Table of Contents

CHAPTER 1............................................................................................................1
1 INTRODUCTION.............................................................................................3
1.1 BACKGROUND...............................................................................................3
1.2 STATEMENT OF THE PROBLEM.......................................................................7
1.3 RESEARCH OBJECTIVES................................................................................8
1.4 RESEARCH PROPOSITION..............................................................................8
1.5 RESEARCH QUESTIONS.................................................................................9
1.6 RESEARCH JUSTIFICATION............................................................................9
1.7 SCOPE OF RESEARCH...................................................................................9
CHAPTER 2............................................................................................................9
2 LITERATURE REVIEW.................................................................................11
2.1 INTRODUCTION........................................................................................... 11
2.2 DEFINITIONS...............................................................................................11
2.2.1 Knowledge..........................................................................................11
2.2.2 Management.......................................................................................13
2.3 KNOWLEDGE MANAGEMENT........................................................................13
2.4 KNOWLEDGE AS A RESOURCE- RESOURCE BASED VIEW (RBV) OF THE FIRM
14
2.5 ORGANISATIONAL KNOWLEDGE....................................................................16
2.5.1 Explicit Knowledge..............................................................................17
2.5.2 Tacit Knowledge.................................................................................18
2.6 THE TECHNOLOGY FACTOR.........................................................................19
2.7 BENEFITS OF MANAGING KNOWLEDGE.........................................................20
CHAPTER 3..........................................................................................................24
3 RESEARCH METHODOLOGY.....................................................................24
3.1 INTRODUCTION........................................................................................... 24
3.2 RESEARCH FRAMEWORK.............................................................................24
3.3 RESEARCH DESIGN.....................................................................................25
3.3.1 Qualitative Research..........................................................................25
3.3.2 Quantitative Research........................................................................25
3.4 POPULATION...............................................................................................26
3.5 SAMPLING AND SAMPLING TECHNIQUES.......................................................26
3.5.1 Random Sampling..............................................................................27
3.5.2 Sampling Methods used.....................................................................27
3.6 DATA COLLECTION......................................................................................28
3.7 RESEARCH LIMITATIONS..............................................................................31
CHAPTER 4..........................................................................................................32
4 RESEARCH FINDINGS AND ANALYSIS....................................................32
4.1 INTRODUCTION........................................................................................... 32

1
 4.2 RESPONSE RATE........................................................................................33
4.2.1 Knowledge Creation...........................................................................35
4.2.2 Knowledge Sharing............................................................................41
4.2.3 Barriers to Knowledge Management..................................................43
4.2.4 KM Success Factors...........................................................................43
4.2.5 Benefits of KM....................................................................................44
4.2.6 Information Technology (IT) in KM.....................................................45
4.2.7 KM and Organisational Performance.................................................46
5 SUMMARY, RECOMMENDATIONS AND CONCLUSIONS.......................49
5.1 INTRODUCTION........................................................................................... 49
5.2 CONCLUSIONS............................................................................................49
5.3 RECOMMENDATIONS...................................................................................51
5.4 AREAS OF FURTHER RESEARCH..................................................................52
References....................................................................................................53

Table of Figures

Figure 1: Ontological Diagram of organizational knowledge................................17

Figure 2: Definition of Knowledge.........................................................................35
Figure 3: Knowledge Creation Activities...............................................................36
Figure 4 Knowledge of the Organisation’s KM Strategy......................................38
Figure 5: Organisational Support for Continuous Learning..................................39
Figure 6: Knowledge Retention............................................................................41
Figure 7: KM and Organisational Performance....................................................47

2
 CHAPTER 1

INTRODUCTION

1 Introduction
This chapter gives the background to the topic under discussion. It looks at the
motivations for Knowledge Management (KM). The problem statement,
research questions, objectives, justification, scope and the dissertation outline
are presented.

1.1 Background
The management of knowledge is increasingly becoming very important as the
world is becoming a global market and as competitive pressures increase. The
workforce has become multi-racial, multi-cultural and in some cases multi-skilled
and as a result challenges to managing knowledge have become more complex.
In order to cope effectively with the changing environment, organisations and
their employees need to act as learning organisms and be adaptive, innovative
and be able to process information about their environment and turn this
information into knowledge which can be shared within the organisation (Choo
1995a).

Corporate survival, increased competitiveness and growth strategies have led to

an increase in the number of corporate restructuring. Mergers, de-mergers,
downsizing, right sizing, business re-engineering, strategic alliances and
reorganising are all modern buzzwords that result in displacement and
retrenchment of people which may result in loss of valuable knowledge
resources. Organisations need to create an environment that encourages
knowledge creation, sharing and application. Managing such an environment is
crucial in any organisation as it impacts on organisational performance.

3
The management of knowledge has received great attention in a number of
studies. This is a result of the transition of organisations from being the command
and control type of organisations to information based organisations
characterised by organisation of “knowledge specialists (Drucker 1993). There
has been a shift of focus from “what you own to what you know, from tangible to
immaterial” (Stewart 1997a). However, some of these studies have not
addressed the relationship between knowledge management and organisational
productivity and how leveraging knowledge assets can lead to the attainment of
organisational objectives.

Studies have also indicated that knowledge management has implications on

employee productivity and ultimately organisational performance. An
understanding of knowledge management practices will help in defining the
relationship between knowledge management and organisational performance.
According to Drucker (1997), the productivity of knowledge and knowledge
workers will become the decisive factor in the world economy through
acquisition, creation, manipulation, interpretation and use of information and
knowledge which will result in competitive advantages.

This study seeks to investigate the relationship between knowledge management

and organisational performance in Building Societies in Zimbabwe. It is aimed at
identifying the challenges involved in knowledge management. It seeks to
answer the question, “Is there a relationship between knowledge management
and organisational performance?” Primary data was collected through a
questionnaire and secondary was used to evaluate organisational performance.
The results of the desk research and quantitative survey were then used to make
some judgments concerning the relationship between knowledge management
and organisational performance.

4
The financial Services Sector
Building Societies are a sub sector of the financial services sector whose core
business is advancing funds for the purchase or construction of urban immovable
property. There are four operating Building Societies in Zimbabwe and one of
them was placed under the supervision of a curator around 2004 due to financial
mismanagement.

An organisational analysis was done for four Building Societies for a period of
three years from 2005 to 2007. A cost to income ratio was arrived at by dividing
total expenses by total revenue as a performance measure. For purposes of
maintaining organisational confidentiality the Building Societies were not keen on
being identified by name in the study, hence referred to as Building Societies A,
B, C and D.

The results show an overall improvement in performance across the four

organisations. The surplus figures indicate that there is no sustainable growth in
three Building Societies. The revenue generated was all wiped out by escalating
operating costs and interest expenses while inflation continue to expose financial
operations to impairment costs.

The results show an overall improvement in performance across the four

organisations as evidenced by the cost to income ratio which has improved for
the better in 2007. However, in view of the hyper-inflationary environment
prevailing in Zimbabwe there is no sustainable growth due to escalating
operating costs and interest expenses.

An analysis of the four Building Societies’ Annual Reports and Financial

Statements from 2005 to 2007 shows that the cost to income ratios were
93%,65% and 41% for Building Society A, 120%, 62% and 41% for B, 96%, 74%
and 47% for C and 77% and 41% for D. The cost to income ratio for Building

5
Society D for 2005 is not available as it was under curatorship. (Annual Reports
and Financial Statements for Building Society “A, B, C and D” 2005 to 2007).

Ratios of such a magnitude are considered very high when compared with the
International Standard of 20% (www.bdc.ca). These percentages are an
indication that Building Societies in Zimbabwe need to improve their operational
efficiencies to reduce costs and be more profitable. It is against this background
that the implementation of effective knowledge management practices is
considered important for enhancing organisational performance.

