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Page 1: Knowledge management in SMEs: a literature review

Journal of Knowledge ManagementKnowledge management in SMEs: a literature reviewSusanne Durst Ingi Runar Edvardsson

Article information:To cite this document:Susanne Durst Ingi Runar Edvardsson, (2012),"Knowledge management in SMEs: a literature review", Journal of Knowledge Management,Vol. 16 Iss 6 pp. 879 - 903Permanent link to this document:http://dx.doi.org/10.1108/13673271211276173

Downloaded on: 05 November 2014, At: 07:09 (PT)References: this document contains references to 69 other documents.To copy this document: [email protected] fulltext of this document has been downloaded 3131 times since 2012*

Users who downloaded this article also downloaded:Kevin C. Desouza, Yukika Awazu, (2006),"Knowledge management at SMEs: five peculiarities", Journal of Knowledge Management, Vol. 10Iss 1 pp. 32-43Rodney McAdam, Renee Reid, (2001),"SME and large organisation perceptions of knowledge management: comparisons and contrasts",Journal of Knowledge Management, Vol. 5 Iss 3 pp. 231-241Kuan Yew Wong, Elaine Aspinwall, (2004),"Characterizing knowledge management in the small business environment", Journal ofKnowledge Management, Vol. 8 Iss 3 pp. 44-61

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Page 2: Knowledge management in SMEs: a literature review

Knowledge management in SMEs:a literature review

Susanne Durst and Ingi Runar Edvardsson

Abstract

Purpose – The aim of this paper is to review research on knowledge management in small and

medium-sized enterprises to identify gaps in the current body of knowledge, which justify futureresearch directions.

Design/methodology/approach – The study consists of a systematic review of 36-refereed empirical

articles on knowledge management and small and medium-sized enterprises.

Findings – The areas of knowledge management implementation, knowledge management

perception, and knowledge transfer are relatively well researched topics; whereas those of

knowledge identification, knowledge storage/retention and knowledge utilisation are poorlyunderstood. Given the prevalence of small and medium-sized enterprises there is a strong need for

more research on this important topic. The future research directions proposed by the authors may helpto develop a greater understanding of knowledge management in small and medium-sized enterprises.

Research limitations/implications – By only using the ProQuest database this study may not have

allowed a complete coverage of all empirical articles in the field of knowledge management in small andmedium-sized enterprises. Yet, it is believed that the findings provide a valuable understanding of the

current situation in this research field. The study proposes a number of future research directions, whichmay stimulate more intensive research in this important field.

Originality/value – To the best of the authors’ knowledge, no systematic literature review on this topic

has previously been published in academic journals.

Keywords Knowledge management, Small to medium-sized enterprises, Systematic review,Entrepreneurship, Research

Paper type Literature review

1. Introduction

Eleven years ago McAdam and Reid (2001) wrote that knowledge management (KM), like

other management practices, was invented and developed in large organizations to be

applied later on in small and medium-sized enterprises (SMEs). Has this been the case? Has

the knowledge management field directed its attention to small and medium-sized

enterprises as well? The paper’s intention is to delve into this matter and detect what has

happened in the field of KM in SMEs since 2001. This would help to highlight the current

understanding of the topic and to identify any gaps.

In the extant literature different approaches about how knowledge management may evolve

are available (e.g. Wong and Aspinwall, 2004; Egbu et al., 2005; Hutchinson and Quintas,

2008). However, as Beesley and Cooper (2008) rightly point out, uniform definitions of the

building blocks of KM are lacking. KM research has tended to focus on processes and

structures within organizations, such as knowledge transfer from tacit to explicit,

organizational culture and learning, and technologies for knowledge storage and sharing

to enhance productivity and sales, reduce cost, or increase innovation and quality (Kluge

et al., 2001; Quintas, 2002; O’Dell et al., 2003; Edvardsson, 2009; Jashapara, 2011). To

explore extant literature, in this paper KM is defined as the processes and structures

DOI 10.1108/13673271211276173 VOL. 16 NO. 6 2012, pp. 879-903, Q Emerald Group Publishing Limited, ISSN 1367-3270 j JOURNAL OF KNOWLEDGE MANAGEMENT j PAGE 879

Susanne Durst is based at

the Institute for

Entrepreneurship,

University of Liechtenstein,

Vaduz, Principality of

Liechtenstein. Ingi Runar

Edvardsson is based in the

School of Business,

University of Iceland,

Reykjavik, Iceland.

Received: February 2012Revised: May 2012Accepted: May 2012

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Page 3: Knowledge management in SMEs: a literature review

provided in SMEs to support different knowledge processes, such as transfer, storage and

creation. In this paper, the definition of SMEs provided by the European Commission (2005)

is adopted which stipulates that micro enterprises have fewer than ten employees, a

maximum turnover of e2 million; small enterprises have 10-49 employees, a turnover of less

than e10 million, and medium-sized firms have 50-250 employees, and a turnover of no more

than e50 million.

Knowledge has become the most important strategic factor in corporate operations

(Spender, 1996), as it is associated with firms’ capabilities to achieve a competitive

advantage (Teece, 2001). Accordingly, companies have to find ways to adequately manage

this aspect, which poses a particular challenge for smaller firms as they usually lack the

resources needed to make full usage of their knowledge stock. Knowledge management

has been studied extensively. However, there is a tendency to focus on large businesses

and neglect SMEs. Against the background of SMEs’ significance to many countries, this

situation can be assessed as unsatisfactory. Previous studies have shown that in many

SMEs there is an absence of systematic knowledge management (McAdam and Reid, 2001;

Wong and Aspinwall, 2005) and if measures are implemented, they may be regarded as less

sophisticated. However, this does not mean that suitable approaches to tackle knowledge

management problems are less significant to SME success. Rather it may be argued that a

suitable handling of knowledge is a particularly important factor as to whether a firm survives

or not.

Keeping this in mind, the aim of this paper is to review research on KM within smaller firms to

identify gaps in the field justifying further research activities as well as to clarify areas where

no future research is needed for the time being. According to this aim, the following research

questions are formulated:

B Which KM topics are researched and which are not?

B Which were the main findings of the studies?

B Which methods were used?

B How does research handle the particular challenges small firms are facing regarding

knowledge management?

The paper is organised as follows: In section two the literature related to the research

objective is briefly discussed. Section three then describes the method employed to tackle

the research problem. Next, the results are presented, and in the final section, the

conclusion and implications of the study are laid out.

2. Knowledge management in small and medium-sized enterprises

Many smaller firms face resource constraints (Jarillo, 1989), and existing resources must

consequently be used with care, as erroneous decisions will have more serious

complications than would be the case in large businesses (Amelingmeyer and

Amelingmeyer, 2005). For example, small firms have a flat structure and an organic,

free-floatingmanagement style that encourages entrepreneurship and innovation. They tend

to be informal, non-bureaucratic and there are few rules. Control tends to be based on the

owner’s personal supervision and formal policies tend to be absent in SMEs (Daft, 2007).

In addition, in many smaller firms the owner-managers take on a central position (Bridge

et al., 2003). In such an environment it is not uncommon that the processes of business

planning and decision-making are limited to only one person (Culkin and Smith, 2000). This

centrality also signifies that those people in particular are responsible for recognising the

benefits of knowledge management to support the firm’s operations. However, SMEs’

day-to-day business operations specifically require close attention (Hofer and Charan,

1984). This very often results in situations where insufficient time is available for strategic

issues. This in conjunction with a lack of financial resources and expertise (Bridge et al.,

2003) frequently results in most knowledge being kept in the minds of the owner and some

key employees rather than physically stored or shared through substitution arrangements

PAGE 880 j JOURNAL OF KNOWLEDGE MANAGEMENTj VOL. 16 NO. 6 2012

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Page 4: Knowledge management in SMEs: a literature review

(Wong and Aspinwall, 2004). Thus knowledge sharing in SMEs may happen in corridor

conversations (Wong and Aspinwall, 2004) or at organization members’ birthday parties

(Durst and Wilhelm, 2012).

