Product and process knowledge in the performance‐oriented knowledge management approach

Abstract

PurposeThe paper proposes first, to understand how and how much knowledge contributes toward explicit business performance improvement and, second, through the understanding of knowledge contribution, to provide a guiding principle for the effective knowledge management activities.Design/methodology/approachThe authors use a Cobb‐Douglas type production function to model the relationship between knowledge and performance. Then, regression analysis is used to estimate the knowledge elasticity of performance. Finally, a laboratory experiment is used to demonstrate the whole process.FindingsA performance‐oriented knowledge management approach was developed. Through the analysis of knowledge‐intensive production function, it is shown that the knowledge elasticity of performance for each knowledge entity (product knowledge and process knowledge) can be estimated and can be used with great managerial implications.Research limitations/implicationsExtensive empirical analyses in the real world business environment would be helpful to verify and generalize this approach.Practical implicationsThe paper demonstrates the specific process of how to measure the contribution of knowledge to performance, and provide a guiding principle for the effective knowledge management activities.Originality/valueAs far as the authors understand, this is the first systematic and complete approach to analyze and estimate the contribution of knowledge to performance. Using the production function approach, it was possible to estimate the knowledge elasticity of performance, which provides valuable insight on the resource allocation for knowledge management activities.

Reward systems for intra-organizational knowledge sharing

“…Second, our model assumed that the potential contribution of shared knowledge to the payoff can be identified. Although attempts have been made to measure the functional relationship (e.g., Chang and Ahn, 2005) and the information about the value of explicit knowledge may disseminate easily (Lin et al, 2005), the estimation of the value of knowledge is still subject to uncertainty in many cases. Lin et al (2005) address this issue from the perspective of information structure in knowledge transfer: information incompleteness and information asymmetry about the value of knowledge between a knowledge sender and knowledge receiver.…”

“…While there is a wide range of other motives for human behavior including needs for achievement, responsibility, and recognition (Donaldson, 1990), the simplified model of individual motivation to maximize self-utility could provide fruitful insights and does not limit the possibility of theoretical integration with traditional management theories (Barney, 1990). The firm is assumed to desire to increase the net payoff through KM because organizational knowledge ultimately contributes to financial performance of the firm (Chang and Ahn, 2005;Chen and Edgington, 2005). Also each knowledge worker is assumed to have unique knowledge, and therefore there is only one possible provider for each knowledge component.…”

“…Let F(s; k) denote the additional payoff given s and k. The additional payoff from KM can be obtained by using the knowledge base to either increase the value or decrease the costs of the firm's products or services (Chen and Edgington, 2005;Ofek and Sarvary, 2001). 5 Although there have been some concerns about the difficulty in identifying the contribution of KM to the firm performance, attempts have been made to measure the value of investments in KM (Chang and Ahn, 2005;Samaddar and Kadiyala, 2006). 6 Additionally, the idea that KM efforts have measurable outcomes is the underlying proposition of the ''stock'' view of knowledge (Samaddar and Kadiyala, 2006).…”

Leveraging organizational performance via knowledge management systems platforms in emerging economies

“…Concisely, it is widely argued that knowledge is considered to be a vital organization resource, which leverages performance by VINE 45,2 increasing the efficiency level, raise personnel awareness and drive innovation (Arnold et al, 2008;Benbasat and Gregor, 1999;Chalmeta and Grangel, 2008;Martensson, 2000). This paper argues that by creating a systematic KM process, it becomes more visible and controllable, and in so doing, KM can serve improving both performance and innovation and, consequently, it can create success measures for the Egyptian ICT sector (Chang and Ahn, 2005;Law and Nagi, 2008).…”

Embedded knowledge management: towards improved managerial relevance

“…For example, previous studies have proposed that knowledge management should be integrated with innovation management (Goh 2005), customer relationship management (Gebert et al 2003), regional development (Carrillo et al 2014), the management of business growth (Laihonen et al 2015), process management (Maier and Remus 2003;Stary 2014;Strohmaier and Tochtermann 2005), products and processes (Chang and Ahn 2005) and the phases of consulting project execution (Ambos and Schlegelmilch 2009).…”