Table 1: Building Society “A” Performance for the period December 2006 to
December 2007
Revenue Expenses Surplus Cost to Income
Z$ 000 Ratio
December 2 475 000 1 615 000 860 000 65%
2006
December 52 327 000 17 716 000 34 611 000 34%
2007

Table 2: Building Society “B” Performance for the period December 2005 to
December 2006
Revenue Expenses Surplus Cost to Income
Z$000 Ratio
December 294 000 182 000 112 000 62%
2006
December 11 336 000 4 625 000 6 711 000 41%
2007

Table 3: Building Society “C” Performance for the period December 2006 to
December 2007

6
 Revenue Expenses Surplus Cost to Income
Ratio
Z$000 000

December 2006 577 000 426 000 151 000 74%

December 2007 14 220 000 6 740 000 7 480 000 47%

Table 4: Building Society “D” Performance for the period December 2006 to
December 2007

Revenue Expenses Surplus Cost to Income

Ratio
Z$000

December 2006 107 484 83 000 24 484 77%

December 2007 8 144 000 3 368 000 4 776 000 41%

1.2 Statement of the Problem

Measuring organisational performance is a complicated task that calls for the use
of a variety of measures. According to Snow and Hrebiniak (1980), no single
measure of performance may fully account for all aspects of organisational
performance. Traditionally organisational performance has been measured in
terms of efficiency and or effectiveness. Measures of efficiency have a cost
benefit focus, comprising a ratio of some inputs and outputs such as return on
assets, return on equity and other financial ratios (Ramaswamy et al 1993).
Measures of effectiveness have a revenue generation focus and use variables
such as market share and sales (Subramanian and Nilakanta 1996). These
traditional measures focused on financial outcomes and growth.

Soft measure
Kaplan and Norton (1992) focus on the soft performance such as innovation,
learning, customer satisfaction and employee satisfaction among many other
variables. They believe that if the soft issues are taken care of, then the rest of
other things will look after themselves. Thus an organisation can improve its
performance through the provision of innovative products, continuous learning,

7
and customer as well as employee satisfaction. Other researches have
established a linear relationship between each of the soft issues such as
innovation, organisational learning, market orientation and customer satisfaction
and organisational performance in terms of financial outcomes and growth
(Wang and Ahmed 2003).

However, Drucker (1993) states that knowledge is the only meaningful resource
and constitutes the value of most products and services. A knowledge based
view of the firm is important in understanding the relationship between firm
capabilities and firm performance (Decarolis and Deeds 1999). There is limited
evidence however, that links knowledge management to organisational
performance. This study seeks to establish whether a relationship exists between
knowledge management and organisational performance in terms of both the
traditional and the soft approach.

1.3 Research Objectives

The objectives of the study are to:
1. Establish the knowledge creation activities in Building Societies in
Zimbabwe.
2. Identify the benefits that organisations derive from managing knowledge.
3. Establish barriers to Knowledge Management.
4. Identify KM success factors in Building Societies.
5. Determine how KM affects organisational performance.

1.4 Research Proposition

Studies have shown that there is a relationship between knowledge management
and organisational performance. The study makes the following proposition:
Knowledge Management practices will result in improved organisational
performance.

8
1.5 Research Questions
1. How is knowledge shared within Building Societies in Zimbabwe?
2. To what extent do Building Societies in Zimbabwe support the
development of new ideas?
3. Is the organisational environment within Building Societies in Zimbabwe
supportive of KM activities?
4. Do Building Societies in Zimbabwe have a learning culture and how
important is organisational learning to performance?
5. What are the success factors for KM in Zimbabwe’s Building Societies?
6. What is the role of technology in the management of knowledge resources
in Building Societies in Zimbabwe?
7. What are the benefits of managing knowledge?

1.6 Research Justification

The role of KM in organisational performance has been a focus in both academic
and industrial practices. Few empirical researches have been done and this
study seeks to add to the available body of knowledge on KM and organisational
performance. Thus the study seeks to address the existing research gap by
examining the relationship between organisational dimensions of learning,
knowledge sharing and innovation as well as bottom line organisational
performance. The results from this study will equip managers with innovative
ideas to improve organisational performance. It will recommend ways through
which organisations can improve their KM strategies.

1.7 Scope of Research

The study will focus on all employees of the Building Societies in Zimbabwe. It is
meant to establish knowledge management initiatives within these organisations
and compare with the organisations’ performance in the three financial years;

9
2004, 2005 and 2006 based on the financial results to find out if there is a
correlation.

Dissertation Outline
Chapter 1: Gives the general industry background of the companies under
study, introduces the problem statement, research objectives, the research
proposition, justification and scope of the study.
Chapter 2: Reviews the relevant literature and provides the theoretical and
conceptual framework within which the research will be conducted.
Chapter 3: Provides the methodology and the research framework to be used for
the study. The types of research, data collection methods, presentation and
analysis methods are discussed.
Chapter 4: Looks at the findings of the research, analysis and presentation of
data.
Chapter 5: Provides the conclusions drawn from the research findings as well as
the recommendations.

CHAPTER 2

10
2 LITERATURE REVIEW

2.1 Introduction
This chapter reviews KM literature by looking at the various definitions and
concepts used in KM, types of organisational knowledge, approaches to KM, KM
success factors, knowledge sharing as well as different models used in the study
of knowledge management. The literature review seeks to explore existing theory
on KM concepts and how they contribute to the improvement of organisational
performance.

2.2 Definitions

2.2.1 Knowledge
Knowledge is defined as information combined with experience, context,
interpretation and reflection that permit people to make predictions, causal
associations or prescriptive decisions about what to do (Business Briefing 2006).
Marakas (1999) and Brooking (1999) supports this position by pointing out that
knowledge is information in context.

Bhatt (2000a) suggests that knowledge is an organised combination of data

assimilated with a set of rules, procedures and operations learnt through
experience and practice, “a meaning made by the mind”. On the other hand,
Davenport and Prusak (1998) state that knowledge is a fluid mix of framed
experiences, values, contextual information and expert insight that provide a
framework for evaluating and incorporating new experiences and information.

However, Blackler (1995) argues that knowledge is multifaceted and complex,

being situated and abstract, implicit and explicit, distributed and individual,
physical and mental, developing and static, verbal and encoded. He further
categorises knowledge into four categories as shown below:
1. Embedded in technologies, rules and organisational procedures
2. Encultured as collective understandings, stories, values and beliefs

11
 3. Embodied into practical activity-based competencies and skills of key
members of the organisation
4. Embraced as the conceptual understanding and cognitive skills of key
members

According to Nonaka (1991), knowledge is held either by individuals or

collectively by a group of people. Blackler (1995) suggests that knowledge can
either be “embodied or embraced knowledge” which is individual and embedded
as well as cultural knowledge which is collective. Sveiby (1997) argues that
business managers need to realise that unlike information, knowledge is
embedded in people…. and that knowledge creation occurs during the process of
social interaction. Torrington, Hall and Taylor (2005) argue that knowledge is
complex as it is something that exists in a person’s head that can be realised
when it is applied.

Knowledge is distinguished from data in that data is defined as raw facts

Brooking (1999). Ackoff went on further to explain that data have no significance
beyond their existence and that they can exist in any form. Armstrong (2001)
argues that data provide the building blocks for information and Bhatt (2001)
identifies a close relationship between the three concepts data, information and
knowledge. He points out that this relationship depends on the degree of
organisation and interpretation. Thus he argues that the distinguishing factor
between data and information is “organisation” and that between information and
knowledge is “interpretation”.

