT Nohria N and Tierney T Whatrsquos your strategy for managing knowl-edge Harvard Business Review 77 2 (MarchndashApril 1999) 106ndash116

46 Hater JJ and Bass BM Superiorsrsquo evaluations and subordinates perceptions of trans-formational and transactional leadership Journal of Applied Psychology 73 4 (1988) 695ndash702

47 Hedlund G A model of knowledge management and the N-form corporation StrategicManagement Journal 15 5 (1994) 73ndash90

48 Herbold RJ Inside Microsoft Balancing creativity and discipline Harvard BusinessReview 80 1 (January 2002) 72ndash79

49 Holsapple CW and Joshi KD Organizational knowledge resources Decision Sup-port Systems 31 1 (2001) 39ndash54

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

218 LEE AND CHOI

50 Holsapple CW and Singh M Electronic commerce From a definitional taxonomytoward a knowledge-management view Journal of Organizational Computing and ElectronicCommerce 10 3 (2000) 149ndash170

51 Holsapple CW and Singh M The knowledge chain model Activities for competi-tiveness Expert Systems with Applications 20 1 (2001) 77ndash98

52 Hopper MD Rattling SABRE-new ways to compete on information Harvard Busi-ness Review 68 3 (MayndashJune 1990) 118ndash125

53 Howells J Knowledge innovation and locations In JR Bryson PW Daniels NDHenry and JS Pollard (eds) Knowledge Space Economy London Routledge 2000 pp50ndash62

54 Huemer L Krogh G and Johan R Knowledge and the concept of trust In G KroghJ Roos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 123ndash145

55 Hurley R and Hult T Innovation market orientation and organizational learning Anintegration and empirical examination Journal of Marketing 62 3 (1998) 42ndash54

56 Iansiti M Real-world RampD Jumping the product generation gap Harvard BusinessReview 71 3 (1993) 138ndash147

57 Ichijo K Krogh G and Nonaka I Knowledge enablers In G Krogh J Roos and DKleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 173ndash203

58 James LR Demaree RG and Wolf G rwg An assessment of within-group interrateragreement Journal of Applied Psychology 78 2 (1993) 306ndash309

59 Jarvenpaa SL and Staples DS The use of collaborative electronic media for infor-mation sharing An exploratory study of determinants Strategic Information Systems 9 2ndash3(2000) 129ndash154

60 Johannenssen J-A Olsen B and Olaisen J Aspects of innovation theory based onknowledge management International Journal of Information Management 19 2 (1999)121ndash139

61 Junnarkar B Leveraging collective intellect by building organizational capabilitiesExpert Systems with Applications 13 1 (1997) 29ndash40

62 Kanevsky V and Housel T The learning-knowledge-value cycle In G Krogh JRoos and D Kleine (eds) Knowing in Firms Thousand Oaks CA Sage 1998 pp 269ndash284

63 Kaplan R and Norton D Having trouble with your strategy Then map it HarvardBusiness Review 78 5 (SeptemberndashOctober 2000) 167ndash176

64 Kerlinger FN Foundation of Behavioral Research 3d ed Fort Worth TX Holt Rinehartand Winston 1986

65 Koh AT Linking learning knowledge creation and business creativity A preliminaryassessment of the East Asian quest for creativity Technological Forecasting and Social Change64 1 (2000) 85ndash100

66 Kozlowski W and Hattrup K A disagreement about within-group agreement Disen-tangling issues of consistency versus consensus Journal of Applied Psychology 77 2 (1992)161ndash167

67 Kreitner R and Kinicki A Organizational Behavior Homewood IL Richard DIrwin 1992

68 Krogh G Care in the knowledge creation California Management Review 40 3 (1998)133ndash153

69 Krogh G Nonaka I and Aben M Making the most of your companyrsquos knowledgeA strategic framework Long Range Planning 34 4 (2001) 421ndash439

70 Leonard-Barton D Wellsprings of Knowledge Building and Sustaining the Sources ofInnovation Boston Harvard Business School Press 1995

71 Long DD Building the knowledge-based organizations How culture drives knowl-edge behaviors Working Paper of the Center for Business Innovation Ernst amp Young LLPCambridge MA 1997