With a view to the above, SMEs face unique KM challenges which are distinct from those of

their larger business counterparts. Reviewing the literature related to small businesses

suggests that scholars tend to apply approaches originally developed for larger firms rather

than SMEs. This procedure involves the risk that smaller firms may lose their distinct

characteristics and thus their capability to act. Previous research on KM in SMEs has shown

many differences compared to larger firms. Most SMEs have no explicit policy targeted at

strategic KM, and they tend to treat KM on an operational level – at the level of systems and

instruments. SMEs tend to place more emphasis on management of tacit knowledge than

larger firms, and communication channels in SMEs are more likely to be between firms,

rather than internal to the organisation. The SME sector appears to be less advanced in

terms of knowledge construction, having a more mechanistic approach to this concept and

relying less on social interaction. Also, the SME sector is weaker than larger firms on formal

and systematic discussion in order to share tacit knowledge, since larger firms are stronger

in the implementation of formal KM strategy. Most SMEs adopt short-term unstructured ways

towards organisational learning, andmanagers in smaller firms tend to prevent the outflow of

knowledge from the company and thereby block knowledge sharing (Beijerse, 2000; Matlay,

2000; McAdam and Reid, 2001; Corso et al., 2003; Bozbura, 2007; Hutchinson and Quintas,

2008).

Activities related to knowledge management, such as knowledge sharing, are

time-consuming and require a certain level of trust. Slow staff turnover, as found in many

SMEs (Durst and Wilhelm, 2011), can positively contribute to those efforts.

What is often overlooked when researching SMEs is the issue of heterogeneity (Curran and

Blackburn, 2001). SMEs are difficult to compare, making the notion of one single knowledge

management approach almost impossible.

In this paper it is asserted, as others have (e.g. Wiig, 1997; McAdam and Reid, 2001; Wong

and Aspinwall, 2004), that approaches to knowledge identification, knowledge creation,

knowledge storage, knowledge dissemination, and knowledge application have a profound

impact on the firm’s ability to address current and future business challenges and therefore

its survival. Figure 1 depicts this situation in relation to SME characteristics.

Knowledge identification focuses on activities that help to identify the knowledge necessary

for the company, as well as sources to acquire this knowledge. This activity also comprises

the identification of already existing knowledge (Egbu et al., 2005). Knowledge creation

refers to ways, which focus on the construction of new knowledge. Knowledge creation in

companies can be supported by, for instance, giving organizational members time to

experiment (Gupta and Govindarajan, 2000). Knowledge is not only internally produced,

external knowledge sources need to be considered as well. Given their natural limitations,

SMEs are often forced to make use of the latter (Egbu et al., 2005). Knowledge

storage/retention embraces processes such as the documentation and codification of

knowledge to build up an organizational knowledge base and to reduce any forms of

knowledge loss due to retirement, departures of organization members and so forth. This

KM task might pose a real challenge for SMEs, as most knowledge is kept in the minds of the

owner and some key employees rather than physically stored or shared through substitution

arrangements (Wong and Aspinwall, 2004).

‘‘ Three areas of KM seem to be relatively well researched inSMEs: KM implementation, KM perception, and knowledgetransfer. ’’

VOL. 16 NO. 6 2012 j JOURNAL OF KNOWLEDGE MANAGEMENTj PAGE 881

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Page 5: Knowledge management in SMEs: a literature review

Knowledge transfer comprises measures relating to knowledge transfer and knowledge

sharing (Egbu et al., 2005). The distinction between tacit and explicit knowledge (Nonaka

and Takeuchi, 1995) is useful regarding this KM process, as the nature of the two types of

knowledge is likely to influence the ease of the transfer process. Lack of absorptive capacity

and low quality relationships between the individuals concerned represent other possible

hindrances of knowledge transfer (Szulanski, 1996) that need to be considered. Finally, the

usage or application of knowledge (knowledge utilisation) has to follow, as it is the only way

to create value within the company (Comite Europeen de Normalisation, 2004).

3. Methodology of literature review

In the review process, the authors adopted the principles of a systematic review as

recommended by Jesson et al. (2011) namely:

B Mapping the field through a scoping review.

B Comprehensive search.

B Quality assessment.

B Data extraction.

B Synthesis.

B Write up.

First, a research plan was developed comprising the research questions of interest, the

keywords, and a set of inclusion and exclusion criteria. The paper’s aim was to determine the

Figure 1 Size and KM process factors influencing SME survival

Survival

Knowledgemanagement

processes

SMEcharacteristics

Lack of resources

Flexibility

Smallness

Less formal

Lower turnoverrates

Knowledgeidentification

Knowledgecreation

Knowledgestorage/retention

Knowledgetransfer

Knowledgeutilisation

PAGE 882 j JOURNAL OF KNOWLEDGE MANAGEMENTj VOL. 16 NO. 6 2012

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Page 6: Knowledge management in SMEs: a literature review

current status of research in knowledge management in SMEs. The research questions

formulated, as outlined above, were:

B Which KM topics are well researched and which are not?

B Which were the main findings of the studies?

B Which methods were used?

With regard to the specific challenges SMEs face as a consequence of their resource

limitations, an additional question was posed:

B How does the research handle the particular challenges small firms are facing regarding

knowledge management?

As keywords it was decided to use KM and SMEs. To help answer the research questions

inclusion and exclusion criteria were specified. The inclusion criteria were: publications in

the period 2001-2011, empirical research papers, peer reviewed, English language, SME

focus, focus on KM in general and the KM processes as depicted in Figure 1, and ProQuest

database. Papers published prior 2001, papers dealing with co-operation and (regional)

clusters, grey literature such as reports and non-academic research, other languages than

English, and other databases than ProQuest represented exclusion criteria. Additionally, an

excel data sheet was produced consisting of key aspects related to the research aim. In the

given case these were: name of author(s), year of publication, research aim/objectives,

theoretical perspective/framework, method, main findings, and name of the journal.

Second, once all relevant issues had been specified, both authors accessed ProQuest and

looked for suitable articles. The initial search using the keywords knowledge management

and SMEs resulted in an unsatisfactory outcome in terms of the number of publications. So it

was decided to replace ‘‘knowledge management’’ by ‘‘KM’’ which in combination with

SMEs resulted in 398 hits. In order to make sure that the review included all papers from

relevant journals, the highest ranked KM journals according to Serenko and Bontis (2009)

were also included. These were the Journal of Knowledge Management, Journal of

Intellectual Capital and Knowledge Management Research and Practice. In addition, three

international ISI-journals in the field of small businesses were reviewed. These were the

International Small Business Journal, Journal of Small Business Management and

Entrepreneurship Theory and Practice. The inclusion of these journals resulted in

additional 697 hits.

Third, both authors individually worked through the abstracts and, if relevant, further

sections of the articles to make sure that they actually covered the pre-defined scope. This

procedure yielded a final selection of 36 articles, which fulfilled the criteria set and thus

represented the basis for analysis.