Information is regarded as an organised set of data that has been given meaning
by way of relational connection. It is the output of the analysis and
conceptualisation of raw data so that they become meaningful (Ackoff1989). On
the same note, Armstrong (2001), points out that information is data that have
been processed in a way which is meaningful to individuals and is available to
anyone entitled to gain access to it. It is information endowed with meaning and

12
purpose (Drucker (1993). This study will define knowledge according to Blackler
(1995) who views knowledge as multi-faceted abstract, situated, implicit and
explicit, individual and distributed.

2.2.2 Management
Management is the process of forming a strategic vision, setting objectives,
crafting a strategy and then implementing and executing the strategy. It goes
beyond the organisation’s internal operations to include the industry and the
general environment. The key emphasis in management are environmental
scanning and industry analysis, appraisal of current and future competitors,
assessment of core competencies, strategic control and effective allocation of
organisational resources (www.indianchild.com).

2.3 Knowledge Management

There is no consensus as to what constitute knowledge management.
Knowledge management is defined by Bhatt (2000a) as a process of knowledge
creation, validation, presentation, distribution and application. Tan (2000) argues
that KM is the process of systematically and actively managing and leveraging
the stores of knowledge in the organisation. It is concerned with the exploitation
and development of the knowledge assets of the organisation with a view of
furthering the organisation’s objectives.

KM entails all processes associated with the identification, sharing and creation
of knowledge (Davenport and Prusak 1998). It refers to a range of practices used
by organisations to identify, create, represent and distribute knowledge for reuse,
awareness and learning across organisations. On the other hand Maholtra
(1998) states that KM caters for the critical issues of organisational adaptation,
survival and competence in the face of increasingly discontinuous environmental
change. It embodies organisational processes that seek synergistic combination

13
of data and information processing, capacity of information technology and the
creative and innovative capacity of human beings.

However, according to Drucker as cited in Kotzer (2001), knowledge cannot be

managed as it exists between two ears. To him it is about what individual
workers do with the knowledge they have and when they leave the company,
their knowledge goes with them irrespective of how much they would have
shared. If this view holds then this study seeks to establish the extent to which
Building Societies in Zimbabwe can succeed in managing this resource to
improve performance.

Scarborough et al (1999), states that KM is any process or practice of creating,

acquiring, capturing sharing and using knowledge, wherever it resides, to
enhance learning and performance in organisations. It is about the creation of
firm specific knowledge and skills that are the result of organisational learning
processes. Application of these skills and knowledge would lead to improved
organisational performance.

2.4 Knowledge as a Resource- Resource Based View (RBV) of

the Firm
The resource based view of the firm emphasises identification of organisational
resources and assess capability of utilising them (Crossan, Lane and White
(1999). Central to the resource based view are the definitions of competitive
advantage and sustained competitive advantage. Thompson and Strickland
(2003), points out that the differences in company resources account and why
some companies are more profitable and more competitively successful than
others.

The RBV view companies as a collection of physical and intangible assets and
capabilities. These resources and capabilities are embedded in the firm’s
routines, processes and culture (Harvard Business Review August 1995). Fahy

14
(1999) argues that not all resources are of equal importance or possess the
potential to be a source of competitive advantage. He further explains that focus
should be on advantage creating resources. Barney (1991) proposes that
advantage creating resources must meet four conditions namely, value,
rareness, inimitability and non substitutability. He further explains that a valuable
resource must permit the firm to conceive of or implement strategies that improve
its efficiency and effectiveness by meeting the needs of customers. This means
that any resource that does not result in the creation of value is not a potential
source of competitive advantage.

Another important characteristic of value creating resources according to Barney

(1991) is the inability by competitors to duplicate resource endowments. This
arises from a situation where the competitor is unable to get information with
regards to a firm’s success. Reed and De Fillippi (1990) term this concept
“causal ambiguity”. They suggest three characteristics of resources that can be
sources of ambiguity namely tacitness, complexity and specificity.

Tacitness is skill based and refers to the inability to identify or codify a pattern of
activities. According to Reed and De Fillippi (1990) skilled activities are based on
learning by doing that is accumulated through experience and refined through
practice. This is sometimes so great that not even managers within the firm
understand the relationship between actions and outcomes. Furthermore,
complexity is a result of the interconnectedness of asset stocks while specificity
results from path dependence of an individual firm’s activities which is very
difficult to identify and replicate (Barney 1995). However, even if these resources
can be identified and understood by competitors their imitation can be prevented
through property rights (Hall 1992). This explains why some firms operating
within the same environment perform better than others.

On the other hand Grant (1991) argues that levels of durability, transparency,
transferability and replicability should characterise these resources. Similarly

15
Collins and Montgomery (1995) state that they must meet five tests namely,
inimitability, durability, appropriability, substitutability and competitive superiority.
Thompson and Strickland (2003) summarised the characteristics of these
resources by stating that for a resource to be a basis for sustainable competitive
advantage it must pass four tests of competitive value which are:
1) Is the resource hard to copy?
2) How long does the resource last?
3) Is the resource really competitively superior?
4) Can the resource be trumped by the different resource or capabilities of
rivals?

According to Glazer (1998), KM is a representative paradigm reflecting this view

of the firm. Thus knowledge is viewed as the most valuable resource, inimitable
by others and sustainable once acquired. In KM, a capability is an organisational
ability of acquiring, maintaining and utilising its knowledge assets in a business
for its competitive advantage (Grant 1996a). Thus firms must identify strategic
knowledge resources and build knowledge based capabilities towards a
successful Institutionalisation of KM so as to achieve organisational goals (Bock
and Kim 2002).

2.5 Organisational knowledge

Organisational knowledge can be classified into two broad categories which;
individual and group knowledge. The two categories are further broken down into
tacit and explicit knowledge. Figure 2.1 below summarises the types of
organisational knowledge which helps managers to understand the form and
source in which knowledge exists so as to come up with appropriate strategies to
manage and use it.

16
Figure 1: Ontological Diagram of organizational knowledge
(Source: J. Vasconcelos, C. Kimble, F.R. Gouveia (1998)

2.5.1 Explicit Knowledge

According to Nonaka and Takeuchi (1995), there are two kinds of knowledge
explicit and tacit knowledge. Explicit knowledge can be expressed in words and
numbers and shared in the form of data, scientific formulae, product
specifications, manuals, instruction manuals, written procedures, best practices,
lessons learned, research findings and universal principles. This kind of
knowledge can be readily transmitted across individuals formally and
systematically (Edvinsson and Malone 1997). Nonaka and Takeuchi as cited in
Armstrong (2001), state that explicit knowledge can be codified; it is recorded
and is held in databases, corporate intranets and intellectual property portfolios.
The form in which explicit knowledge exists makes it possible for organisations to
transfer and share it so as to improve organisational performance.

The article further breaks down explicit knowledge into structured knowledge
whose data or information is organised for future retrieval, and unstructured

17
knowledge whose information is not referenced for retrieval. Examples of
structured knowledge include documents, databases and spread sheets, while
unstructured knowledge consists of e-mails, images, and training courses, audio
and video selections (www.nelh.nhs.uk/knowledge-management/km1/principles).

The World Development Report (1998) states that explicit knowledge refers to
the experience and know- how possessed by individuals that is captured and
explicated so that others can easily find it and understand and use it
(www.stevedenning.com/knowledge.htm). Explicit knowledge has a tangible
dimension that can be more easily captured, codified and communicated
(Nonaka and Takeuchi 1995). From the above discussions one can conclude that
explicit knowledge is tangible, discrete and is easily transferable.