72 Lubit R Tacit knowledge and knowledge management The keys to sustainable com-petitive advantage Organizational Dynamics 29 4 (2001) 164ndash178

73 Lusch RF Harvey M and Speier C ROI3 The building blocks for successful glo-bal organizations in the 21st century European Management Journal 16 6 (1998) 714ndash728

74 Madhavan R and Grover R From embedded knowledge to embodied knowledgeNew product development as knowledge management Journal of Marketing 62 4 (1998)1ndash12

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 219

75 Maeil Business Newspaper Annual Corporation Reports CD-ROM Maeil BusinessNewspaper Company Seoul Korea 2000

76 Markus ML Toward a theory of knowledge reuse Types of knowledge reuse situa-tions and factors in reuse success Journal of Management Information Systems 18 1 (Sum-mer 2001) 57ndash93

77 Menon A and Varadarajan R A model of marketing knowledge use within firmsJournal of Marketing 56 4 (1992) 53ndash71

78 Miller DA A preliminary typology of organizational learning Synthesizing the litera-ture Journal of Management 22 3 (1996) 484ndash505

79 Nahapiet J and Ghoshal S Social capital intellectual capital and the organizationaladvantage Academy of Management Review 23 2 (1998) 242ndash266

80 Ndlela LT and Toit ASA Establishing a knowledge management programme forcompetitive advantage in an enterprise International Journal of Information Management 212 (2001) 151ndash165

81 Nelson KM and Cooprider JG The contribution of shared knowledge to IS groupperformance MIS Quarterly 20 4 (1996) 409ndash429

82 Nonaka I and Takeuchi H The Knowledge Creating Company New York OxfordUniversity Press 1995

83 Nonaka I Byosiere P and Konno N Organizational knowledge creation theory Afirst comprehensive test International Business Review 3 4 (1994) 337ndash351

84 Nunnally JC Psychometric Theory 2d ed New York McGraw-Hill 197885 OrsquoDell C and Grayson J Knowledge transfer discover your value proposition Strat-

egy amp Leadership 27 2 (MarchndashApril 1999) 10ndash1586 Pan S and Scarbrough H A socio-technical view of knowledge-sharing at Buckman

laboratories Journal of Knowledge Management 2 1 (1998) 55ndash6687 Parent M Gallupe RB Salisbury WD and Handelman JM Knowledge creation

in focus group Can group technologies help Information amp Management 38 1 (2000) 47ndash5888 Quinn JB Anderson P and Finkelstein S Leveraging intellect Academy of Man-

agement Executive 10 3 (1996) 7ndash2789 Rapert M and Wren B Reconsidering organizational structure A dual perspective of

frameworks and processes Journal of Managerial Issues 10 3 (1998) 287ndash30290 Raven A and Prasser SG Information technology support for the creation and trans-

fer of tacit knowledge in organizations In R Ramsower (ed) Association for InformationSystems 1996 Americas Conference Phoenix CAIS 1996 (available at hsbbayloreduramsoweraisac96papersRAVENhtm)

91 Riggins FJ and Rhee H Developing the learning network using extranets Interna-tional Journal of Electronic Commerce 4 1 (Fall 1999) 65ndash83

92 Roberts J From know-how to show-how Questioning the role of information andcommunication technologies in knowledge transfer Technology Analysis amp Strategic Manage-ment 12 4 (2000) 429ndash443

93 Robinson AG and Stern S Corporate Creativity How Innovation and ImprovementActually Happen San Francisco CA Berrett-Koehler 1997

94 Rogers E Diffusion of Innovations 3d ed New York Free Press 198395 Rubenstein-Montano B Liebowitz J Buchwalter J McCaw D Newman B and

Rebeck K The knowledge management methodology team A systems thinking frameworkfor knowledge management Decision Support Systems 31 1 (2001) 5ndash16

96 Sarvary M Knowledge management and competition in the consulting industry Cali-fornia Management Review 41 2 (1999) 95ndash107

97 Sawhney M and Prandelli E Communities of creation Managing distributed innova-tion in turbulent markets California Management Review 42 4 (2000) 24ndash54