Fourth, the 36 papers were divided among the two authors; thus each author read 18

papers. Subsequently both authors entered the relevant data regarding the research aim in

the excel sheet. Then both authors jointly went through each data entry and discussed the

content. In the case of possible reservations on the part of the author who had not read the

paper, both authors went through the paper in question. This approach helped to reduce the

danger that the analysis and thus the conclusion drawn might not be consistent.

Fifth, then the final excel sheet was jointly discussed. This discussion enabled the authors to

categorize the findings under KM themes, which, in turn, helped to clarify what is known

‘‘ The [SME] body of knowledge regarding the topics ofknowledge identification, knowledge storage/retention, andknowledge utilisation is rather poor. ’’

VOL. 16 NO. 6 2012 j JOURNAL OF KNOWLEDGE MANAGEMENTj PAGE 883

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Page 7: Knowledge management in SMEs: a literature review

about knowledge management in SMEs and to which KM areas the body of knowledge is

limited.

Sixth, the final stage of the review process was devoted to writing up the findings.

4. Presentation of findings

4.1 What we know about knowledge management perception

Knowledge management perception represents a KM topic of higher interest; a summary of

the literature in this area is in Table I. This is not surprising as the perception of the merits of

knowledge management will influence any implementation activities. The data material

given indicates that knowledge management is a topic of relevance to all types of firms. Yet,

due to resource constraints SMEs face, the actual design of knowledge management

among them is completely different from what is found in larger resource-rich companies.

The table clearly shows that after McAdam and Reid’s (2001) paper it took some time until

more research on knowledge management perception emerged. From 2005 there seemed

to be an increasing interest in the topic. Yet this interest appears to have ended in 2008.

Possibly scholars active in the field of KM in SMEs have recognized that there are not

enough opportunities to position this type of research in high-ranked journals. Given the

publication pressure many scholars are facing they may have turned to other more

‘‘promising’’ research fields.

The majority of studies reviewed signify that knowledge management is perceived positively

among SMEs. The study by Bozbura (2007) who analyzed knowledge management

practices in Turkish SMEs is, however, an exception. The results show that Turkish SMEs are

rather sceptical regarding knowledge sharing, regardless of whether it addresses the

external or the internal business environment. Knowledge sharing seems to be viewed more

as a threat than an advantage the individuals concerned could benefit from.

Pillania (2008a), who studied the strategic component of knowledge management in SMEs

from India, demonstrated an emphasis on customer-focused knowledge among Indian

automotive component manufacturers, underlying the close links between SMEs and their

customers as is often found with this category of firms (e.g. Mugler, 1998; Malinen and

Stenholm, 2002). Concerning SMEs‘ strategic approaches Phillina stressed that Indian

SMEs need to incorporate the benefits of KM more strongly in order to secure their

sustainable competitiveness.

Questionnaires and semi-structured interviews dominate the research field. Few authors

(e.g. McAdam and Reid, 2001; Salojarvi et al., 2005) used a mix of methods. Sources of

information were primarily professionals, technical staff, owners and managers of studied

organizations. In terms of the countries studied, a relatively broad mix can be found,

e.g. Turkey, Iran, India, Lithuania, Finland and Scotland.

4.2 What we know about knowledge management implementation

The subject of knowledge management implementation is another KM topic relatively widely

examined (Table II). The findings illustrate that the SMEs reviewed use different ways to

handle the aspect of knowledge management implementation. This raises the issue of

heterogeneity (Curran and Blackburn, 2001) which must be taken into consideration when

researching and discussing SMEs. Keeping this in mind eliminates the likelihood of a

general knowledge management implementation approach in SMEs.

‘‘ Existing empirical literature provides only fragmentedinsights into KM in SMEs. ’’

PAGE 884 j JOURNAL OF KNOWLEDGE MANAGEMENTj VOL. 16 NO. 6 2012

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Page 8: Knowledge management in SMEs: a literature review

Table

ILiterature

onknowledgemanagementperception

Auth

or(

s)Year

Rese

arc

haim

/ob

jectiv

es

Theore

ticalp

ers

pectiv

e/f

ram

ew

ork

Meth

od

(em

piric

al/t

heore

tical)

Main

find

ing

s

McAdam

and

Reid

2001

Aim

edatcomparingperceptio

ns

ofKM

inboth

SMEsandlarge

organisatio

ns

Dim

ensionsofKM

Rese

archsu

rvey(resp

onse

sfrom

49SMEs,

46largeorganisatio

ns

andeightqualitativeworksh

ops)

invo

lvingamixture

ofSMEsand

largefirms,

and

facilitators/rese

archers

TheSMEse

ctorappearedto

beless

adva

ncedin

theKM

area,havingamore

mechanistic

approachto

knowledge

constructio

nandrelyingless

onso

cial

interactio

n

Egbu,Hariand

Renuka

ppa

2005

Inve

stigatedtheim

portanceof

knowledgeamongke

yemploye

es

inorganisatio

ns,

ofkn

owledge

with

inorganisatio

ns,andtheroleof

customercapita

landkn

owledge,

andtheim

pactofthese

issu

eson

thesu

stainable

competitive

adva

ntageofSMEs

Lite

rature

onKM

inSMEs

Pilotstudyinvo

lving12

profess

ionals

from

11constructio

norganisatio

nsin

Glasg

ow,base

donse

mi-structuredinterviews

Highlig

hts

therole

ofstrategies,

tools

and

techniqueswhichmightbeofassistance

Keogh,Mulvie

andCooper

2005

Aim

edatstudyingso

ftware-related

companies

N/a

Seriesofse

mi-structured

interviewswith

20company

owners/directors

Anumberoffactors

hinderthedeve

lopment

ofmanagerialtalentin

thesa

mple:sm

all

size

,lackofreso

urces,

ava

ilability

of

personnelneededto

undertake

deve

lopmentprogrammes,

andsh

ortageof

specialistHRM

exp

ertise

Salojarvi,Furu

andSve

iby

2005

Exa

minedtherelatio

nsh

ipbetween

sustainable

salesgrowth

andKM

activities

Lite

rature

onKM

andSMEs,

and

SMEgrowth

Combinatio

nofstandardized

questionnairefrom

108Finnish

SMEsandse

mi-structured

interviewswith

tenoutofthe108

companies

Higherleve

lsofKM

maturity

were

foundto

correlate

positively

with

long-term

sustainable

growth

Nunes,

Annansingh,

Eaglestoneand

Wake

field

2006

TobetterunderstandcurrentKM

awareness

,perceptio

nsand

requirements

inSMEs

Lite

rature

relatedto

KM

ingeneral

Interpretivistapproach,

invo

lvementoftwokn

owledge

intensive

SMEs,

interviewswith

CEOs,

operatio

nalmanagers

and

technicalstaff

KM

inSMEstendsto

happenin

aninform

al

way,rarely

supportedbypurpose

lydesignedICTsy

stems

(contin

ued)

VOL. 16 NO. 6 2012 j JOURNAL OF KNOWLEDGE MANAGEMENTj PAGE 885

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Page 9: Knowledge management in SMEs: a literature review

Table

I

Auth

or(

s)Year

Rese

arc

haim

/ob

jectiv

es

Theore

ticalp

ers

pectiv

e/f

ram

ew

ork

Meth

od

(em

piric

al/t

heore

tical)

Main

find

ing

s

Bozb

ura

2007

Aim

edatexa

miningse

nior

managers’perceptio

nsaboutthe

extentto

whichKM

components

contribute

tothesu

ccess

ofSMEs

inTu

rkey

Lite

rature

relatedto

KM

todeve

lop

aframework

tobetested

Surveyapproach,questionnaire

sentto

150SMEs(76usa

ble

resp

onse

sreceived)

TurkishSMEsdonotliketo

share

knowledge

eve

nwith

inthecompany.Themanagers

are

afraid

oflosingcontrolofthekn

owledge.