2.5.2 Tacit Knowledge

Tacit knowledge is sometimes referred to as “know-how type knowledge” which
is an accumulation of experiences about how things are done, how problems can
be solved, what works and what does not and in what context and under what
conditions (Torrington et al 2005). It is highly personal and hard to formalise,
making it difficult to communicate or share with others. Subjective insights,
intuitions and hunches fall into this category of knowledge.

Tacit knowledge is deeply rooted in an individual's action and experience, as well

as in the ideals, values or emotions he or she embraces (Edvinsson and Malone
1997). Tacit knowledge is the knowledge that people carry in their heads, it is
more difficult to write down in a document or a database. The CUCSA Workforce
Evolution Work Group Report (2005-2006) further highlights difficulties in
capturing tacit as it is created through personal experiences and requires context
which the recipient of the information rarely has access to. The report suggests
that tacit knowledge is lost when long time employees retire or leave a situation

18
that may result in decreased efficiency, increased errors and lack of familiarity
with the application of policies and standards.

Edvinsson and Malone (1997), contend that inasmuch as the distinction between
tacit and explicit is useful to understanding knowledge, it provides little clue for
one to ascertain whether a given knowledge is actually tacit or explicit. The same
sentiments were echoed by Kogut and Zander (1993) who state that in some
cases, knowledge is not strictly polarised between the explicit-tacit dichotomies,
but exists along a continuum of tacitness and explicitness and thus conclude that
when examining the types of knowledge shared, the notion of the “degree of
explicitness” is more meaningful than the tacit-explicit dichotomy. Organisations
therefore need to put in place conditions that will facilitate the exploitation of tacit
knowledge from wherever it resides so that it is applied in the firms’ processes
and products and improve performance.

2.6 The Technology Factor

Technology plays an important role in facilitating knowledge sharing. Nosek
(1996) argues that organisational work demands completion of complex tasks by
distributed teams sometimes requiring intense collaboration and immediate
feedback. Information communication technology (ICT) provide effective and
efficient anytime, any place group support technologies for teams to engage in
the completion of complex tasks. ICT extends the reach of knowledge needed to
accomplish complex tasks and provides a means for collaboration.

Alavi and Leidner (2005) argue that traditionally knowledge creation and transfer
has occurred through various means such as face to face interactions,
mentoring, job rotations and staff development. However, as markets and
organisations become more global and move to virtual forms traditional means
may prove too slow and less effective and in need of being supplemented by
more efficient electronic means. Technology ensures that people work in an

19
interconnected environment that supports collaboration and information sharing
which important for the achievement of organisational goals.

2.7 Benefits of Managing Knowledge

According to Cheng (2002), there are a number of motivations that drive firms to
adopt a KM strategy which include among many others the need to retain key
talent, improving customer service, boosting innovation and promoting the
development of unique market offerings as well as increasing revenues and
profits. In this competitive knowledge economy, our most valuable asset is the
knowledge asset. It is often said that, in this economy it is not what "we own," but
“we know" that would give us the competitive advantage
(www.kwork.org/Whitepapers/).

O’Dell (2004) states that one of the driving forces for organisations to engage in
KM initiatives is the desire to increase responsiveness to customers, identify cost
redundancies, improve new product or service development, improve quality and
productivity of work and make better decisions. One of the other important
reasons why firms manage knowledge is the need to gain competitive advantage
that comes with improved or faster learning and new knowledge creation
(www.wikipedia).

20
Figure 2.5 below gives a summary of the benefits organisations can derive from
implementing. It shows that 78% of the businesses reported that they use KM
initiatives to capture and share best practices, 62% to provide training and
corporate learning, 58% to manage customer relationships, 56% to deliver
competitive intelligence.

5.5
Other
20.1
Enhance supply chain management
29.9
Enhance Web publishing
31.4
Manage legal, intellectual property
31.4
Provide project w orkspace
55.7
Deliver competitive intelligence
58.0
Manage customer relationships
62.4
Provide training, corporate learning
77.7
Capture and share best practices

0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0

Figure 2.5: Business uses of KM initiatives (Adapted from Dyer and

McDonough 2001)

Figure 2.5 above clearly shows that KM initiatives have the potential to improve
the performance of organisations. Organisations are able to capture and share
best practices, implement corporate learning, manage customer relationships
among many important functions.

21
Becerra- Fernandez (1999) states that the benefits of effective KM can be
realised through reduced mistakes, less redundancies, quicker problem solving,
better decision making, reduced research development costs, increased worker
independence, enhanced customer relations and improved service. Cheng
(2002) sums it all up by saying that there is only one major purpose for KM,
“adjusting quickly to the changing environment in order to boost efficiency and
enhance profitability”.

Organisational knowledge needs to be employed into a company’s products,

processes and services. If a firm fails to locate the right kind of knowledge in the
right form, it may find it difficult to sustain its competitive advantage (Bhatt
2000a). According to Kothuri (2002), the whole point of a knowledge
management system comes down to later applications. Thus, knowledge only
becomes useful when it is applied into the operations of the firm to improve its
performance.

Decision making is the most important, the toughest and riskiest job of
executives. KM facilitates quick decision making, be it corporate or operational
issues (www.knowledgeboard.com). Critical to any successful product
development process is having the right knowledge at the right time to make the
right decision. Knowledge about product design and producibility facilitates
informed decision making about when and how to proceed and reduces the risk
of costly design changes later in the product life cycle (www.fast.com.gov/kbdm.)

KM provides relevant information that is crucial to strategic management that

helps companies choose their line of products, manufacturing methods,
marketing techniques and other long term objectives. It also supports
management decisions by identifying and measuring the impact of alternative
decisions that potentially affects operations in all parts of the organisation.
Planning and decision making in operational and other recurring issues like

22
managing cash flow, budgeting, purchase of raw materials, production
scheduling and pricing are activities that require the management of knowledge
resources within an organisation (www.knowledgeboard.com).

Process efficiency results in business effectiveness. Thus organisations that

have effective KM practices are able to improve their business processes and
provide their organisations with an advantage of reduced process time and
reduced costs. The improvements could either be in terms of reduction in the
process steps involved in completion of an activity or by redesigning the existing
processes both of which could be achieved by having an effective KM system
Hult and Ketchen (2001). For instance IBM consultants managed to cut their
proposal writing time from an average of two hundred hours to thirty hours
through sharing of knowledge (www.knowledgeboard.com).

In service based organisations effective KM will result in improved service

through the introduction of KM systems. All parameters relating to service calls
are centrally recorded and codified as well as the impact of the problems. When
a service call or complaint is received service engineers could access this central
knowledge repository to find out if a similar call had been received in the past
and establish how it was handled. This results in the reduction of time spent in
rectifying the problem and as well reduce the service cost per call thereby
improve service capability (Cooke and Yanow 1993).

23
 CHAPTER 3

3 RESEARCH METHODOLOGY

3.1 Introduction
Research methodology is "the strategy or architectural design by which the
researcher maps out an approach to problem-finding or problem-solving" (Smith
and Dainty 1991). This section focuses on the appropriate research methodology
and research design that was used for the study (McPhail and Perry 2001).
Aspects to be discussed include the research framework, research design, the
research population, sampling and sampling techniques, sampling procedures,
data collection, data presentation, data analysis and research limitations. The
chapter gives an analysis of the methods used to collect primary and secondary
data in an attempt to address the requirements of the research question.

3.2 Research Framework

Research is defined as an investigation to discover new facts and reach new
conclusions by the critical study of a subject (Oxford Dictionary 2000). Smith and
Dainty (1991) describes research as a systematic, careful enquiry or examination
to discover new information or relationship and to expand or verify existing
knowledge for some specified purpose. Conceptually, it is an orderly search for
truth. Operationally, research is an orderly investigation of a defined problem,
using an appropriate scientific method or methods, to gather adequate and
representative evidence, producing conclusions drawn from logical reasoning
without bias, that can be validated, and yield general principles or laws that may
be applied in similar conditions. It is an organised, systematic, critical, objective
scientific enquiry into a specific problem (McPhail and Perry 2001).