98 Scharmer CO Organizing around not-yet-embodied knowledge In G Krogh I Nonakaand T Nishiguchi (eds) Knowledge Creation A Source of Value New York St MartinrsquosPress 2000 pp 36ndash60

99 Scott JE Organizational knowledge and the internet Decision Support Systems 23 1(1998) 3ndash17

100 Scott JE Facilitating interorganizational learning with information technology Jour-nal of Management Information Systems 17 2 (Fall 2000) 81ndash113

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

220 LEE AND CHOI

101 Shaft TM and Vessey I The relevance of application domain knowledge Character-izing the computer program comprehension process Journal of Management Information Sys-tems 15 1 (Summer 1998) 51ndash78

102 Shani AB Sena JA and Stebbins MW Knowledge work teams and groupwaretechnology Learning from Seagatersquos experience Journal of Knowledge Management 4 2(2000) 111ndash124

103 Shrout PE and Fliess JL Interclass correlation Uses in assessing rater reliabilityPsychological Bulletin 86 3 (1979) 420ndash428

104 Simonin B The importance of collaborative know-how An empirical test of the learn-ing organization Academy of Management Journal 40 5 (1997) 509ndash533

105 Spek R and Spijkervet A Knowledge management Dealing intelligently with knowl-edge In J Liebowitz and L Wilcox (eds) Knowledge Management and Its Integrative Ele-ments Boca Raton FL CRC Press 1997 pp 31ndash59

106 Starbuck WH Learning by knowledge-intensive firms Journal of Management Stud-ies 29 6 (1992) 713ndash740

107 Stein EW and Zwass V Actualizing organizational memory with information sys-tems Information Systems Research 6 2 (1995) 85ndash117

108 Stonehouse GH and Pemberton JD Learning and knowledge management in theintelligent organization Participation amp Empowerment An International Journal 7 5 (1999)131ndash144

109 Strock J and Hill PA Knowledge diffusion through ldquostrategic communitiesrdquo SloanManagement Review 41 2 (Winter 2000) 63ndash74

110 Sveiby K The New Organization Wealth Management and Measuring Knowledge-Based Assets San Francisco Berrett-Koehler 1997

111 Swan J Newell S and Robertson M Limits of IT-driven knowledge managementfor interactive innovation processes Towards a community-based approach In RH SpragueJr (ed) Proceedings of the Thirty-Third Hawaii International Conference on System Sci-ences Los Alamitos CA IEEE Computer Society Press 2000 pp 84ndash94

112 Swap W Leonard D Shields M and Abrams L Using mentoring and storytellingto transfer knowledge in the workplace Journal of Management Information Systems 18 1(Summer 2001) 95ndash114

113 Swieringa J and Wierdsma A Becoming a Learning Organization Beyond the Learn-ing Curve Wokingham UK Addison-Wesley 1992

114 Szulanski G Exploring internal stickiness Impediments to the transfer of best practicewithin the firm Strategic Management Journal 17 10 (Winter 1996) 27ndash43

115 Teece DJ Strategies for managing knowledge assets The role of firm structure andindustrial context Long Range Planning 33 4 (2000) 35ndash54

116 Thompson KR Confronting the paradoxes in a total quality environment Organiza-tional Dynamics 23 3 (1998) 62ndash74

117 Tushman ML and OrsquoReilly CA Winning Through Innovation Boston HarvardBusiness School Press 1997

118 Venkatraman N and Grant JH Construct measurement in organizational research Acritique and proposal Academy of Management Review 11 1 (1986) 71ndash87

119 Vicari S and Troilo G Organizational creativity A new perspective from cognitivesystems theory In G Krogh I Nonaka and T Nishiguchi (eds) Knowledge Creation ASource of Value New York St Martinrsquos Press 2000 pp 63ndash88

120 Weiser M and Morrison J Project memory Information management for projectteams Journal of Management Information Systems 14 4 (Spring 1998) 149ndash166

121 Wilkstrom S and Norman R Knowledge amp Value A New Perspective on CorporateTransformation London Routledge 1994

122 Woodman R Sawyer J and Griffin R Toward a theory of organizational creativityAcademy of Management Review 18 2 (1993) 293ndash321