Sincethemanagers

close

theinform

atio

nchannels,incomingkn

owledgeis

limite

das

well

Jafari,Fathian,

Akh

ava

nand

Hosn

avi

2007

Exp

loredKM

andlearningfeatures

inIraniansm

allandmedium-sized

enterprise

s

Lite

rature

onKM

inSMEs

Structuredsu

rvey,questionnaires

sentto

26IranianSMEs(senior

managers,departmentmanagers

andpersonnelinvo

lvedin

decision-m

aking),136resp

onse

sreceived

There

isnorelatio

nsh

ipbetween

organizatio

nalsize

andtheneedforKM.

Most

SMEsin

Iranare

stilltraditional.Their

schoolofthoughtbelongsto

theindustrial

ageandtheireffortsare

notalig

nedto

the

knowledgeera’srequirements

Radze

vicience

2008

Analyse

dtherole

ofKM

inSMEsin

Lith

uania

bylookinginto

ITand

knowledgeso

urces

Lite

rature

relatedto

innova

tionand

competitiveness

Questionnaires,

42SMEsin

Lith

uania

(Email,phone,anddirect

interviewing)

Companiesin

thestudyare

aware

ofKM,its

process

esandadva

ntages,

butapplicatio

nis

rare

Pillania

2008a

Studiedstrategic

issu

esin

KM

inSMEsin

India,with

particular

referenceto

theautomotive

componentse

ctor

Lite

rature

onKM

strategyandthe

role

oftopmanagement

Surveyapproach,three

questionnairesaddress

ing30

internatio

nalexp

erts,

30Indian

exp

ertsand36automotive

componentmanufacturers

(ACMs)

KM

strategyis

neith

erwelldefin

ednor

alig

nedwith

theove

rallfirm

strategyin

the

majority

ofthefirmsunderstudy.To

pmanagementis

more

activeandsu

pportive

inKM

initiativesin

internatio

nalACMs

PAGE 886 j JOURNAL OF KNOWLEDGE MANAGEMENTj VOL. 16 NO. 6 2012

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Table

IILiterature

onknowledgemanagementim

plementation

Auth

or(

s)Year

Rese

arc

haim

/ob

jectiv

es

Theore

ticalp

ers

pectiv

e/f

ram

ew

ork

Meth

od

(em

piric

al/t

heore

tical)

Main

find

ing

s

Shelto

n2001

Discuss

edhow

theowner

managerofasm

allcompany

introducedtheideaofKM

tothe

firm

Lite

rature

relatedto

KM

(ingeneral

andin

SMEs)

Base

dontheprinciplesofactio

nrese

arch.Single

case

study,

ove

rallperiodofstudy:

January

1998to

July

1999,unstructured

andse

mi-structuredinterviews

with

managers

andstaff

Indicatedhow

tomake

betteruse

of

employe

es’

exp

ertise.Draws

conclusionsforthefacilitator/helperrole

inSMEs

Wongand

Asp

inwall

2005

Inve

stigatedcritic

alsu

ccess

factors

foradoptin

gKM

inSMEs

Lite

rature

relatedto

critic

al

success

factors

(CSFs)

Postalsu

rvey,questionnairesse

nt

to300SMEsin

theUKand100

contributors

(i.e.academics,

consu

ltants

andpractitioners

inthe

KM

field).Resp

onse

sreceived

from

72SMEsand18contributors.

Deve

lopedaprioritisedlistofCSFs;

ranking:

1.Managementleadership

andsu

pport

2.Cultu

re3.Strategyandpurpose

Sparrow

2005

Exa

minedtheexistenceofd

ifferent

approachestowardsKM

deve

lopmentin

SMEs.

Lite

rature

onKM

inSMEs

Surveyamong33firmsin

theUK

(West

Midlands),clusteranalysis

Fourdistin

ctconfig

uratio

nsofpractic

es

were

identified.These

were

theKM

practic

esof‘‘u

nengaged’’business

es,

‘‘comprehensive

KM

practic

e’’

business

es,

‘‘knowledgeownership

oriented’’business

esand‘‘learningand

co-productio

noriented’’business

es

Deso

uza

and

Awazu

2006

Discuss

edfiv

epeculiaritie

sabout

KM

practic

esatSMEs

N/A

Semi-structuredinterviewswith

owners

andmanagers

of25SMEs

SMEsdomanagekn

owledgedifferently

comparedto

largerbusiness

es.

SMEs

have

totake

theirreso

urceconstraints

into

consideratio

nandfin

dcreativeways

aroundthese

limita

tions

Merono-C

erdan,

Lopez-Nicolasand

Sabater-Sanchez

2007

Measu

redKM

implementatio

nand

determ

inedKM

strategy

Review

ofKM

instruments

andKM

strategies

Data

collectedfrom

Austrianand

SpanishSMEs(teneach)

Show

theappropriateness

ofusing

instruments

fortheanalysisofKM

strategies;

somefirm

characteristics,

i.e.industry,natio

nalcultu

re,size

and

ageactascontin

gentfactors.

Personalisatio

nstrategyispredominant

MassaandTe

sta

2009

Prese

ntedthreecase

studies

demonstratin

ghow

ItalianSMEs

apply

differentstrategic

optio

ns

Reso

urce-base

dtheory,Milesand

Snow’sstrategic

types

Semi-structuredinterviews,

fieldwork

inthreeItalianfirms

Highlig

htthedifferencesregarding

human,relatio

nalandstructuralcapita

lconcerningthreestrategies(defender,

analyse

randprosp

ectors)

FinkandPloder

2009a

Identificatio

nofmethodsandtools

supportingKM

inSMEs

Lite

rature

onkn

owledgeprocess

models

Exp

ertinterviewswith

36CIO

sand

CEOs

SMEsin

Austria,Switzerlandand

Liechtenstein

are

satisfie

dwith

four

knowledgeprocesses:

knowledge

identificatio

n;kn

owledgeacquisition;

knowledgedistributio

nandkn

owledge

prese

rvatio

n.Prese

ntabalanced

system

fortechnicalandso

cial

knowledgeapplicatio

n–TSSTModel

FinkandPloder

2009b

IdentifiedSMEs’

needsregarding

KM

toolkits

Lite

rature

onKM

andSMEs

Onlinequestionnaireamong219

SMEsin

Germ

ansp

eaking

countries;40percentresp

onse

rate

Sim

ilarfin

dingsasin

theotherpaper

(2009a)

VOL. 16 NO. 6 2012 j JOURNAL OF KNOWLEDGE MANAGEMENTj PAGE 887

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Page 11: Knowledge management in SMEs: a literature review

The year 2005 seemed to represent the starting point for more intensive research into the

topic of knowledgemanagement implementation. An emphasis on structured interviews as a

method is perceptible; with the exception of Shelton (2001) who based his study on an action

research approach. Again, the main source of information stems from managers and

specialists, with only one study (Shelton, 2001) relying on contributions from staff members.

In terms of the countries the focus is onWestern Europe, i.e. the UK, Germany, Spain, Austria

and Italy.

Furthermore, three articles were identified that refer to both knowledge management

perception and knowledge management implementation (Table III).