24
3.3 Research Design
The research design is the action plan for the researcher to move from one
position to another (Yin 1994). Saunders, Lewis and Thornhill (1997) state that
research design is the methodology in which data is collected and analysed by
the researcher. It is a set of logical steps to be followed by the researcher in
answering research questions. Research design provides the glue that holds the
research processes together and provides a road map of what the researcher
has to do during the research process.

3.3.1 Qualitative Research

Qualitative research seeks in-depth, open ended responses. It aims at getting
respondents to speak freely about a chosen subject and obtain as wide as
possible a response.

3.3.2 Quantitative Research

This research design seeks structured and quantifiable responses. The approach
is descriptive in nature and usually presents the findings in numbers, figures or
statistical parameters. Quantitative research design uses structured research
instruments for data collection. The results provide less detail on behaviour,
attitudes and motivation and are based on larger sample sizes that are
representative of the population. This research design is highly reliable and
ensures that the research can be replicated. This study adopted a case study
approach and applied a quantitative research method for the collection and
analysis of data.

Quantitative research approach was considered relevant for the study because it
can be applied to a larger sample of the population. A questionnaire was
administered to collect primary data while desk study was used to collect
secondary data. This study adopted a survey research design that entailed use
of questionnaires and structured interviews. Surveys are the most commonly
used research techniques in business research. They were administered using

25
telephone interviews, face to face interviews and self administered
questionnaires (http://web.uni-frankfurt.de/fb05/psychologie). Survey research
gives the researcher control over the research process.

3.4 Population
The population is the aggregate of all elements under examination. Wegner
(2001) defines population as the collection of all observations of a random
variable under study and about which one is trying to draw conclusions in
practice. Harper (1991) suggests that the population refers to a group of people
or items about which the researcher wants to obtain information. It is the group
that the researcher is interested in studying and to which the findings of the
research will be generalised. The population was defined in terms of the
elements, sample units, time and size. The population selected in this study are
all employees of the four Building Societies in Zimbabwe.

3.5 Sampling and Sampling Techniques

According to Fowler (1984), it is not always practical to get data on every
observation in the population and as a result a subset all observations (sample)
is gathered on the random variable. A sample is a sub set of the population on
which observations are made or measurements taken. It is a group of people or
items taken from the population for examination. A sample must be drawn in
such a way that it is representative of the population.

The value of information obtained through research depends on how well a

sample represents the total population. Van der Walt, Strydom and Jooste (1996)
state that a sample that is not representative of the population may not give a
true picture of the population and may have problems of validity and reliability.
There are two types of sampling techniques which are probability sampling that
gives each element of the population an equal chance of being selected for the

26
study and non probability sampling which does not give each element an equal
chance of being selected to the sample (Wegner 2001).

3.5.1 Random Sampling

Random sampling is also referred to as probability sampling. All elements in a
population have an equal chance of being selected to the sample. It is regarded
as the best way of coming up with a representative sample. Probability sampling
includes, random sampling, stratified sampling and cluster sampling. (Saunders
et al 2003). Commonly used random sampling methods are simple random
sampling, stratified random sampling, cluster sampling and systematic sampling.

3.5.2 Sampling Methods used

Stratified random sampling was the method used in this research. In this method
the whole population was first divided into mutually exclusive sub groups or
strata and then units were selected randomly from each stratum. The segments
were based on some predetermined criteria such as Building Society name and
occupation for example managerial or clerical staff. It entailed the proportional
allocation of sample size to the each identified group. This attribute was
considered relevant to the study because it enabled the researcher to appreciate
views from both managerial and clerical staff on knowledge management
initiatives in their respective organisations. Stratified random sampling was used
because there was no defined sample frame. After the strata were established,
other sampling techniques such as simple random sampling were used to draw
sample units from each respective stratum.

27
The formula below was used in establishing the sample size:

N= (n*100)/ (re %): Where:

N is the actual sample size required
n is the minimum sample size
re% is the estimated response rate

The sample size from each of the Building Societies was calculated as:
(30*100)/50% = 60. However, due to costs involved in the production of
questionnaires the researcher deliberately reduced the sample size from each of
the Building Societies to 40. This number was not considered large enough to
avoid small sample bias which was the risk that the researcher may base his
findings on small samples that may not be representative of the population.

3.6 Data Collection

Brooking (1999), Armstrong (2001) and Ackoff (1989), define data as raw facts.
Ackoff went on further to explain that data has no significance beyond its
existence and it can exist in any form. This means that data is meaningless
unless it is processed. Data collection refers to the methods that the researcher
used to gather raw facts about the research problem. There are many methods
of collecting primary data (qualitative or quantitative) and these include:
questionnaires, interviews, focus group interviews, observation, case studies and
diaries but however the researcher used methods below:

3.6.1 Questionnaires
Questionnaires were a relatively cheap and easy way to administer data
collection. A choice of the questionnaire as a data collection tool was done
because it was very relevant to the survey research design. The use of the
questionnaire brought with it a number of advantages such as easy of
administration. It was a common instrument for collection of primary data. The

28
questionnaire was used to solicit for data from a large number of people and
organisations at once. It afforded the respondents time to think through their
responses while maintaining their possible anonymity and freedom to express
their own individual feelings without fear of being probed

However, questionnaires had a number of disadvantages that the researcher

encountered in using it as a data collection method as there was a low response
rate, responses were delayed, the researcher did not have control over who
actually completed it and incomplete questionnaires were returned to him. The
questionnaire was designed in such a way that questions were simple to improve
response rate.

In this study the researcher made sure that the questionnaire contained no
ambiguous questions through pre testing of the questionnaire. Since the
questionnaires were self administered it was important that all vague questions
be eliminated so as to improve the response rate.

The questionnaire used in this study was designed in such a way that it
contained both closed and open ended questions. Open ended questions were
important in that they gave the respondents an opportunity to express their own
views about the subject under investigation without being controlled as is the
case with closed ended questions.

Moreover, the questionnaire was of appropriate length as excessive size would

reduce the response rate. Thus the researcher ensured that all vague questions
were eliminated so as to keep the questionnaire within reasonable limits. A
covering letter was also attached to the questionnaire explaining purpose of
research and gave assurance to respondents that their answers would be treated
in strict confidence. As a gesture of appreciation the questionnaire finished with a
“Thank you”.

29
The questionnaire was divided into three sections; Section A containing
administration information, Section B both closed- ended questions and open-
ended questions. Closed ended questions were important in this study because
they directed respondents to issues that the researcher wanted to find out and by
so doing speeded up the process. The fact that they were placed at the
beginning of the questionnaire meant that respondents were motivated to answer
the questions as they were not required to think deeply about the topic under
study.

The use of questionnaires was not without its own challenges, completion and
analysis of data collected by the use of questionnaires was time consuming.
Some open–ended questions brought out unsolicited information and this may
cost the researcher time while trying to remove the grain from the chaff (Martins
at al 1996). In spite of the limitations of this instrument the questionnaire was
considered a relevant tool for this research since it involved participants in
different organisations. It was easy to obtain their views through the use of this
instrument as some questionnaires were mailed to them.

3.6.2 Interviews
Interviewing is a technique that was used to gain an understanding of the
underlying reasons and motivations for people’s attitudes, preferences and
behaviour. This research used structured interviews which were based on
carefully worded interview schedules frequently requiring short answers. They
were conducted personally on a one on one basis and in groups. Personal
interviews resulted in accurate information, high response rate, immediate
responses, control over respondents and clarification in problem areas. Motives
and feelings were investigated affording the interviewer an opportunity to assess
characteristics of the respondents, through assessing tone of voice, facial
expression and hesitation.

