Critical knowledge management factors and organizational performance: An investigation of Chinese hi-tech enterprises

Abstract

This study sets out to explore the critical factors of knowledge management (KM) that impact on the organizational performance of Chinese enterprises. It attempts to investigate the relationships among KM factors including KM strategy, KM enablers (Organizational culture, Organization structure, People, and Technology), KM processes, and organizational performance. The conceptual framework of knowledge management guiding this research is developed from prior research (Alavi, 1997; Davenport, 1999; Lam, 2000; Leonard-Barton, 1995; Nonaka and Takeuchi, 1995; Ramireza nd Dickenson, 2006; Zack, 1999). Previous KM research in the Chinese context has focused on the use of object-perspective measures such as number of created ideas or patents. There appears to be a relative neglect of the relationships between those KM factors. This research focused on exploring the relationships between those KM factors and investigating how they impact on organizational performance in the context of an emerging economy - China. This research adopted the mixed-methods (Creswell, 2003) methodological approach, which involved the use of qualitative and quantitative methods in addressing the research questions raised in this study.

The results of this research suggest that organizational culture variables are found to be essential for knowledge creation. In particular, trust is a significant predictor of all knowledge creation processes. The findings of this study confirm that enterprises will be able to obtain strategic benefits of KM through effective knowledge creation processes. The research findings also imply that companies should align their knowledge strategies along with knowledge creation processes. The key to understanding KM in the Chinese context is recognizing the networking nature of the Chinese society which operates on the basis of "Guanxi". In Chinese enterprises, the socialization and externalization elements are remarkably similar to the Japanese situation that Nonaka and Takeuchi (1995) described, as the Chinese are highly networked, hold tacit knowledge within these networks and are prepared to make this knowledge explicit only within the context of these pre-existing relationships.

The departmental focus of Chinese enterprises mean that the combination of tacit knowledge is not straightforward, while learning-by-doing is important to sustain their development. The research also indicates that internalization is also problematic in Chinese enterprises because of individuals' fear of admitting mistakes. The implication of the findings for knowledge management and research is discussed.