IS Support for Knowledge Management and Firm Performance: An Empirical Study

IS Support for Knowledge Management and Firm Performance: An Empirical Study

Michael J. Zhang (Sacred Heart University, USA)
DOI: 10.4018/978-1-60566-140-7.ch014
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Abstract

While a great deal has been written about how information systems (IS) can be deployed to facilitate knowledge management for performance improvements, there is little empirical evidence suggesting such IS deployment can actually improve a firm’s bottom-line performance. This study attempted to assess the impacts of IS support for two key knowledge management activities (knowledge generation and knowledge transfer) on labor productivity and profitability with both survey and archival data. The potential moderating effects of firm-specific, complementary organizational resources on the performance impacts of the IS support were also examined and tested. The results showed that IS support for knowledge generation and IS support for knowledge transfer both had direct positive effects on labor productivity. Coupled with firm-specific, complementary organizational resources, both types of IS support exerted positive effects on profitability.
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Introduction

With the widespread recognition of knowledge as a key source of sustainable competitive advantage (Nonaka & Takeuchi, 1995; Quinn et al., 1996; Spender & Grant, 1996), how to manage organizational knowledge to achieve and maintain competitive advantage and superior economic performance becomes a critical issue facing many firms. In the field of information systems (IS) management, the past decade has witnessed a proliferation of research on IS roles in knowledge management (see Alavi & Leidner (2001) for a review of this body of research). While much of the extant literature has identified various ways IS can be deployed to support knowledge management and IS support for knowledge management is often assumed to improve organizational effectiveness, efficiency and competitiveness (Alavi & Leidner, 2001; Gold et al., 2001; Alavi & Tiwana, 2003; Shin, 2004), it remains unclear whether such IS support would actually result in positive economic returns, due to scant empirical evidence linking IS support for knowledge management directly to the bottom-line performance of firms. Without large-scale empirical research assessing the bottom-line performance impacts of IS support for knowledge management, firms and their managers interested in investing in IS support for knowledge management to improve their competitive position and performance have little evidence on which to base their IS investment and deployment decisions.

Furthermore, although IS have traditionally been viewed as one of the key enabling tools for knowledge management (Davenport & Prusak, 1998; Alavi & Leidner, 2001), researchers have increasingly entertained the notion that IS alone would not influence firm performance, but have to be complemented by other firm-specific organizational resources (e.g., organizational culture and structure) in order to confer knowledge-based competitive advantage (Roberts, 2000; Davenport et al., 2001; Lubit, 2001; Karlsen & Gottschalk, 2004). The presence of these firm-specific, complementary organizational resources not only enables a firm to reap the economic benefits from using IS to support knowledge management, but also helps the firm better defend its advantage resulting from such IS support (Clemons & Row, 1991; Grant, 1996a; Bharadwaj, 2000). Unfortunately, discerning the moderating effects of such complementary organizational resources on the performance impacts of IS support for knowledge management has received scant attention in the existing literature.

The purposes of this study were two folds. First, it provided an empirical assessment of the performance impacts of IS support for knowledge management by testing the relationships between IS support for two key knowledge management activities (knowledge generation and knowledge transfer) and firm performance. Second, the study examined and tested the potential moderating effects of certain unique organizational resources that complement the IS support for knowledge generation and knowledge transfer (i.e., firm-specific resources a firm needs in order to effectively develop and deploy IS to facilitate knowledge generation and knowledge transfer) on the above-mentioned relationships.