30
However, interviewing posed challenges to the researcher in that it was time
consuming, very expensive, had low geographical coverage, respondent bias
(tendency by respondent to impress or create false personal image).The
respondent felt embarrassed when asked personal questions and finally data
analysis posed some serious challenges as well. Interviewers had to undergo
intensive training to ensure that they ask questions in the same manner which
was very costly.

3.7 Data Presentation

The data was presented using tables and graphs. These methods were chosen
for this purpose because they facilitate easy comparison and understanding of
the information being presented. As the study was looking at four organisations
the use of bar graphs made it easy to compare the respondents’ view in each
aspect under investigation.

3.8 Data Analysis

Data was analysed using Microsoft Excel after being cleaned to remove
inconsistent responses.

3.9 Research Limitations

The organisations under investigation refused to be identified by names although
they agreed to participate in the study. The researcher was an attaché of one of
the Building Societies under investigation and as a result it was not easy to
obtain some information from other Building Societies for competitive reasons.

31
 CHAPTER 4

4 RESEARCH FINDINGS AND ANALYSIS

4.1 Introduction
This chapter presents an analysis of the findings of the research. Discussions will
be made on the research findings in relation to the literature that was reviewed in
Chapter 2. Different methods of statistical data presentations such as tables and
graphs will be used to present the data. These methods have been selected for
this purpose because they facilitate easy comparison and interpretation of the
data. The analysis will be based on the key areas that were covered by the
questionnaire that was distributed within the four Building Societies that are
subject to this research project. These areas are;

 Knowledge Creation
 Knowledge Sharing
 KM Success Factors
 Benefits of KM
 IT in KM
 Barriers to effective KM
 KM and Organisational Performance

Questions (both closed ended and open ended) were asked to solicit the
respondents’ views on each of the concepts listed above. Closed ended
questions were used because they direct the respondents to issues that the
researcher intended to investigate while open ended questions allowed the
respondents to give their own views concerning the subject under investigation.

32
4.2 Response Rate
A total of 160 questionnaires were distributed with each of the Building Societies
getting 40 questionnaires. The questionnaires were distributed to employees
irrespective of their positions within the organisation. This was done so as to get
responses from a cross section of the employees within each organisation.
Below is a summary of the response rate.

Table 5

Organisation Questionnaires Questionnaires Response Rate

Sent Returned (%)
Building Society A 40 38 95%
Building Society B 40 23 58%
Building Society C 40 27 68%
Building Society D 40 30 75%

The results show that the response rate was 95% for Building Society A, 58% for
Building Society B, 68% for Building Society C and 75% for Building Society D.
Building Society A recorded the highest response rate due to the fact that the
researcher is an employee of this organisation and as such is well known to the
respondents and it was also easy for him to make some follow ups on the
questionnaires. This was not the case with other Building Societies where the
response rate was below 80%. However, the response rate of 58%, 68% and
75% were considered high enough to carry out an objective assessment of the
respondents’ views about KM initiatives in their organisations.

The response rate can be analysed further to establish the number of

respondents according to their occupations within the organisation, that is
whether managerial or clerical. Such an analysis helps in establishing whether
managerial employees and clerical employees hold the same views with regards
the existence or non existence of KM practices within their organisations. Table

33
4.2 below shows the number of respondents by occupation in each of the
Building Societies under study.

Response rate by Occupation

Table 6
Organisation Clerical Managerial Response Rate Response Rate
Clerical (%) Managerial (%)
Building
Society A 21 17 55% 45%
Building
Society B 10 13 43% 57%
Building
Society C 8 19 30% 70%
Building
Society D 12 18 40% 60%

The results show that in Building Society A 55% of the respondents were clerical
employees while 45% were managerial, in Building Society B, 43% of the
respondents were clerical, 57% managerial, in Building Society C, 30% were
clerical and 70% managerial while in Building Society D 40% were clerical and
60% managerial.
The overall picture shows that managerial employees had a higher response rate
as compared to clerical employees. This can be attributed to the fact that
managerial employees by virtue of their educational background and position
within the organisation understood the concept of KM better than clerical
employees hence faced no difficulties in responding to the questionnaire.

The analysis of the research findings was done using bar graphs. Bar graphs
were chosen for this purpose because they facilitate easy comparison of
statistical data and enhance clarity. It was easy to compare how each of the

34
Building Societies fared in some of the KM concepts being investigated. It was
also easy to draw conclusions from the analysis of each of the KM concepts
listed above.

4.2.1 Knowledge Creation

Respondents were requested to give their own views as to what knowledge is.
The results show a divergent of views from the respondents. The definition of
knowledge was considered critical to the study because any effective KM
strategy should clearly define what knowledge is so as to come up with
appropriate strategies of managing it. The results of the survey are summarised
in Figure 4.1 below:

Definition of Knowledge

90
80
70
Frequency (%)

60 Information
50
Data
40
30 Skill
20
10
0
Building Building Building Building
Society A Society B Society C Society D
Organisation

Figure 2: Definition of Knowledge

The results show that the majority of the respondents understood the concept of
knowledge. In Building Society A, 85% of the respondents said knowledge is
information, 12% said knowledge refers to data while the remainder said

35
knowledge is the same as skill. In Building Society B, 65% indicated that
knowledge is information, 25% said it is data while 10% said knowledge is the
same as skill. In Building Society C, 58% of the respondents said that
knowledge refers to information, 30% said it is data and 12% said knowledge is
skill. About 68% of the respondents in Building Society D said knowledge is
information, 15% said knowledge is data while 17% of the respondents think it is
the same as skill.

a) How is knowledge created in your organisation?

Organisations can engage in many different activities that result in the creation of
knowledge. The respondents were requested to list the activities which results in
the creation of knowledge in their organisations. Figure 4.2 below gives a
summary of the findings:

Knowledge Creation Activities

90
80
70
Building Society A
Frequency (%)

60
50 Building Society B
40 Building Society C
30 Building Society D
20
10
0
Training Meetings Group
Discussions
Activity

Figure 3: Knowledge Creation Activities

The majority of the respondents indicated that training is one of the activities that
results in the creation of knowledge within their organisations. About 73% of the

36
respondents in Building Society A, 81% in B, 66% in C and 70% in D respectively
believe that training results in the creation of knowledge.

About 63% of the respondents in Building Society A, 56% in B, 58% in C and

48% in D stated that meetings also result in the creation of knowledge. However,
the majority of respondents in Building Society D (52%) think otherwise.

A further 67% of the respondents in Building Societies A, 62% in B, 43% in

Building Society C and 45% in Building Society D also pointed out that group
discussions lead to the creation of knowledge. About 33% of the respondents in
Building Society A, 38% in B, 57% in C and 55% in D believe otherwise.

These findings are very relevant to this study because an understanding of how
knowledge is created will result in organisations formulating policies which
promote these activities which is part of KM.

b) Do you know your organisation’s KM strategy?

