Chapter Overview
This chapter provides a clear and comprehensive understanding of the study. The study background, the research purposes, the research questions, the study’s significance, its delimitations and limitations, and definition of the key terms are addressed.
Background of the Study
Knowledge is the major determinant of organizational competitive advantage and sustained grow, while knowledge management plays a key role in enhancing the competitiveness of the organization. It is to say that the main purpose of enterprise knowledge management is to assist organizations in accessing and reusing existing knowledge for improving their processes (O'Leary, 1998). Recently, knowledge management put more emphasis on socio-cognitive approaches, in order to motivate behavior that would help in promoting knowledge sharing in the organization (Chow & Chan, 2008). According to Renzl (2008), the importance of interpersonal trust in general and trust in management on knowledge sharing among many factors that may have influence on knowledge management. Besides, numerous researchers have explored the relationship between trust and knowledge management (J. H. Cheng, Yeh, & Tu, 2008; Chow & Chan, 2008; Fang & Chiu, 2010; Ho, Kuo, & Lin, 2012; Holste & Fields, 2010; Hsu & Chang, 2012; C. H. Lee, Huang, Barnes, &
Kao, 2010; Luna-Reyes, Black, Cresswell, & Pardo, 2008; Mooradian, Renzl, & Matzler, 2006;
Renzl, 2008; Staples & Webster, 2008; Usoro, Sharratt, Tsui, & Shekhar, 2007; W. L. Wu, Lin, Hsu, & Yeh, 2009; W. Y. Wu & Sukoco, 2010), and trusting relationships lead to greater
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knowledge exchange (Doney & Cannon, 1997), since trust in relationship may enhance interpersonal knowledge sharing and learning by reducing fear of losing one’s value (Renzl, 2008).
Firms are shifting from being product-centric to customer-centric, making customers as a part of the organization (Jackie, 2000), since customers are the core concept of relationship management, on account of the purchasing of goods and services can provide firms income (L.
Y. Cheng, Yang, & Teng, 2013). Customer relationship management (CRM) is about managing customer knowledge in order to better understand and serve the customers (Bose & Sugumaran, 2003). Fan and Ku (2010) indicated that from a strategic perspective, customer relationship management is not only providing an information technology solution and building the customer information database, more importantly, CRM is an organization process which enables an organization to measure its customer equity as well as manage customer relationships for the purpose of improving the organization’s profitability. Fan and Ku also asserted that there is an increasing focus on the issue of knowledge sharing and CRM. Besides, Ingram and Simons (2002) have researched into knowledge-enabled CRM, while Bose and Sugumaran (2003) have provided insight to the integration of knowledge management and CRM.
In the new epoch of knowledge economy, organizations have experienced ever-rising intense competition. According to Lisboa, Skarmeas, and Lages (2011), innovation is essential for the success, survival and renewal of organizations, especially in fast-paced or competitive markets, since focusing on firm innovation capabilities has positive influence on the process of translating innovative ideas into practice forth improving performance (Y. C. Wu, Lin, &
Chen, 2013). In accordance with the existing research, innovation is highly dependent on knowledge management (Gurkov, 2011), and continuous effective management of knowledge
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can promote organizational innovation and successes (Nonaka & Takeuchi, 1995). Moreover, positive knowledge sharing is considered as the most basic precondition for organizational innovation (Zack, 1999). Drucker (1993) also asserted that long-term competitive success requires an organization to generate knowledge as well as apply it in the form of innovation.
Besides, Liao, Fei, and Chen (2007) highlight that knowledge is a key in achieving continuous innovation, as a result, we can claim that innovation and knowledge are highly related.
There are already existing researches related to knowledge management in various industries under different geographical context, however, there is no specific study under the context of human resource industry in Taiwan. The reasons for choosing Pan Asia Human Resources Consulting Company as the target case company are because it is not only the leading human resources companies with the most comprehensive departments covering all spheres of human resources management and development which can be rated as complete HR services in Taiwan, but also the first human resources company nationwide that obtained ISO 9000 Quality Management Systems Certification. Pan Asia is based in Taiwan, and has already become a multinational human resources organization. For the competitive advantages of Pan Asia, it considers trust as its core value of the company, and focusing on both innovation and customer service in response to the dynamic changes of the environment and different customers’ needs.
Besides, existing research has focused on modeling various factors under investigation as precursors or independent variables which may affect the knowledge sharing (J. H. Cheng et al., 2008), however, these models do not consider serial effect of trust on knowledge sharing, customer relationship management, and innovation capabilities. In this study, the researcher attempt to bridge the gap based on the existing relevant research, developing an integrated
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model, which incorporates the influence of trust on knowledge sharing, customer relationship management, and innovation capabilities.
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Purpose of the Study
In the epoch of knowledge economy, knowledge has become the critical resources of economic growth, social development and growth of the enterprises. The rapid changes in technology and product market greatly influence firm operations, consequently, all firms must seek ways to maintain their competitive advantage and to enlarge their market share (Y. C. Wu et al., 2013).This research intends to expand on Taiwan’s knowledge management study, and to overcome the lack of research on assessing trust on knowledge sharing, customer relationship management, and innovation capabilities for human resource industry in Taiwan.
