This chapter analyses the implementation of knowledge management strategies (KMS) in technologyintensive firms. Firstly, a review of KMS in the knowledge management (KM) literature is carried out in order to conceptually establish the focus of the chapter. Next, some key factors for successful KM implementation, such as corporate culture, technological systems, ethical leadership, human resources management practices and organizational flexibility are identified and explained. After that, the case study of two firms which have successfully implemented a KMS in innovation-intensive industries, such as electronics and information technologies, is shown. Finally, and based on the results of the case study, some suggestions are extracted and recommendations are made from a managerial perspective in order to implement a KMS effectively.
The knowledge-based view of the firm, in line with the resource-based view, considers knowledge as the most important strategic resource for ensuring an organization’s long-term success and survival, because it is unique and difficult to imitate (Winter, 1987; Kogut and Zander, 1992; Grant, 1996; Conner and Prahalad, 1996; DeCarolis and Deeds, 1999). Hence, processes to manage this asset –e.g., transfer, storage and application– are recognised to be basic for the firm, and their strategic consideration imply they are fundamental to attain a firm’s objectives (Zack, 1999a; Earl, 2001). In relation to this, some researchers understand knowledge management strategy (KMS) as the design of the processes related to the management of organizational knowledge and their implementation for the fulfilment of a firm’s goals, among which innovation is included (e.g., Bierly and Chakrabarti, 1996; Hansen, Nohria and Tierney, 1999; Earl, 2001; Schulz and Jobe, 2001; Clarke and Turner, 2002; Maier and Remus, 2002; Choi and Lee, 2003; Garavelli, Gorgoglione and Scozzi, 2004; Donate and Guadamillas, 2007).
Research interest and empirical efforts in the study of the relationship between knowledge management (KM), innovation and competitive advantage have grown recently, and significant contributions have been made (see e.g., Gopalakrishnan and Bierly, 2001; Thomke and Kuemmerle, 2002; Nerkar and Roberts, 2004; Kor and Mahoney, 2005; Smith, Collins and Clarke, 2005; Subramanian and Youndt, 2005). Essentially, these works show that the knowledge base of the firm determines innovation efforts and may have a strong influence on their cost and performance. Thus, one firm can also achieve superior performance on the basis of its ability to generate new knowledge and utilize the existing base more effectively and efficiently than competitors (Grant, 1996; DeCarolis and Deeds, 1999). In this sense, the development of an effective KMS can be regarded as an important factor in contributing to a firm’s pursuit of competitive advantage based on innovation (Zack, 1999a; Donate and Guadamillas, 2007).
For a KMS to be effective an adequate implementation approach is required (Donate and Guadamillas, 2007). For example culture, leadership or the kind of organizational structure are aspects, among others, which the companies have to take into account in order to put its selected KMS into practice. But although certain researchers in KM have broadly highlighted the role of the KMS formulation (see e.g., Bierly and Chakrabarti, 1996; Hansen et al., 1999; Choi and Lee, 2003) to date less has been published on the issue of the implementation. In this sense, more research on KMS implementation frameworks and the key elements that should be including in them is still necessary to ensure firms the success of their KM endeavours (Wong and Aspinwall, 2004: 94). Moreover, the analysis of such elements can help to better understand the main difficulties associated with this process –i.e., implementation– and identify how the firm can encourage its staff to use certain formal instruments in order to make the KMS implementation easier. Thus, the aim of this work is to explore what factors were present in two innovative firms that made significant progress in achieving their strategic objectives through appropriate implementation of KM strategies.