123 Wright P and Snell S Toward a unifying framework for exploring fit and flexibilityin strategic human resource management Academy of Management Review 23 4 (1998)756ndash772

124 Zander D and Kogut B Knowledge and the speed of the transfer and imitation oforganizational capabilities An empirical test Organization Science 6 1 (1995) 76ndash92

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 221

125 Zbaracki M The rhetoric and reality of total quality management Administrative Sci-ence Quarterly 43 3 (1998) 602ndash636

126 Zucker LG Darby MR Brewer M B and Peng Y Collaboration structures andinformation dilemmas in biotechnology Organization boundaries as trust production In RMKramer and TR Tyler (eds) Trust in Organizations Frontiers of Theory and Research Thou-sand Oaks CA Sage 1996 pp 90ndash113

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

222 LEE AND CHOI

Appendix A Operational Definitions and Related Literature

Variables Operational definition Related literature

Collaboration Degree of active support and helps in [54 67 85 100]organization

Trust Degree of reciprocal faith in othersrsquo intentions [19 54 57 68 74behaviors and skills toward organizational 81 85]goals

Learning Degree of opportunity variety satisfaction [55 62 88 113]and encouragement for learning anddevelopment in organization

Centralization Degree of authority and control over decisions [14 17 27 47 89115]

Formalization Degree of formal rules procedures and [14 34 89 106standard polices 115]

T-shaped skills Degree of understanding his or her own and [56 60 70 74]othersrsquo task areas

IT support Degree of IT support for collative work for [20 35 87 90 99]communication for searching and accessingfor simulation and prediction and forsystematic storing

Knowledge Degree of socialization externalization [82 83]creation combination and internalization

Socialization Degree of tacit knowledge accumulation [82 83]extra-firm social information collectionintra-firm social information gathering andtransfer of tacit knowledge

Externalization Degree of creative dialogue deductive and [82 83]inductive thinking use of metaphors andexchanged ideas

Combination Degree of acquisition and integration [82 83]synthesis and processing and dissemination

Internalization Degree of personal experiences simulation [82 83]and experimentation

Organizational Degree of belief that organizations is actually [5 34 40 65 119creativity producing creative (noveluseful) ideas 122]

(servicesproducts)

Organizational Degree of overall success market share [22 25]performance growth rate profitability and innovativeness

in comparison with major competitors

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 223

Appendix B Questionnaire

(1) Knowledge management enablers

Construct Items

Collaboration COL1 Our organization members are satisfied by the degree of(COL five items) collaboration

COL2 Our organization members are supportiveCOL3 Our organization members are helpfulCOL4 There is a willingness to collaborate across organizationalunits within our organizationCOL5 There is a willingness to accept responsibility for failure

Trust Our company members (TRU six items) TRU1 are generally trustworthy

TRU2 have reciprocal faith in other membersrsquo intentions andbehaviorsTRU3 have reciprocal faith in othersrsquo abilityTRU4 have reciprocal faith in othersrsquo behaviors to work towardorganizational goalsTRU5 have reciprocal faith in othersrsquo decision towardorganizational interests than individual interestsTRU6 have relationships based on reciprocal faith

Learning Our company (LEA five items) LEA1 provides various formal training programs for performance

of dutiesLEA2 provides opportunities for informal individual developmentother than formal training such as work assignments and jobrotationLEA3 encourages people to attend seminars symposia and so onLEA4 provides various programs such as clubs and communitygatheringsLEA5 members are satisfied by the contents of job training orself-development programs

Centralization Our company members (CEN five items) CEN1 can take action without a supervisor (R)

CEN2 are encouraged to make their own decisions (R)CEN3 do not need to refer to someone else (R)CEN4 do not need to ask their supervisor before action (R)CEN5 can make decisions without approval (R)

Formalization In our company (FOR five items) FOR1 there are many activities that are not covered by some formal

procedures (R)FOR2 contacts with our company are on a formal or plannedbasisFOR3 rules and procedures are typically writtenFOR4 members can ignore the rules and reach informalagreements to handle some situations (R)FOR5 members make their own rules on the job (R)