The main purpose of the study is to build an integrated model to measure effect of trust on knowledge sharing, on customer relationship management, and on innovation capabilities by using Partial Least Squares (PLS) method.
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Research Questions
Deriving from the research purposes, the research questions are formulated as follows:
1. Does trust (with variables trust in peers, and trust in management) have effect on knowledge sharing (with variables intra-groups, and inter-groups)?
2. Does knowledge sharing (with variables intra-groups, and inter-groups) have effect on customer relationship management (with variables win-back management, production/service customization, customer information management, referrals management, expansion management, and termination management)?
3. Does knowledge sharing (with variables intra-groups, and inter-groups) have effect on innovation capabilities (with variables product innovation, process innovation, and management innovation)?
4. What are the path parameter of trust on knowledge sharing, knowledge sharing on customer relationship management, and knowledge sharing on innovation capabilities, and the total effect of this integrated model?
Significance of the Study
Numerous studies focused on the relationship between trust and knowledge sharing (J. H.
Cheng et al., 2008; Chow & Chan, 2008; Fang & Chiu, 2010; Ho et al., 2012; Holste & Fields, 2010; Hsu & Chang, 2012; Hsu, Ju, Yen, & Chang, 2007; C. H. Lee et al., 2010; Luna-Reyes et al., 2008; Mooradian et al., 2006; Renzl, 2008; Staples & Webster, 2008; Usoro et al., 2007;
W. Y. Wu & Sukoco, 2010), while others have focused on the relationship between knowledge sharing and innovation capabilities (Liao et al., 2007; H.-F. Lin, 2007; Z. G. Liu & Cui, 2012;
Zhu, Wang, & Lan, 2007). However, researchers and practitioners have not tried an integrative model that examined the relationships among trust, knowledge sharing, customer relationship management, and innovation capabilities.
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To fill the gap, this study develops an integrated research model (the TKICC Model) that links trust, knowledge sharing, customer relationship management, and innovation capabilities together. The study examines the influence of trust (trust in peers, and trust in management), and knowledge sharing (intra-groups, and inter-groups) on customer relationship management (with variables win-back management, production/service customization, customer information management, referrals management, expansion management, and termination management), and innovation capabilities (product innovation, process innovation, and management innovation), and whether leads to superior innovation capability.
This exploratory empirical study is one of the preliminary studies to explore and assess the serial link of trust with knowledge management impact on human resource industry.
Furthermore, recommendations will be provided to firm’s decision makers and practitioners to enhance their innovation capabilities. The results of findings may provide reference for future research as well.
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Definition of Key Terms
The following section describes the definition of variables in this study: trust, knowledge sharing, customer relationship management, and innovation capabilities.
Trust
Trust is the quantified belief by a trustor with respect to the competence, honesty, security and dependability of a trustee within a specified context. Quantification reflects that a trustor can have various degrees of trust, which could be expressed as a numerical range or as a simple classification such as low, medium or high (O'Leary, 1998, p. 93).
Knowledge Sharing
Knowledge sharing is defined as the provision or receipt of task information, know-how, and feedback regarding a product or procedure (Hansen, 1999). According to Cummings (2004), knowledge sharing behaviors are divided into intra-group knowledge sharing (exchange of general overviews, specific requirements, analytical techniques, progress reports, and results among members), and inter-group knowledge sharing (exchange of general overviews, specific requirements, analytical techniques, progress reports, and results with other division members, non-division members, or customers) .
Customer Relationship Management
CRM is the building of a customer-oriented culture by which a strategy is created for acquiring, enhancing the profitability of, and retaining customers, that is enabled by an IT application; for achieving mutual benefits for both the organization and the customers (Rababah, Mohd, & Ibrahim, 2010). CRM processes are including win-back management,
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production/ service customization, customer information management, referrals management, expansion management, and termination management (Ö ztaysi, Sezgin, & Ö zok, 2011).
Innovation Capabilities
Samson (1991) classifies innovation into three categories: product innovation, process innovation, and managerial and systems innovation. According to Samson’s concept of innovation categories, Tsai, Huang, and Kao (2001) defines a firm’s innovation capability including product innovation, process innovation, and managerial innovation.
The definition of product innovation is that a company can provide differentiated or new products/ services in the market in order to obtain satisfaction from their customers. Therefore, product improvement and new product development which can satisfy customers is the foundation of product innovation. Besides, the definition of process innovation is a process that a company can offer a better manufacture or service process than current operation for the purpose of achieving better performance. Management innovation is defined as a capability which improves a company’s performance by implementing new managerial regulations, systems, and methods etc.
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Delimitations and Limitations
Limiting the scope is necessary to facilitate a more manageable research process, and make the research more feasible.
Delimitations
1. The study is delimited to Taiwan.
2. The study is delimited to human resource industry.
3. The study is delimited to language translation between Mandarin and English.
4. The study will explore the relationship among variables of trust, knowledge sharing, customer relationship management, and innovation capabilities only.
Limitations
1. The sample will only include employees of one firm in human resource industry in Taiwan. As a result, the generalization of the findings to another population might be limited.
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