Assessing Knowledge Management Processes and Competitive Advantage in Local Authorities using Knowledge Management Assessment Instrument (KMAI)

Assessing Knowledge Management Processes and Competitive Advantage in Local Authorities using Knowledge Management Assessment Instrument (KMAI)

Abu Hassan Abu Bakar (Universiti Sains Malaysia, Malaysia), Wiwied Virgiyanti (Universiti Sains Malaysia, Malaysia), Muhammad Asim Tufail (Universiti Sains Malaysia, Malaysia) and Mohamad Nizam Yusof (Universiti Sains Malaysia, Malaysia)
DOI: 10.4018/978-1-4666-4434-2.ch013
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Abstract

For academics and professionals, knowledge management has been widely known as a core agenda and has been recognized as one of the most important sources of competitive advantage. Managing knowledge to achieve organizational performance is not only crucial for private sector institutions, but it is significant for the public sector institutions as well. Since the study of knowledge management in the public sector is still in its infancy, this study is aimed at investigating the relationship between knowledge management processes and competitive advantages in local authorities in Malaysia to raise the awareness of the importance of managing organizational knowledge, particularly in the public sector. For this study, the data was collected from selected Heads of Departments in 42 institutions of local authorities in Peninsular Malaysia and yielded 82 usable responses. The analysis suggests that all six knowledge management processes (knowledge creation, capture, organization, storage, dissemination, and application) have a strong relationship with competitive advantage. This study is expected to raise awareness and provide initial guidelines to local authorities as knowledge-intensive institutions to formulate strategies on how to manage the knowledge management processes within the organization.
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Background

Many organizations have initiated on knowledge management as a core strategy to enhance their organizational competitive advantage (Brailsford, 2001; De Long & Fahey, 2000; Nidumolu, Subramani, & Aldrich, 2001). Since knowledge has been widely recognized as a competitive advantage, and increasing number of organizations are incorporating the knowledge management strategy (Armbrecht et al., 2001; De Tienne & Jackson, 2001). Thus, it is significant to understand how to manage valuable knowledge in every organization.

Most research in the area of knowledge management have been done in private organizations. As the result, there is relatively little information on knowledge management in the public sector, and even less in developing countries. This is due to the fact that public sector organizations implement knowledge management for providing services to the public rather than gaining financial profit. Thus, there is no established body of knowledge on successful management strategies in the private sector that can be drawn upon by public agency (Boyne, 2002). Consequently, there is a need of strategy designed especially for the public sector to be developed in order to fill the gaps and for cross learning between private and public sector.

In Malaysia, the concern of the Government of Malaysia in developing the nation through the knowledge economy has become apparent. Government organizations are urged to develop a more knowledgeable organization, especially in terms of managing resources and providing services to the public. It is the emphasis of K-Economy declaration by the former Prime Minister of Malaysia, Mahathir Mohamed, who stated that the knowledge is real and showed on a graph “that productivity growth doubled in knowledge-rich economies” (Mohamed, 2000).

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