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

224 LEE AND CHOI

Construct Items

T-shaped skills Our company members (TKS five items) TSK1 can understand not only their own tasks but also othersrsquo

tasksTSK2 can make suggestion about othersrsquo taskTSK3 can communicate well not only with their departmentmembers but also with other department membersTSK4 are specialists in their own partTSK5 can perform their own task effectively without regard toenvironmental changes

IT support Our company (ITS five items) ITS1 provides IT support for collaborative works regardless of time

and placeITS2 provides IT support for communication among organizationmembersITS3 provides IT support for searching for and accessing necessaryinformationITS4 provides IT support for simulation and predictionITS5 provides IT support for systematic storing

ldquoRrdquo indicates that the item is actually measured in a reverse fashion

(2) Knowledge creation processes

Construct Items

Socialization Our company stresses (KCS five items)Tacit knowledge accumulation KCS1 gathering information from sales and

production sitesTacit knowledge accumulation KCS2 sharing experience with suppliers and

customersExtra-firm social information KCS3 engaging in dialogue with competitors collectionIntra-firm social information KCS4 finding new strategies and market collection opportunities by wandering inside the firmTransfer of tacit knowledge KCS5 creating a work environment that allows peers

to understand the craftsmanship and expertise

Externalization Our company stresses (KCE five items)Dialogue KCE1 creative and essential dialoguesMetaphor KCE2 the use of deductive and inductive thinkingMetaphor KCE3 the use of metaphors in dialogue for concept

creationDialogue KCE4 exchanging various ideas and dialoguesDialogue KCE5 subjective opinions

Combination Our company stresses (KCC five items)Acquisition and integration KCC1 planning strategies by using published

literature computer simulation and forecastingSynthesis and processing KCC2 creating manuals and documents on products

and services

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 225

Synthesis and processing KCC3 building databases on products and serviceSynthesis and processing KCC4 building up materials by gathering

management figures and technical informationDissemination KCC5 transmitting newly created concepts

Internalization Our company stresses (KCI four items)Personal experience KCI1 enactive liaisoning activities with functional(knowledge acquisition departments by cross-functional developmentform real world) teamsExperimentation (knowledge KCI2 forming teams as a model and conductingacquisition from virtual world) experiments and sharing results with entire

departmentsPersonal experience KCI3 searching and sharing new values and

thoughtsPersonal experience KCI4 sharing and trying to understand management

visions through communications with fellows

(3) Organizational creativity

Construct Items

Creativity Our company (OC five items) OC1 has produced many novel and useful ideas

(servicesproducts)OC2 fosters an environment that is conductive to our own ability toproduce novel and useful ideas (servicesproducts)OC3 spends much time for producing novel and useful ideas(servicesproducts)OC4 considers producing novel and useful ideas(servicesproducts) as important activitiesOC5 actively produces novel and useful ideas (servicesproducts)

(4) Organizational performance

Construct Items

Organizational Compared with key competitors our company performance OP1 is more successful(OP five items) OP2 has a greater market share

OP3 is growing fasterOP4 is more profitableOP5 is more innovative

Note Linkage between knowledge creation constructs and our questionnaire items

Questionnaire items for the knowledge creation process which were used in thisstudy had been validated and used by Nonaka et al [83] They conducted a confirma-tory factor analysis to test Nonakarsquos [82] organizational knowledge creation modelwith data collected from 105 Japanese middle managers Results of the study suggestthat the construct of knowledge creation consists of four knowledge conversion pro-cesses socialization externalization combination and internalization All four knowl-edge conversion processes explain a high amount of variance in the knowledge creation

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

226 LEE AND CHOI

construct Four factors constitute the process of converting tacit to tacit knowledgeaccumulation of tacit knowledge extra-firm social information gathering activitiesintra-firm social information gathering activities and transfer of tacit knowledge fromthe master to the different team members Externalization process is made up of onefactor This result differs from Nonakarsquos theory that hypothesized that metaphor anddialogue would be retained Combination process consists of three factors that repre-sent a three-step sequence of data processing acquisition and integration of informa-tion synthesis and processing of information and dissemination of informationExplicit knowledge in the organization may be converted into tacit knowledge (inter-nalization) in two different ways personal experience in which knowledge is ac-quired from real world and simulation and experimentation in which knowledge isacquired from the virtual world

