Impact of Organizational Culture on Knowledge Management

Published: 2021-06-23
1736 words
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15 min to read
University of Richmond
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Dissertation chapter
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A healthy organizational culture enhances communication, increased employee participation, reduction of time spent on solving problems, faster delivery of cost-effective projects, and above all organizational efficiency. Other than these factors, a good corporate culture aligns an organization to knowledge management goals through creating a healthy environment to foster knowledge creation, sharing, and learning.

Knowledge sharing within an organization is essential because it facilitates the transfer of knowledge. An organization culture that encourages information sharing is imperative in ensuring that the knowledge management initiatives work. Therefore, organizational leaders and managers are tasked with understanding the organizational culture as a tool to guarantee the success of knowledge management practices. Their involvement and streamlining of the knowledge management process improves the knowledge sharing processes within an organization (Alavi, Kayworth & Leidner, 2005). Different types of organizational cultures influence knowledge management practices. In power driven organization culture, for instance, the use of knowledge management practices is encouraged in knowledge sharing. Some of the knowledge technologies and techniques used in power driven organization culture include knowledge workshops to enhance learning, networking, storytelling, benchmarking, mentorship programs, and expert directories. Although these techniques are originally used to create and codify knowledge, they are used in this concept to encourage knowledge sharing in the organization. Support of these techniques from the management and leadership encourages effective deployment in the organization. In bureaucratic cultures, on the other hand, there are clear lines of authority which may inhibit free knowledge sharing because they are hierarchical. Additionally, innovative cultures create an environment that encourages creativity and risk-taking. In most cases, knowledge sharing and creation in these cultures are highly encouraged.

Therefore, organizational culture influences knowledge management through its impact on the values employees attribute to the individual and cooperative behavior. The individual success of the KM approach is measured through attributes such as innovation or employees attitude towards the KM approaches. A good attitude is likely to increase the success rate of KM approach while a bad attitude is likely to hinder its implementation (Digan, 2015). Moreover, employees creativity and innovation are likely to determine whether a KM approach adopted by an organization will be successful or not. Cooperative behavior, on the other hand, fosters team spirit within the organization and its role in the implementation of KM strategies cannot be underestimated. Team spirit and cooperation creates an environment that facilitates knowledge sharing among employees irrespective of their job positions.

Moreover, OC plays a major role in knowledge reuse in KM management. Knowledge reuse involves knowledge producer, intermediary, and consumer. The three roles are essential in creating, preparing, and reusing knowledge within an organization. The main elements in knowledge re-use are cost and culture. The reuse situations include shared work practitioners, shared work producers, expert seeking novices, and miners of secondary knowledge.

Furthermore, in knowledge creation emphasis is placed on knowledge sharing, collaboration, access to the relevant data and information. It involves putting the acquired knowledge into practice to enable knowledge sharing and create a suitable work environment that encourages experimentation and trial and error (Du, 2006). Moreover, self-organizing teams are identified as a useful tool towards successful integration of KM practices. Collaborative IT systems that support the ideal work environment and provide access to relevant data and information are put in place to encourage creativity and innovation.

Moreover, organizational culture creates an environment that encourages the growth of KM initiative. Organizations do not decide to adopt an approach to KM before hand, but they evolve. The process plays a critical role because it enables an organization to align the initiative with the existing organizational strategies (Davel & Snyman, 2005). In a corporate culture that encourages innovation, the formation of communities that evolve over time to reflect the values of the organization KM is embedded in the organizational culture. The communities become part of the culture and provide a sense of belonging. This is because the communities become a representative of individuals value system and hence part of the organizational culture.

Reserve Bank of New Zealand Case Study

The Reserve Bank of New Zealand serves as the nations central bank. It is a unique entity such that it not awarded the recruitment opportunities available to the organizations in the prolific industry. Furthermore, the average lifetime of staff members in the bank is nine years which means that upon their departure there is a significant loss of knowledge which creates a risk to the organization. To respond to this risk, the reserve bank has begun an extensive knowledge management program (Jennex, 2005). The KM program matches with the organizations mission which is to build the national and international confidence in the countrys stability and integrity of the currency. Moreover, the mission aligns with the primary responsibilities of the Bank which are to promote and maintain a sound financial system, meet the peoples currency needs, and operate the monetary policy to achieve and maintain price stability.