The papers imply that SMEs are involved in KM activities, yet in order to better understand

and discuss these activities, researchers in the field may consider the application of a more

target group oriented language. This means that scholars should try to discuss KM with a

stronger reference to SME specific needs rather than from a prescriptive point of view.

Regarding the benefits of KM, Edvardsson’s (2009) study stressed the direct link between

KM activities and increased productivity and/or new product development.

4.3 What we know about knowledge identification

Concerning this topic only one paper was identified (Table IV). This is surprising, against the

background that in order to effectively manage company knowledge one needs to

understand what types of knowledge are provided and their respective relevance to the firm.

To turn the argument on its head, the paucity of sources would appear to indicate that the

focus of knowledge management should be limited to very specific knowledge.

The paper by Durst and Wilhelm (2011) was based on a research design involving only one

German firm. The findings are thus limited in terms of their transferability, yet the paper

addresses the relevant issue of making a distinction between specific knowledge which is

difficult to imitate or rare within the firm and knowledge that is easily accessible or

reproducible. In terms of the informants involved almost all were either members of the

management board or of the second level of management.

4.4 What we know about knowledge creation/acquisition

The topic of knowledge creation and/or acquisition refers to ways, which focus on the

construction of new knowledge. This new knowledge can be generated internally or

acquired from outside the firm. Due to their natural limitations, SMEs are particularly forced

to use external knowledge creation sources (Egbu et al., 2005). The findings underline the

meaning of learning within this process (Table V). Yet, Cegarra-Navarro and Dewhurst (2006)

draw particular attention to a firm’s ability of unlearning as critical precondition to new

knowledge.

This topic seems to be of ongoing interest among scholars. With regard to the methods,

questionnaires appear to be viewed as most suitable.

Another article was identified (Table VI) that covers the processes of knowledge creation,

knowledge transfer and knowledge utilisation. In the context of the implementation of an

e-business system, the authors stress that the three processes need to be addressed

holistically rather than separately.

4.5 What we know about knowledge storage/retention

The topic of knowledge storage/retention seems to be neglected in the field of KM in SMEs

confirming Hislop’s (2009) findings regarding KM in general. The literature search resulted in

only one article linked to the topic (Table VII). Even though the article by Durst and

Gueldenberg (2010) did not have a primary focus on knowledge management and

knowledge storage/retention, respectively, their study underlines the particular meaning of

knowledge retention in terms of keeping highly skilled individuals in the case of managerial

succession, thus highlighting the danger of knowledge attrition caused by this event.

PAGE 888 j JOURNAL OF KNOWLEDGE MANAGEMENTj VOL. 16 NO. 6 2012

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Page 12: Knowledge management in SMEs: a literature review

Table

IIILiterature

onknowledgemanagementperceptionandim

plementation

Auth

or(

s)Year

Rese

arc

haim

/ob

jectiv

es

Theore

ticalp

ers

pectiv

e/f

ram

ew

ork

Meth

od

(em

piric

al/t

heore

tical)

Main

find

ing

s

Edva

rdss

on

2006

Deve

lopmentofkn

owledgeonKM

inSMEs(focusingonIcelandic

SMEs)

Lite

rature

relatedto

KM

inSMEs

Questionnairese

ntto

Chief

Exe

cutivesofIcelandic

SMEs,

265

Icelandic

firmsreve

alan

unsy

stematic

approachofsh

aring

andutilisingkn

owledge;few

have

aKM

strategy;

use

ofunso

phistic

ated

ICTtechnologies

Hutchinso

nand

Quintas

2008

Addressedtheissu

esofKM

inSMEs

andthedistin

ctio

nbetweenform

al

andinform

alKM

process

es

Lite

rature

relatedto

competitive

adva

ntageandKM

In-depth,se

mi-structuredinterviews

with

owner-managers/m

anaging

directors

of13SMEs

KM

managementis

nottheprese

rve

oflargebusiness

es.

SMEsdo

inform

alKM,butoftenin

structured

anddelib

erate

ways

.SomeSMEsdo

form

alK

M.C

oncepts

andvo

cabulary

ofKM

are

startingto

filterinto

SME

usa

ge

Edva

rdss

on

2009

Exa

minedwhetherthepopularity

of

KM

inSMEsin

Icelandhas

decrease

dordeclinedsince2004

Lite

rature

relatedto

KM

inSMEs

Questionnairese

ntto

Chief

Exe

cutivesofIcelandic

SMEs(2007),

repetitionofaprevioussu

rvey

(2004),

224

KM

isnotlosinggroundamongSMEs

inIcelandin

2004-2007.Manymore

firmshave

noKM

strategycompared

to2004

VOL. 16 NO. 6 2012 j JOURNAL OF KNOWLEDGE MANAGEMENTj PAGE 889

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Page 13: Knowledge management in SMEs: a literature review

Table

IVLiterature

onknowledgeidentification

Auth

or(

s)Year

Rese

arc

haim

/ob

jectiv

es

Theore

ticalp

ers

pectiv

e/f

ram

ew

ork

Meth

od

(em

piric

al/t

heore

tical)

Main

find

ing

s

Durstand

Wilhelm

2011

Exa

minedhow

amedium-sized

enterprise

characterise

dbyslow

turnove

ridentifiesandmanagesits

critic

alkn

owledge

Lite

rature

relatedto

KM

inSMEsand

knowledgeloss

Qualitativeapproach,ase

riesof

in-depth

interviewswith

seve

norganizatio

nmembers

Firm

members

are

aware

ofthe

potentia

ldangerofkn

owledge

attritio

n,ye

tcertain

constraints

(missingtim

e,organizatio

nalstructure

etc)apparently

hamperthem

from

changingthis

situatio

n

PAGE 890 j JOURNAL OF KNOWLEDGE MANAGEMENTj VOL. 16 NO. 6 2012

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Page 14: Knowledge management in SMEs: a literature review

Table

VLiterature

onknowledgecreation/acquisition

Auth

or(

s)Year

Rese

arc

haim

/ob

jectiv

es

Theore

ticalp

ers

pectiv

e/f

ram

ew

ork

Meth

od

(em

piric

al/t

heore

tical)

Main

find

ing

s

Hari,EgbuandKumar

2005

Focuse

donkn

owledgecapture

inSMEsin

theconstructio

nindustry

Lite

rature

ontacitandexp

licit

knowledge

Semi-structuredinterviewswith

51

profess

ionals

from

26different

constructio

nfirms

Lackofawareness

ofcomplex

issu

esassociatedwith

aneffective

knowledgecapture

process

Cegarra-N

ava

rroand

Dewhurst

2006

Exa

minedtherelativeim

portanceof

sharedorganisatio

nalcontext

on

unlearningandits

effectonthe

creatio

nofIC

Lite

rature

relatedto

unlearning,

sharedorganisatio

nalcontext

and

IC

Postalquestionnairesu

rveyto

inve

stigate

139SMEsin

the

Spanishoptometryse

ctor

Companiesneedto

support

unlearningasapriorstep,

otherw

iseunlearningdoesnothave

anysignificante

ffecto

nthecreatio

nofIC

Ambrosiniand

Bowman

2008

Analyse

dhow

causa

lmappingcan

help

tosu

rfacetacitkn

owledgein

akn

owledge-intensive

firm

Reso

urce-base

dtheory,theories

relatedto

tacitkn

owledge

Qualitativecase

studyin

one

company.Causa

lmapping

Thefirm

benefitedfrom

the

engagement;demonstrate

how

causa

lmappingcanbeause

ful

toolforcapturingkn

owledge

Pillania

2008b

Studiedkn

owledgecreatio

nand

categoriza

tionin

IndianSMEsin

the

automotivecomponents

sector

Lite

rature

onkn

owledge

categoriza

tionandkn

owledge

creatio

n

Surveyamong30internatio

nal

exp

erts,

30Indianexp

erts,

and48

auto

componentmanufacturers

inIndia

Theim

portanceofnew

knowledge

isackn

owledged.Indianand

internatio

nalautomotive

components

manufacturers

paid

little

attentio

nto

knowledge

ava

ilable

throughgove

rnment

institu

tionsandindustry

ass

ociatio

ns.