The research intended to establish whether or not the respondents were aware
of their organisations’ KM strategy. Awareness of an organisation’s strategy is
very important if all stakeholders are to work towards achieving the same
objectives. The findings of the study are summarised in Figure 4.3 below:

37
 Knowlege of the Organisation's KM Strategy

70

60
Frequency (% )

50

40 Yes
30 No

20
10

0
Building Building Building Building
Society A Society B Society C Society D
Organisation

Figure 4 Knowledge of the Organisation’s KM Strategy

The results show that 55% of the respondents in Building Society A, 50% in B,
40% in C and 45% in D reported that they were aware of their organisations’ KM
strategy. However, 45% of the respondents in Building Society A, 50% in B, 60%
in C and 55% in D were not aware of their organisations’ KM strategy. This may
be an indication to the fact that either the KM strategy does not exist or if it does,
it is not well communicated.

c) State your Organisation’s KM strategy

The study sought to establish whether the respondents who indicated that they
were aware of the KM strategy could remember the key words in their KM
strategy. The findings listed below are the most consistent views from the
respondents:

 Continuous improvement
 Creativity

38
  Innovation
 Knowledge retention
 Knowledge sharing

d) Does your organisation support Continuous Learning?

An organisation that has adopted a “people centred” approach to KM is expected
to have support mechanisms in place that facilitate the acquisition and flow and
exchange of knowledge within the organisation. The questionnaire sought to
establish the existence or non existence of such support schemes within the
organisations under investigation. The findings are shown below:

Support For Continuous Learning

120
100
Frequency (%)

80
Yes
60
No
40
20
0
Building Building Building Building
Society A Society B Society C Society D
Organisation

Figure 5: Organisational Support for Continuous Learning

About 95% of the respondents in Building Society A, 80% in B, 75% in C and

77% in D reported that their organisations support continuous learning. However,
5% of the respondents in Building Society A, 20% in B, 25% in C and 23% in D
said there is no support for continuous learning in their organisations.

39
 e) How does your Organisation Support Continuous Learning?
The question was meant to establish the forms of support that Building Societies
have in place that show their commitment to continuous learning. The answers to
this question were wide and varied. However, the most common ones among the
four Building Societies are shown below:

 Educational sponsorships
 In house workshops
 Sponsorship for external workshops
 Rewards for successful completion of selected courses.

f) How is Knowledge retained in your Organisation ?

Organisations need to retain knowledge so as sustain their competitive
advantages. The questionnaire requested the respondents to state the various
ways through their organisations retain knowledge. The respondents identified
three ways through which their organisations retain knowledge which are:
databases, documentation and written procedures. Figure 4.5 gives a summary
of the research findings.

40
 Knowledge Retention

90
80
Frequency (% )

70
60 Database
50
Documents
40
30 Written Procedures
20
10
0
Building Building Building Building
Society A Society B Society C Society D
Organisation

Figure 6: Knowledge Retention

The results show that about 60% of the respondents in Building Society A, 68%
in B, 70% in C and 73% in D identified databases as one of the ways through
which knowledge is retained in their organisations.

A further 74% of the respondents in Building Society A, 50% in B, 60% in C and

55% in D also reported that their organisations keep knowledge in the form of
documents.

In addition, 56% of the respondents in Building Society A, 78% in B, 68% in C

and 66% in D reported that knowledge is also retained in the form of written
procedures.

4.2.2 Knowledge Sharing

Knowledge sharing is an important component of an effective KM strategy. The
research questionnaire contained questions that were intended to establish the
extent to which knowledge is shared within their organisations. The respondents
were also requested to state how knowledge is shared in their organisations.

41
 a) How is knowledge shared in your organisation?
The respondents were requested to list the various ways through which
knowledge is shared within their organisations. The following were listed as
channels through which knowledge is shared within Building Societies in
Zimbabwe.

 E-mails
 Memoranda
 Social interaction
 Attending training programmes
 Meetings

b) State the types of knowledge that is shared in your organisations?

Knowledge can be categorised into various groups depending on what it is used
for. The respondents were asked to list the categories of knowledge that they
share in their organisations. Their views are outlined below:

 Knowledge about competition,

 Products and services,
 New technology
 Business opportunities

c) Benefits of Knowledge Sharing

Organisations derive several benefits from the effective knowledge sharing.
Employees in organisations share knowledge so as to achieve specific
outcomes. The respondents were asked to state the benefits that are associated
with knowledge sharing in their organisations. Below is a list of what they
identified as some of the benefits of knowledge sharing to the organisation.

 Sharing of experiences

42
  Promotes innovation
 Improvements in organisational efficiencies
 Value creation

4.2.3 Barriers to Knowledge Management

The existence or non existence of certain conditions within organisations can
impact on the ability of organisational members to share knowledge. The study
sought to establish the existence of such barriers within the Building Societies in
Zimbabwe. An understanding of the barriers to knowledge sharing is important as
it also has implications on organisational performance if knowledge is not shared.
The respondents identified the following conditions as major impediments to
knowledge sharing.

 Lack of trust
 Fear of losing control
 Lack of supportive organisational culture
 The belief that knowledge is power
 Lack of incentives for sharing

4.2.4 KM Success Factors

A successful KM strategy depends on a number of factors that either hinder or
stir KM initiatives. This section looked at the existence or non existence in
Building Societies in Zimbabwe of a number of factors that have been identified
in literature by different authors as having an effect on the success or failure of
KM in organisations.

43
 a) List KM success factors in your organisation
Certain conditions are necessary for the effective implementation of successful
KM practices. Divergent views were given to this question and the most common
factors that were identified are listed below.

 Top management support

 Supportive organisational culture
 Communication
 Trust

b) Recognition for knowledge contribution

The question was meant to establish the extent to which Building Societies in
Zimbabwe acknowledge employees’ contributions towards KM. Recognition
spurs performance and motivates employees to work towards achieving the
organisation’s performance objectives. The findings of the study are listed
below:

 Rewards
 Publication of names of contributors in the organisation’s in house
magazine
 Hosting public events to reward contributors
 Tokens of appreciation such as T-Shirts and hats

4.2.5 Benefits of KM
Organisations implement strategies that are meant to produce results that are in
line with their goals. The study sought to establish the respondents’ views on
whether or not their organisations derive benefits from managing knowledge.
Different responses were received and the most common are outlined below:

 Understanding the customers’ needs

44
  Developing new products and services
 Knowing what competitors are doing
 Managing relationships with suppliers
 Organisational learning
 Sharing best practices

4.2.6 Information Technology (IT) in KM

Many organisations have invested in IT infrastructure as part of their KM
strategy. The study sought to establish the extent to which Building Societies in
Zimbabwe have implemented IT related strategies to manage knowledge.
Respondents were asked to state how IT is being used in their organisations’ KM
initiatives. The results of the survey are outlined below.

 Capturing knowledge
 Communication
 Storage of knowledge
 Transferring knowledge from one section to another
 Knowledge sharing

Technology provides for the transfer of knowledge that is codified and packaged
into formats that allow its transmission to others (Schulz and Jobe 2001).
Hariharan (2002) states that technology provides the functionality that supports
knowledge sharing, collaboration, workflow and document management across
the enterprise. According to Cooke and Yanow (1993) knowledge may be in part
a codifiable commodity which can be stored and accessed in databases. In this
case IT supported KM systems act as organisational memory that exceeds
individual cognitive constraints.

45
4.2.7 KM and Organisational Performance
Respondents were asked to indicate whether or not KM has implications on the
performance of their organisations. The results of the study are summarised in
Figure 4.6 below:

46
 KM and Organisational Performance

100
90
Frequency (% )

80
70
60
Yes
50
No
40
30
20
10
0
Building Building Building Building
Society A Society B Society C Society D
Organisation

Figure 7: KM and Organisational Performance

The results show that about 94% of the respondents in Building Society A, 48%
in B, 43% in C and 63% in D reported that KM stirs organisational performance.
However, 6% in Building Society A, 52% in B, 57% in C and 37% in D thought
otherwise.

Contribution of KM to Organisational Performance

Respondents were requested to indicate how KM has contributed to the
performance of their organisations in the last two years. Respondents gave
various views. Below is a list of the most consistent views that were given.