The Management Structure

The bank's management structure is hierarchical. On the top is the governor who is appointed by the Minister of Finance on the recommendation of the board of directors. The governors term is five years, and he or she is accountable for all the decision-making in the bank. The board of directors are about 7-10 executive members whose role is to review the performance of the governor and the bank and provide their feedback to the minister of finance. Moreover, the bank has several internal committees that are tasked with advising the governors. Additionally, the bank has nine departments which are led by the departmental heads. The governor, the deputy governor, the board of directors, the internal committees, and the departmental heads form the senior management team of the bank.

Case Description

Due to the nature of work at the bank, a range of specialist skills are required. The specialist skills are not easy to master over a short period making employee loss a high risk in the organization. Moreover, finding the combination of correct specialty skills is difficult because a country has only one central bank. This means that there are no large groups of individuals possessing these skills. Moreover, considering that recruitment was limited to the global pool of specialty skills around the world, the bank realized the need to minimize the loss of knowledge through the appropriate KM strategies (Jennex, 2005). Therefore, the bank took several initiatives to build an appropriate KM strategy that could meet the organizational needs. Although the advantages of a good KM strategy could not be underrated, the bank did not know where to begin to build a framework. Therefore, to cater for the lack of information, the bank began by gaining the understanding of KM. The understanding was essential in investigating the best practices in the globe and determining which strategy could work best to suit the needs of the organization. Upon determining which approach would work best, the bank resulted to hiring an individual with knowledge of KM practices and how they were being implemented in the outside world. However, an outside individual was a concern to the bank due to the information they would disseminate to him to enable him to formulate a workable strategy. To resolve these issue, the bank sought an individual through whom they could gain access to established networks and different organizations. Therefore, the bank was able to harness a great deal of information which they used to inform their KM strategy. The main objective was to build, nurture, and exploit knowledge assets through systems, processes, and people and convert them into a valuable knowledge based services and products. Therefore, to realize this strategy, the bank undertook a 12-week program that developed a workable strategy to establish KM initiatives.

The most significant knowledge management imitative of the bank was aimed at changing the organizational culture. To make this change possible, the band incorporated the concept of leadership by example because shaping the organization's culture was essential to its ability to manage its knowledge effectively. One aspect that was identified as critical was vision presented from top management. The vision required support from everyone within the organization to ensure its success. Communication across the different departments of the bank facilitated the process. Due to the small number of employees at the bank, communication was easier and sustainable (Jennex, 2005). Furthermore, Knowledge management initiatives were identified as a core competency for the managers. Moreover, it was essential to the appraisal process which enhanced leadership role and embedded knowledge management into the organizational culture. Under performance appraisal, knowledge sharing was broken into multiple statements. The employees measured themselves on where they were on a scale of one to five. Number one needed a lot of development concerning knowing sharing while number five was considerable okay. The assessment method prompted the staff to rethink their knowledge sharing abilities within the organization. This assessment was measured through networking or documentation.

Secondly, increasing the opportunities for collaboration was adopted with the aim of changing the organizational culture. Before the beginning of this strategy, the bank had begun adopting an open plan type of office for all employees other than the chief executive and deputy chief executive. The initial aim of the move was not knowledge sharing, but as employees began to embrace it, communication became more efficient. Proper communication enhances knowledge sharing in an organization. Moreover, KM strategy became an important aspect of the recruitment program of the bank. It was used during the hiring process to capture interesting facts on KM from the candidates and determine their approach.

Lessons Learned From the Case Study

The first lesson that was learned from the case study was that knowledge management was not a project rather it was a continuum. It is intrinsic to both individual and organizational culture. It refers to the way one works incorporating different aspects of the organization.KM practices are integrated into the daily activities of the organization to increase their rate of success.

Secondly, KM practices require high levels of commitment from within the organization to enhance knowledge sharing. Support from the top management allows the right level of autonomy that enhances growth. This is more practical in a hierarchical structure that a flat structure.

Moreover, the case study indicates that the benefits of KM are intangible and hard to quantify. They portray themselves through different organizational aspects and in most cases the benefits are intangible. For instance, knowledge sharing improves employee performance which is an intangible aspect and hard to quantify. However, the performance can be felt through other...

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