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

KM ENABLERS PROCESSES AND ORGANIZATIONAL PERFORMANCE 227

Appendix C Mediating Effect of Knowledge Creation Process

OUR STUDY HINTS THAT KNOWLEDGE CREATION process mediates between enablersand organizational creativity However some recent studies regard both knowledgeenablers and knowledge creation process as antecedents of organizational perfor-mance [8 35] that is both of them are independent variables of organizational per-formance Therefore in order to test the mediating effect of knowledge creation processthe Baron and Kenny [7] procedure is adopted Table A1 shows this analysis resultThis results in the mediation effect because the following three conditions hold Firstknowledge enablers affect knowledge creation process significantly It has been notedthat collaboration trust learning and centralization affect creation However this isnot the case with formalization T-shaped skills and IT support we could not assessthe mediating effect for these three enablers Second collaboration trust learningand centralization affect organizational creativity Third knowledge creation processaffects creativity (b = 07042) while the effects of the previous four enablers are re-duced For example in the case of collaboration its beta value is reduced from 02144to 01316 In sum we may point out that knowledge creation process mediates be-tween the four enablers (collaboration trust learning and centralization) and organi-zational creativity

Table A1 Mediation Analysis Result

Knowledge Organizational Organizationalcreation creativity creativity

(beta values) (beta values) (beta values)

Collaboration 02085 02144 01316Trust 03525 03916 01353Learning 02138 02015 01291Centralization ndash02030 ndash01808 ndash01047Formalization ndash00130 ndash00390 ndash00296T-shaped skills 00443 01682 01514IT support 00611 00949 00493Knowledge creation 07442

p lt 001 p lt 005 p lt 01

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously

228 LEE AND CHOI

Appendix D Mediating Effect of Intermediate Outcome

IN ORDER TO VALIDATE WHETHER an intermediate outcome is an important predictorof knowledge management or not another model without organizational creativity isbuilt to explore the direct relationship between knowledge creation and organiza-tional performance Testing this direct relationship indicates no significant relation-ships except for socialization (b = 0540 p lt 005) This result is consistent with theprevious study [18] It implies that the intermediate outcome can help build a chain ofcredibility between knowledge creation and organizational performance

Although not the focus of this study it is of interest to note an alternative concurrentmodel in organization theory This model would posit that efficiency and bureaucratic(or mechanistic) structures would chain through to organizational performance Forexample centralization can lead to efficiency because it prevents a strategic vacuum oforganizations and enables the development of precise control procedures [30] In addi-tion formalization has been found to lead to efficiency because it may facilitate therapid and continuous transformation of ideas into superior products and services andenhance communication flow through their extensive monitoring and reporting require-ments [36] Similarly standardizing business practices may encourage efficiency [48]

Related to an interplay between creativity (flexibility) and efficiency it has beenassumed that a firm must either focus on efficiency or flexibility [33 123] That isflexibility (or efficiency) can only be achieved at the cost of efficiency (or flexibility)Therefore some researchers have concentrated on improving efficiency [125] whereasothers have focused on how to improve flexibility and creativity [13]

However there are now a few studies that have suggested that it is possible to besimultaneously efficient and flexible [24 31] Organizations can obtain their com-petitive advantages through achieving efficiency by emphasizing control as well asflexibility (creativity) by creating knowledge [117] Case studies such as Microsoft[48] Unilever [69] and NUMMI (a Toyota subsidiary) [1] have shown this simulta-neous approach These studies suggest that balancing between imposing disciplinefor efficiency and delegating authority to encourage flexibility and creativity pro-vides tremendous benefits for organizations

In summary some studies insist that efficiency and flexibility are mutually exclu-sive whereas others argue that they are perfectly compatible Our study focuses oncreativity (flexibility) only The interplay between these creativity forces and efficiencyforces should be further investigated in the field of knowledge management For ex-ample Krogh et al [69] indicated that knowledge management allows an organizationto improve both its efficiency and flexibility (innovation) capabilities simultaneously