Complete Chapter List

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Table of Contents
Chapter 1
Murray E. Jennex
This is the third volume in the Advances in Knowledge Management and I thought it appropriate to start this volume with some reflection on where KM... Sample PDF
Reflections on Knowledge Management Research and Practice
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Chapter 2
Peter Keen, Margaret Tan
The chapter proposes a simple framework termed ‘knowledge fusion’ to extend the rigor and relevance of knowledge management (KM). It points to some... Sample PDF
Knowledge Fusion: A Framework for Extending the Rigor and Relevance of Knowledge Management
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Chapter 3
Hazel Taylor
This chapter explores the concept of ‘tacit knowledge’ and how organizations can foster the sharing and exchange of tacit knowledge. Various views... Sample PDF
Tapping Tacit Knowledge
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Chapter 4
Andrea Hornett, Eric W. Stein
This chapter adds to our understanding of knowledge management as an evolving body of concepts, relationships, strategies and practices. Using... Sample PDF
Advances in Knowledge Management: Mapping Ideas that Shape Practice
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Chapter 5
Clyde W. Holsapple, Kiku G. Jones
Just as Porter’s value chain model identifies classes of business activity that can be performed in ways that contribute to a firm’s... Sample PDF
Knowledge Chain Activity Classes: Impacts on Competitiveness and the Importance of Technology Support
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Chapter 6
Rahinah Ibrahim, Mark E. Nissen
Tacit knowledge attenuates particularly quickly in organizations that experience discontinuous membership: the coming and going of organizational... Sample PDF
Developing a Knowledge-Based Organizational Performance Model for Improving Knowledge Flows in Discontinuous Organizations
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Chapter 7
Frank Land, Urooj Amjad, Sevasti-Melissa Nolas
The purpose of this chapter is to argue the case that the study of Knowledge Management should embrace considerations of ethics and accountability.... Sample PDF
Accountability and Ethics in Knowledge Management
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Chapter 8
Chay Yue Wah
The study aims to understand the social and organizational factors that influence knowledge sharing. A model of knowledge management and knowledge... Sample PDF
Social Capital and Knowledge Sharing in Knowledge-Based Organizations: An Empirical Study
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Chapter 9
Charlie C. Chen, Rong-An Shang, Albert L. Harris, Zhi-Kai Chen
A knowledge management system (KMS) project transcends functional departments and business partners. The success of KMS implementation is highly... Sample PDF
A Structured Method for Evaluating the Management of a Knowledge Management System Implementation
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Chapter 10
Murray E. Jennex, Stefan Smolnik, David T. Croasdell
This chapter explores knowledge management, KM, and knowledge management system, KMS, success. The inspiration for this chapter is the KM Success... Sample PDF
Toward a Consensus Knowledge Management Success Definition
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Chapter 11
Elsa Rhoads, Kevin J. O'Sullivan, Michael Stankosky
This research chapter investigates the status of knowledge management (KM) practices implemented across federal agencies of the U.S. government. It... Sample PDF
An Evaluation of Factors that Influence the Success of Knowledge Management Practices in U.S. Federal Agencies
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Chapter 12
Kevin Laframboise, Anne-Marie Croteau, Anne Beaudry, Mantas Manovas
This article reports on a study that investigates the knowledge transfer between an information systems/ technology (IS/IT) department and non-IT... Sample PDF
Interdepartmental Knowledge Transfer Success During Information Technology Projects
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Chapter 13
Claudio Vitari, Jennifer Moro, Aurelio Ravarini, Isabelle Bourdon
The purpose of this chapter is to contribute to the improvement of the acceptance of information systems (IS) devoted to the codification and... Sample PDF
Improving KMS Acceptance: The Role of Organizational and Individuals' Influence
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Chapter 14
Michael J. Zhang
While a great deal has been written about how information systems (IS) can be deployed to facilitate knowledge management for performance... Sample PDF
IS Support for Knowledge Management and Firm Performance: An Empirical Study
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Chapter 15
Wei Li, Alexandre Ardichvili, Martin Maurer, Tim Wentling, Reed Stuedemann
The goal of this study was to explore how national (Chinese) culture influences knowledge sharing in virtual communities of practice at a large... Sample PDF
Chinese Culture and Virtual Knowledge Sharing in a Multinational Corporation
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Chapter 16
Gilles Balmisse, Denis Meingan, Katia Passerini
In this chapter, we update earlier research on the state of the art Knowledge Management (KM) tools and present key evaluation criteria that can be... Sample PDF
Selecting the Right Knowledge Management Tools: Software Trends and Key Evaluation Criteria
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Chapter 17
Jörg Rech, Raimund L. Feldmann, Eric Ras
Knowledge management is a relatively young discipline. It has accumulated a valuable body-of-knowledge on how to structure and represent knowledge... Sample PDF
Knowledge Patterns and Knowledge Refactorings for Increasing the Quality of Knowledge
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Chapter 18
Paul Jackson, Ray Webster
This chapter is concerned with engaging end-users in the design and development of knowledge management systems. The identification, capture and use... Sample PDF
Knowledge Elicitation and Mapping: Ontology as an Instrument of Design and Organizational Learning
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Chapter 19
Aurora Vizcaino, Juan Pablo Soto, Javier Portillo, Mario Piattini
Efforts to develop Knowledge Management have increased in recent years. However, many of the systems implanted in companies are still not greatly... Sample PDF
Helping to Develop Knowledge Management Systems by Using a Multi-Agent Approach
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Chapter 20
Mirghani Mohamed, Michael Stankosky, Vincent Ribière
The purpose of this chapter is to examine the requirements of Knowledge Management (KM) services deployment in a Semantic Grid environment. A wide... Sample PDF
Adopting the Grid Computing & Semantic Web Hybrid for Global Knowledge Sharing
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Chapter 21
Sineed Paisittanand, L. A. Digman, Sang M. Lee
The creation and the use of knowledge have increasingly been regarded as important issues for management. A wide range of studies have investigated... Sample PDF
The Effect of Knowledge Process Capabilities and Knowledge Infrastructure Capabilities on Strategy Implementation Effectiveness
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