Thefirmsinve

stlittle

inR&D

SoonandZainol

2011

Exa

minedtheim

portanceofthe

knowledgecreatio

nprocess,by

lookinginto

KM

enablers

suchas

learningandT-sh

apedsk

ills

Lite

rature

relatedto

KM,learning

andinnova

tion

Questionnaire;110resp

onse

s(10.24percent);regression

analysis;

Malays

ia

LearningandT-sh

apedsk

illsare

positively

relatedto

thekn

owledge

creatio

nprocess;theycontribute

toorganizatio

nalcreativity

and

perform

ance

VOL. 16 NO. 6 2012 j JOURNAL OF KNOWLEDGE MANAGEMENTj PAGE 891

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Page 15: Knowledge management in SMEs: a literature review

Table

VILiterature

onknowledgecreation/acquisition,transferandutilisation

Auth

or(

s)Year

Rese

arc

haim

/ob

jectiv

es

Theore

ticalp

ers

pectiv

e/f

ram

ew

ork

Meth

od

(em

piric

al/t

heore

tical)

Main

find

ing

s

Cegarra-N

ava

rroand

Martınez-Conesa

2007

Aim

edatdesc

ribingamodelthat

exa

mineshow

KM

influ

encesthe

adoptio

nofe-business

,particularlyin

SMEs

Lite

rature

onKM

phase

s(knowledgeacquisition,

knowledgesh

aringand

knowledgeapplicatio

n)and

e-business

Survey,107SMEsin

theSpanish

telecommunicatio

nsse

ctor

Toim

plemente-business

systems,

companiesneedto

provideand

supportkn

owledgeacquisition,

sharing,andapplicatio

nasprior

steps

PAGE 892 j JOURNAL OF KNOWLEDGE MANAGEMENTj VOL. 16 NO. 6 2012

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Page 16: Knowledge management in SMEs: a literature review

Table

VII

Literature

onknowledgestorage/retention

Auth

or(

s)Year

Rese

arc

haim

/ob

jectiv

es

Theore

tical

pers

pectiv

e/f

ram

ew

ork

Meth

od

(em

piric

al/t

heore

tical)

Main

find

ing

s

Durstand

Gueldenberg

2010

Exp

loredthose

intangible

ass

ets

that

are

regardedasattractivefrom

the

viewpoints

ofexternalsu

ccess

ors

Lite

rature

oncompany

success

ionandIC

Mixedmethodsapproach:online

questionnaireandin

depth

interviews

Intangible

ass

ets

playanim

portant

role

inexternalsu

ccess

ors’

decision-m

aking.In

particular,fiv

efactors

are

crucial;ke

yemploye

es,

knowledgeretentio

n,brand,partners,

andto

aless

erdegreecorporate

cultu

re

VOL. 16 NO. 6 2012 j JOURNAL OF KNOWLEDGE MANAGEMENTj PAGE 893

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Page 17: Knowledge management in SMEs: a literature review

This study was based on a mixed methods approach which allowed the authors to bring in

different perspectives.

4.6 What we know about knowledge transfer

Compared to the previous topic, the aspect of knowledge transfer has gathered some

research attention (Table VIII). The findings underline the critical relevance of this KM

process in terms of SME business operations and thus competitiveness.

Taking the nature of knowledge transfer into consideration, the research methods used

reveal a stronger emphasis on qualitative approaches. The topic appears to be of high

interest in the UK.

4.7 What we know about utilisation

Research on knowledge utilisation seems to be neglected (Table IX). This should be

regarded as unsatisfactory as only this process generates value within the firm. Knowledge

not used is thus lost knowledge. Both articles confirm the role of knowledge as a driver of

innovation, enhancing customer satisfaction as well as escalating profits and productivity.

These researches were based on a survey approach.

5. Discussion – what we do not know about knowledge management in small andmedium-sized enterprises

Based on the discussion above, it may be concluded that an initial understanding of

knowledge management in SMEs has been developed. The evidence provided above,

however, also reveals that this understanding is rather fragmented.

5.1 Knowledge management perception and knowledge management implementation

Both topics are highly researched, compared to the other issues analyzed. Yet what seems

missing is a distinction between the different types of SMEs, namely micro, small and

medium-sized enterprises. So far, both issues have been discussed from an overall SME

perspective; this approach, however is risky considering the heterogeneity found among

those firms (Curran and Blackburn, 2001). Thus future research should better incorporate

this aspect. Additionally, what sticks out is the lack of cross-country studies and the

prevalence of mono-country approaches instead. However, as there are different

country/region approaches to knowledge management (Takeuchi, 2001) those might be

useful to better understand how SMEs from different countries/regions of the world tackle the

challenges of KM.

5.2 Knowledge identification

Knowing what type of knowledge is provided in the firm and what type of knowledge is

needed to tackle present and future business challenges is vital. So the lack of research

activities in this area is surprising. Thus, the area of knowledge identification offers scholars

a variety of research avenues. For example, what actions are taken in SMEs to identify

existing knowledge? How do they determine knowledge needed to remain competitive? The

process used to distinguish between relevant and less relevant knowledge might be another

promising field of research.

5.3 Knowledge creation

The process of knowledge creation/acquisition is closely linked to learning. To learn

something new an organization, that is to say, its members, must possess the ability of

unlearning. The ways SMEs use to foster unlearning might be a useful field of intense

research. Here country-comparisons would be suitable as well. Due to resource constraints

SMEs need to identify external knowledge sources. How do SMEs proceed in this context?

How do SMEs identify suitable external knowledge sources?

In terms of methods, qualitative approaches should be used in prospective studies, since

the focus is on understanding.

PAGE 894 j JOURNAL OF KNOWLEDGE MANAGEMENTj VOL. 16 NO. 6 2012

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Table

VIIILiterature

onknowledgetransfer

Auth

or(

s)Year

Rese

arc

haim

/ob

jectiv

es

Theore

ticalp

ers

pectiv

e/f

ram

ew

ork

Meth

od

(em

piric

al/t

heore

tical)

Main

find

ing

s

Levy,Loebbecke

andPowell

2003

Analyse

dtherole

ofIS/ITin

the

context

ofco-opetition;use

ofa

game-theoretic

modelto

identify

theeffects

ofkn

owledgesh

aring

Lite

rature

onKM

inSMEsand

gametheory

Case

studies,

data

from

37UK

SMES

SMEswith

acost-focuse

dstrategyare

likely

tohave

weaksy

nergyandleve

rage,and

henceanambiguousattitu

deto

knowledge

sharing.Forva

lue-addedSMEs,

the

analysissu

pportsthepropositio

nthatthose

inthecollaboratio

nquadrantexh

ibitstrong

synergyandweakleve

rage,while

repositio

ningSMEsexh

ibitboth

strong

synergyandleve

rage

Chen,Duan,

Edwardsand

Lehaney

2006

Exa

minedSMEs’

needsand

practic

esregarding

inter-organizatio

nalkn

owledge

transfer

Lite

rature

onKM

inSMEs

Postalquestionnaire,105

resp

onse

sfrom

UKSMEsin

the

servicese

ctor

Studyconfirmsthegeneralbeliefthat

externalkn

owledgeis

ofprimeim

portance

toSMEs,

anddemonstratesthatSMEshave

very

strongneedsforexternalkn

owledge

andinter-organizatio

nalkn

owledge

transfer

Perez-Araos,

Barber,

Munive-H

ernandez

andEldridge

2007

Prese

ntedaKM

toolwhichhas

beendesignedto

supportthe

creatio

nofvirtualkn

owledge

sharingnetworks(KSNs)