 Customer satisfaction
 Increased profits
 Introduction of New products and services
 Increased market share
 Increased sales

47
The findings of the study concur with Cheng (2000) who states that KM results in
improved customer service, boosts innovation, promotes the development of
unique market offerings as well as increasing revenues and profits. He further
highlighted that KM is critical to any successful product development process and
enables organisations to develop unique offerings retain key talent and improve
customer service.

Research Proposition: Knowledge Management practices have

implications on organisational performance.
The financial performance of the four Building Societies analysed in chapter one
shows that Building Society A performed better during the period 2006 to 2007
both in terms of revenue generation and cost to income ratios. Building Society B
comes in second followed by C and D respectively.

The findings of the study also show that Building Society A tops in some of the
aspects that were measured such as understanding of what knowledge is, how
knowledge is created, awareness of the organisation’s KM strategy, support for
continuous learning and how KM has impacted on the performance of their
organisation in the last two years. To this end it can be said that KM has
implications on organisational performance.

48
 CHAPTER 5

5 Summary, Recommendations and Conclusions

5.1 Introduction

This chapter focuses on the summary, conclusions and recommendations that

are drawn from the research findings. It will establish the extent to which the
objectives of the study would have been addressed and will prove or disapprove
the research proposition. A set of recommendations will be given which the
organisations that are subject of the research can adopt to improve their current
KM practices.

5.2 Conclusions
The study was motivated by the need to establish whether KM has implications
on organisational performance. In trying to achieve this main objective an enquiry
was made into the knowledge creating activities of these organisations,
knowledge sharing, benefits of KM to organisations, barriers to KM, KM success
factors and the role of IT in KM practices.

There is a high level of awareness among the Building Societies in Zimbabwe of

the need to manage knowledge and as a result they have put in place policies,
procedures that support knowledge creating activities such as training, meetings
and group discussions. However, there is no consensus on whether group
discussions and meetings are knowledge creating activities. The Building
Societies support continuous learning and do sponsor educational programmes,

49
in house workshops and give rewards on successful completion of selected
courses.

Knowledge is widely shared within these organisations and IT has facilitated the
transfer and sharing of knowledge across the organisations and between
individuals and groups. This has made it possible for the incorporation of
knowledge into various activities such as new product developments which is
critical to organisational performance. However, there are still barriers to
knowledge sharing such as lack of trust, fear of losing control, lack of supportive
organisational cultures, the belief that knowledge is power as well as the lack of
rewards and recognition for knowledge contributions. These factors were
identified as some of the factors that are currently militating against knowledge
sharing.

Generally, there is consensus that Building Societies derive a lot of benefits

through managing knowledge. The results of the study show that the
respondents believe their organisations have acquired sustainable competitive
advantage, have launched new products and services, and customer satisfaction
through the exploitation of knowledge which ultimately has resulted in them
improving their performance.

The findings of the study show that Building Societies in Zimbabwe have not
implemented Talent Management and Graduate Traineeship Programmes as
part of their KM practices. Staff retention was not mentioned as one of the ways
through which knowledge is retained. This is in contradiction to the views of
Drucker (2003) who states that knowledge resides between two ears.

None of the respondents stated that they share knowledge about the state of the
economy. An understanding of the economic environment is very important for
organisations and therefore employees need to share such information so that
strategies they formulate attempt to address some of the economic challenges.

50
The organisational structure has implications on KM practices within
organisations. None of the respondents identified “organisational structure” as
one of the barriers to effective knowledge sharing. The structure of an
organisation affects the flow of information and may result in the creation of
“information silos”.

Communication was not identified as being one of the most important KM

success factors. This means that there are communication gaps within the
Building Societies and this often leads to execution gaps if strategy is not shared
across the organisation.

Organisational culture is another important aspect that determines the success of

all organisational strategies. The respondents did not identify culture as one of
the factors that impedes transfer of knowledge within the organisation and
prevents knowledge from cascading down to other sections of the organisations.

The study proposition that “Knowledge Management practices have implications

on organisational performance in Building Societies in Zimbabwe” has been
accepted. Most respondents generally agreed that their organisations have
implemented KM practices that have contributed to the performance of their
organisations.

5.3 Recommendations

The following recommendations are made:

1. Building Societies in Zimbabwe should consider incorporating Talent

Management and Graduate Traineeship Programmes into their KM
strategies so as to capture, develop and retain available knowledge
resources.

51
 2. Building Societies are advised to adopt flat organisational structures so as
to facilitate the flow and transfer of knowledge across all sections of the
organisations.

3. Building Societies in Zimbabwe need to adopt cultures that are consistent

with best practice organisations that will have a positive impact on
continuous internal communication, organisational participation and
involvement, teamwork and innovation.

4. Building Societies in Zimbabwe need to deploy KM practices into internal

process improvements so as to improve organisational efficiencies as well
as their responsiveness to customer needs.

5. Building Societies in Zimbabwe need to implement KM strategies that

clearly state what knowledge is to be shared, how it is to be shared, with
whom it is to be shared and why it is to be shared. By so doing their
employees can clearly see how KM contributes to the performance of their
organisations.

6. Building Societies need to encourage the development of communities of

practice where experts meet and share best practices.

5.4 Areas of Further Research

The study recommends that further research be carried out to establish whether
there is a correlation between KM practices and organisational performance.

52
APPENDIX

QUESTIONNAIRE

An investigation to establish if Knowledge Management has

implications on organisational performance. A case study of
Building Societies in Zimbabwe for the period (2005-2007)

Error: Reference source not found

Good Morning/ Afternoon. The following questions seek to get your opinion on
whether your company has adopted Knowledge Management and its implications
on organisational performance. This research is being conducted in partial
fulfilment of a Bachelor of Business Studies Honours Degree in Human Resource
Management (BBSHRM) being undertaken by the researcher, Shadreck
Chigango, a student from Bindura University of Science Education. Your
individual responses will be held confidential and shall ONLY be made known to
the researcher and his University supervisor strictly for academic purposes only.
Please note that there is no right or wrong answers as all responses shall be very
material to the study. Thank you very much in advance for giving your time to
complete this questionnaire.

Section A:

1. Knowledge Creation

a) What do you think Knowledge is?.................................................................

..........................................................................................................................
............................................................................................................................
............................................................................................................................
b) How is knowledge created in your organisation?..........................................
............................................................................................................................
............................................................................................................................

53
c) Do you know your organisation’s Knowledge Management strategy?
 Yes
 No

d) How does your organisation support continuous learning?

......................................................................................................................
......................................................................................................................
......................................................................................................................
...................................................................................................................
e) How is knowledge retained in your Organisation?
......................................................................................................................
......................................................................................................................
...................................................................................................................

Section B
2. Knowledge Sharing
a) How is Knowledge shared in your organisation?
......................................................................................................................
......................................................................................................................
..............................................................................................................
b) State the types of knowledge that is shared in your Organisation?
......................................................................................................................
......................................................................................................................
......................................................................................................................
c) What do your organisation benefits from Knowledge Sharing?
......................................................................................................................
......................................................................................................................
................................................................................................................

54
 Section C
3. Barriers to Knowledge Management and Knowledge
Management Success Factors
a) What conditions do you think might be hindering Knowledge Sharing in
your organisation?
......................................................................................................................
......................................................................................................................
......................................................................................................................
......................................................................................................................
......................................................................................................................
b) List Knowledge Management success factors in your Organisation
......................................................................................................................
......................................................................................................................
......................................................................................................................
...............................................................................................................
c) In what ways do your organisation recognise employee contribution
......................................................................................................................
......................................................................................................................
......................................................................................................................

55
56
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