The Effects of Knowledge Creation Process upon the Organizational Performance: A Study of Thai Banking Industry

Abstract

Abstract-Asknowledge-based economy emerged, knowledge management (KM) turns to be a principle for organizations to maximize to the value of knowledge. Among KM domains, knowledge creation is the most concerned aspect when it comes to innovation, creativity, performance, and learning. Reviewing on academic literature, the application of SECI model, a well-known knowledge creation theory, is hardly seen in Southeast Asian countries especially in banking industry. The objective of this study is to investigate the effects of knowledge creation upon the organizational performance. The research scope is banking industry in Thailand, focusing on commercial banks. The goal of research was achieved by developing statistical testing using multiple regression. Findings indicate that knowledge creating process positively affect to organizational performance. However, based on Holistic scorecard framework, not all modes of SECI process significantly affect to each perspective of organizational performance. Knowledge creation process is also influenced by collective culture and the nature of banking industry which makes each SECI process affects differently to organizational performance.Index Terms-Knowledge creation process, SECI model, knowledge management, organizational performance. I. INTRODUCTIONSince the world economy has moved to the knowledge based and global economy, Knowledge management (KM) becomes the important principle in organizations to maximize the value of knowledge and capture them from knowledge workers. There are two main points why an organization needs KM. First, knowledge is like other resources which require management to support allocation and development. Second, management mechanisms are needed to change knowledge into business outcomes [1]. KM has become the topic in banking industry since 1996 when World Bank initiated KM concept [2]. It is truly important in banking industry because banking operations required the higher complexity of knowledge than in most industries [3]. Even though KM is one of the key success factors in banking business, it seems to have a few interesting of KM within banks in Southeast Asian countries. Therefore, there is still have room for further studies of KM in these countries.Considering among KM domains, "Knowledge Creation" is the most concerned aspect when it comes to innovation, creativity, performance, and learning. The quicker the creation and consolidation of knowledge in business process, the higher capability to innovate of an organization [4]. Knowledge Creation is mainly about knowledge generation and application which leads to the company's new capabilities while innovation is concerned with turning the new capabilities into value products and services [5]. In term of creativity, the larger of knowledge based in organization, the higher level of advanced learning and finally leads to higher organizational creativity [6]. As the view of organizational performance, knowledge creation process has a significant connection with organizational learning which is...

Process Management Practice Analysis on Organizational Performance Mediated by Knowledge Creation

“…On the other hand, the results of this study strengthen the role of knowledge creation as a predictor variable as well as answer the gap from the knowledge creation test -performance is concluded that there is a strong influence between knowledge creation and performance. These results support the results of previous studies that the knowledge creation process affects company performance (Nakamori, 2011;Arijitsatien & Ractham, 2017;Haris & Corresponding, 2017).…”

“…Process management includes process control and continuous improvement (Baird et al, 2011). Process management reduces process variation (Al-Qahtani et al, 2015Al-Mulhim, 2017, improves output quality as well as minimizes reducing costs, thereby increasing performance (Al-Qahtani et al, 2015;Arijitsatien & Ractham, 2017). Statistical process control is the approach most often used to measure and evaluate the management of production and service processes such as in companies (Al-Qahtani et al, 2015).…”

“…The results of testing the creation of knowledge on performance show inconsistencies where some studies find that knowledge creation affect organizational performance (Nakamori, 2011;Harris & Corresponding, 2017;Arijitsatien & Ractham, 2017). In contrast, another study found that knowledge creation had no effect on organizational performance (Akhavan et al, 2014;Mehralian et al, 2018).…”

Bibliometric Review of Research on Knowledge Management and Sustainability, 1994–2018

“…Leading KM scholars such as Nonaka and Takeuchi established the widely-used knowledge creation model, SECI, which has been applied widely by proponents of knowledge management in sustainability projects [51,52]. Since the SECI model is an adaptable process, it has been applied to sustainability initiatives in various contexts, ranging from family businesses to larger corporations and financial firms [88,89]. SECI processes have also shaped the use of externalisation modes of knowledge creation in enhancing team performance [90].…”

The Role of Learning Organization Dimensions on Enhancing Knowledge Creation: The Case of Commercial Banks Working in Jordan

“…Therefore, knowledge management is important in enhancing and achieving competitive advantages (Hajir, et al, 2015) that is distinctive in order to target innovation, learning, and performance that emphasis and intensify development (Martineau, Knox, & Combs, 2014;Arijitsatien & Ractham, 2017).…”