Review

ofKM

literature

Onlinesu

rvey,resp

onse

sfrom

24

manufacturingSMEsin

the

Northwest

oftheUK

TheKM

toolsu

pportsthecreatio

nofKSNs

throughanexp

licitKM

approachto

share

ideas,

exp

eriencesandkn

owledgerelatin

gto

theim

plementatio

nofbest

practic

esand

improve

menttools;helpingSMEsto

becomemore

competitive

Harris

2008

Reportedthedeve

lopmentofa

knowledgetransferproject

designedto

encourageinnova

tion

andto

improve

thecapability

of

SMEsin

theWest

Midlandsregion

oftheUK

N/A

Actio

nrese

archmethodology;12

university

anduniversity

college

partners

andSMEsin

theWest

Midlandsregion

Firmsthatefficiently

tapinto

allreleva

nt

sourcesofkn

owledgeare

likely

tothrive

,whilstthose

thatcannotmaystruggle

Chirico

2008

Exa

minedhow

knowledgecanbe

accumulatedin

family

business

es

toincrease

theirsu

rvivalrate

Lite

rature

onfamily

business

es

andsu

ccession

Fourcase

studies(m

ixed

methods)

inSwitzerlandandItaly

Thefamily

firmsuse

dva

riousmeansto

transferkn

owledgebetweengeneratio

ns:

Trust

betweenfamily

members,commitm

ent

tothefamily

business

,andse

eking

exp

eriencefrom

outsidethroughtrainingor

working

Fletcherand

Prash

antham

2011

Exp

loredthekn

owledge

assim

ilatio

nprocess

use

dby

rapidly

internatio

nalisingSMEs

Concepto

fknowledgeassim

ilatio

nandrelatedasp

ects

ofform

ality

exp

loredin

thecontext

ofrapidly

internatio

nalisingSMEs

Qualitative,longitu

dinalenquiry

conductedin

twostages:

1st

stage:fourlongitu

dinalcase

studies(threeye

ars),and2nd

stage:twofocusgroups

Knowledgesh

aringis

importantforrapidly

internatio

nalisingSMEs;

thefirmsinvo

lved

adoptedhighleve

lsofform

alityin

assim

ilatin

gkn

owledge

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Table

IXLiterature

onknowledgeutilisation

Auth

or(

s)Year

Rese

arc

haim

/ob

jectiv

es

Theore

ticalp

ers

pectiv

e/fra

mew

ork

Meth

od

(em

piric

al/t

heore

tical)

Main

find

ing

s

Gray

2006

Exp

loredSMEs’

capacity

toabso

rbandmanagekn

owledgeasaprior

conditionto

thesu

ccess

fuladoptio

nofinnova

tionsandentrepreneurial

growth

Abso

rptivecapacity

theory

Findingsfrom

natio

nalUKquarterly

surveys

(2003-2005)

Underlinetherole

oftheowners’

strategic

objectives,

andthe

conse

quentcultu

recreatedwith

inthesm

allfirm

regardingtheissu

es

infocus

Alegre,Sengupta

and

Lapiedra

2011

Exa

minedhow

KM

affects

innova

tionwith

inbiotechnology

firms

Knowledge-base

dtheory

ofthe

firm,dyn

amic

capabilitie

sSurveyamong132biotechnology

firmsin

France,se

ntto

R&D

directors

There

isapositiverelatio

nsh

ipbetweenKM

practic

eand

innova

tionthatis

strengthenedby

themediatin

geffectofKM

dyn

amic

capabilitie

s.Nosignificant

relatio

nsh

ipbetweeninnova

tionand

size

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Page 20: Knowledge management in SMEs: a literature review

5.4 Knowledge retention/storage

Although issues of not only creating and/or acquiring knowledge, but also retaining

knowledge are important, the review suggests that research on KM in SMEs does not yet

address aspects of knowledge retention. With the exemption of the study by Durst and

Gueldenberg (2010), the authors did not identify any study that looked into factors

influencing knowledge retention in small firms. The same was true for knowledge storage in

SMEs. What drives managers of SMEs regarding the issue of knowledge retention and

knowledge storage, respectively? What fosters or conversely hampers activities related to

knowledge retention?

With regard to the critical role of knowledge in terms of firms’ competitiveness, more

research is needed which emphasises the development and implementation of knowledge

retention measures in SMEs.

5.5 Knowledge transfer

Concerning knowledge transfer more research is needed addressing both sides of the

process: the sender and the receiver. So far the discussion is rather one-sided. To

understand this important KM process better, future research should incorporate both

perspectives more strongly. This lends itself to qualitative research approaches.

5.6 Knowledge utilisation

New knowledge, whether developed internally or acquired from outside the firm, needs to be

utilised. The outcome might be new products, higher productivity, or more innovative

activities (Edvardsson, 2009). Thus, this process is more or less the central aspect of all KM

activities. So far research in this area seems to be neglected, however, which can be ranked

as unsatisfactory, considering the aspect’s specific relevance. Consequently, more intensive

research in this area is needed. How is new knowledge utilised in SMEs? Are there any

differences in terms of country of origin? What hampers/fosters the utilisation of (new)

knowledge?

5.7 Additional observations

5.7.1 Scope and context of knowledge management research. The topic of knowledge

management is originally an Anglo-American discipline, with some Japanese influence

(Nonaka and Takeuchi, 1995). The articles reviewed demonstrate that KM research in SMEs

has spread throughout the world. Although Western countries dominate the scene

(especially the UK), there are some studies from other parts of the world, e.g. India, Iran and

Malaysia. No empirical studies from China and Africa were, however, involved. Given the

relevance of SMEs on an international level (Greene and Mole, 2006), research in the area of

KM would definitely benefit from contributions from these parts of the world. In addition, it is

clear from the literature review that the papers reviewed consist of single-region or

single-country studies. Cross-country comparisons were not identified. The authors believe

that comparative research activities are urgently needed as this would provide an

opportunity to discuss and understand how culture, religion and gender relations affect KM

in SMEs, especially trust and knowledge sharing.

Concerning the industrial aspect, the literature review suggests a stronger use of

multi-industry approaches. This apparently takes into account the severe obstacles SME

researchers face when trying to gain access to this category of firms (Curran and Blackburn,

2001).

5.7.2 Perspective used to study knowledge management in SMEs. The studies reveal a

normative or prescriptive approach when discussing knowledge management in SMEs. It

would appear that many researchers in this field, consciously or unconsciously, compare KM

activities in large firms with those found in smaller firms, on the assumption that these firms

are comparable. This approach is dangerous as SMEs are not ‘‘merely a scaled-down

version of a large business’’ (Curran and Blackburn, 2001, p. 5). The work of Hutchinson and

Quintas (2008) represents an exception, highlighting that in order to understand KM

VOL. 16 NO. 6 2012 j JOURNAL OF KNOWLEDGE MANAGEMENTj PAGE 897

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Page 21: Knowledge management in SMEs: a literature review

practice in SMEs researchers need a different approach. Consequently, more research is

needed towards putting a stronger emphasis on what is given in SMEs rather than what

should be given. This may help to reduce the gap between theory and practice.

Table X provides a summary of the analysis conducted.

6. Conclusions

This paper has reviewed existing empirical papers on knowledgemanagement in SMEs. In a

knowledge-driven economy the effective management of information is one of the main

challenges faced by SMEs. Yet, often founders or managers of SMEs are captured by

day-to-day business operations (Hofer and Charan, 1984) and thus prevented from actually

tackling this challenge. Prior research in the field of knowledge management has tended to

emphasise large firms. Assuming that SMEs are the drivers of most nations all over the

world, this situation is unsatisfactory.

The reviews conducted reveal that the body of knowledge regarding knowledge

management in SMEs is still limited. The analysis of papers has shown that three areas of

KM seem to be relatively well researched in SMEs. These are KM implementation, KM

perception, and knowledge transfer. Yet, the body of knowledge regarding the topics of

knowledge identification, knowledge storage/retention, and knowledge utilisation is rather

poor.

It can be thus concluded that the existing empirical literature provides only fragmented

insights into KM in SMEs. Given the importance of knowledge to company studies, the field

of knowledge management in small businesses is highly important. The present study

clearly underlines that the topic still calls for more research, which in turn offers scholars a

variety of research avenues.

The review of extant empirical studies has brought about a number of possible research

directions (Table X). The authors call for intensive research activities specifically in the three

neglected KM areas outlined above; as only this would enable a holistic understanding of KM

in SMEs. In addition to the research directions proposed in Table X, the following research

questions/areas might be of interest. Regarding knowledge identification: Do SMEs use any

KM tools, e.g. knowledge maps, in the process of knowledge identification? What type of

knowledge is of interest? What are the triggers that initiate knowledge identification activities?

Do SMEs mainly have an internal view when trying to identify existing firm knowledge or do

they refer to external partners as knowledge sources as well? Concerning knowledge

storage/retention a better understanding of the measures used by SMEs to reduce the danger

of knowledge attrition is needed. The aging workforce will soon lead to increasing voluntary

turnover that cannot be compensated for by the smaller number of succeeding

individuals/manpower. What can/should be done to handle this challenge in SMEs? How

can SMEs overcome a possible ‘‘knowing-doing gap’’ (Pfeffer and Sutton, 2000)? Even

though managers of SMEs are aware of possible negative implications of departing

organization members, it seems that they accept this probability and that they risk the

consequences as well (Durst and Wilhelm, 2011). Finally, with regard to knowledge utilisation,

future research may examine how knowledge, whether new or existing, is actually used in

SMEs. What are the effects of knowledge utilisation on SME performance/competitiveness?

Besides, the authors see four general areas that need more attention and development:

1. Longitudinal studies. Issues related to knowledge management require a long-term

focus. Cross-sectional studies are only able to capture this focus to a limited extent.

Longitudinal studies would enable researchers to study whether KM activities change

over time as firms grow older or face new challenges, respectively.

2. Country-comparison. More studies are needed that discuss KM in SMEs, taking country

differences into consideration, since it is only natural to assume that KM activities will vary

from country to country.

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Table

XSummary

ofempiricalstudiesonknowledgemanagementin

smallandmedium-sizedenterprises

Are

aQ

ualit

yof

rese

arc

hactiv

ities

Pro

mis

ing

rese

arc

hd

irectio

ns

KM

perceptio

nandKM

implementatio

nReprese

nttheareasofhighest

rese

arch

attentio

nto

date;SMEsare

activein

KM

Insights

into

differencesconcerningKM

perceptio

nandKM

implementatio

ndependingon

thetypeofSMEs(i.e.micro,sm

allandmedium-sizedenterprise

s)Knowledgeidentificatio

nUnder-rese

archedKM

area

Insights

into

approachespursuedregardingkn

owledgeidentificatio

nInsights

into

thetypeofkn

owledgeregardedasreleva

nt

Insights

into

ways

use

dto

determ

inethekn

owledgeneeded

Knowledgecreatio

nReprese

nts

anareaofongoingrese

arch

interest

Insights

into

unlearningactivitiesasameansto

new

knowledgegeneratio

nInsights

into

knowledgecreatio

nusingexternalkn

owledgeso

urces

Insights

into

capabilitie

sneededto

create/acquirekn

owledge

Knowledgeretentio

n/storage

Under-rese

archedKM

area

Insights

into

factors

thatfoster/hamperkn

owledgeretentio

n/storage

Insights

into

thedeve

lopmentandim

plementatio

nofmeasu

resrelatedto

knowledge

retentio

n/storage

Insights

into

meansuse

dto

codify

knowledge

Insights

into

handlingtacitkn

owledgein

thecontext

ofretentio

nKnowledgetransfer

Represe

nts

anareaofhigherrese

arch

attentio

n,sp

ecifically

intheUK

Insights

into

both

sidesofthekn

owledgetransferprocess;to

date

focusis

mainly

onthe

sender

Knowledgeutilisatio

nNeglectedareaofrese

arch

Insights

into

knowledgeutilisatio

nin

SMEs

Insights

into

factors

thatfoster/hamperkn

owledgeutilisatio

nin

SMEs

Insights

into

countrydifferencesregardingkn

owledgeutilisatio

nScopeandcontext

ofKM

rese

arch

Most

rese

archactivitieshave

been

conductedin

Western

countries

KM

studiesfrom

otherpartsoftheworld,e.g.ChinaandAfrica

Exe

cutio

nofcross

-countrystudies

Mono-industry

studies

Perspectiveuse

din

rese

arch

Studiesreve

ala

nemphasisonnorm

ativeor

presc

riptiveperspectives

StudiesconsideringSMEsp

ecificKM

issu

es/challenges

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Page 23: Knowledge management in SMEs: a literature review

3. Mixed methods approaches. This direction in research would help to obtain a more

holistic understanding of KM in SMEs than is possible using mono method approaches.

4. Realistic lens. Future research should take more strongly into account that SMEs are not

comparable with large listed firms. Consequently, research should disengage from

discussing KM in SMEs from a large firm perspective towards a more realistic approach

taking the resource constraints SMEs are facing and the environments in which they are

operating into consideration. Also, the heterogeneity between SMEs needs to be

considered as small firms are hardly comparable with medium-sized firms. The same

refers to different industries, which also show size variations, making the comparison of

industries more challenging.

The present study is not without limitations. By restricting itself to the ProQuest database this

study may not have allowed complete coverage of all empirical articles in the field of

knowledge management in SMEs. Yet, it seems reasonable to assume that the review

process covered a large proportion of the studies available. In addition, reviewing the

literature was sometimes disconcerting, as many papers do not specify whether they are

discussing SMEs or large firms. Finally, this paper proposes some research directions,

which are not exhaustive but represent initial stages.

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About the authors

Susanne Durst is Assistant Professor at the Chair in International Management, Institute forEntrepreneurship, at the University of Liechtenstein. Her research interests includeknowledge management, entrepreneurship, and corporate governance. Susanne Durst isthe corresponding author and can be contacted at: [email protected]

Ingi Runar Edvardsson is a Professor of Management at the University of Iceland. Hisresearch interests focus on the interplay between knowledge management and humanresource management, outsourcing as well as on regional innovation and learningstrategies.

VOL. 16 NO. 6 2012 j JOURNAL OF KNOWLEDGE MANAGEMENTj PAGE 903

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