Knowledge leadership to improve project and organizational performance
Li-Ren Yang
a,⁎
, Chung-Fah Huang
b, Ting-Jui Hsu
aaDepartment of Business Administration, Tamkang University, New Taipei City, Taiwan
bDepartment of Civil Engineering, National Kaohsiung University of Applied Sciences, Kaohsiung, 807, Taiwan
Received 30 August 2012; received in revised form 16 January 2013; accepted 22 January 2013
Abstract
Conceptualizing knowledge leadership and customer knowledge management (CKM) in the project context is still rudimentary. Thus, the
first
objective of this study is to assess the associations among knowledge leadership, customer knowledge management, the performance of a precision
instrument sales (PIS) project, and organizational performance. The second objective is to determine whether project performance may mediate the
effect of customer knowledge management on organizational performance. The third objective is to examine the moderating role of data
complexity in the relationship between customer knowledge management and project performance. This study empirically investigated a sample of
precision instrument sales projects in Taiwanese high-tech industry. The
findings indicate that adoption of knowledge leadership is associated with
customer knowledge management. In addition, these analyses suggest that implementation of customer knowledge management influences
organizational performance via project performance. The results also show that the positive relationship between customer knowledge management
and project performance depends on data complexity.
© 2013 Elsevier Ltd. APM and IPMA. All rights reserved.
Keywords: Knowledge leadership; Customer knowledge management; Data complexity; Project performance; Organizational performance
1 . Introduction
Understanding customers and their needs is important.
Many companies attempt to align its processes and products
to develop stronger customer relationships. Although some of
the companies have knowledge of their customers, most of the
knowledge exists in fragmented form. In addition, it is difficult
to share the knowledge with the organization because it is
usually incomplete. Thus, customer knowledge management
(CKM) is becoming an important strategic issue. Customer
knowledge concerns not only understanding the customer's
viewpoints, but also collection of information and insight that a
company needs to have to build greater customer relationships.
The role of customer knowledge management is to acquire and
organize the data and allows them to be shared and applied
throughout the organization. A company needs to develop
processes and systems to gather comprehensive data and
information about the customers.
Leaders have a significant position of influence within their
organizations. Knowledge leadership has increasingly been
recognized as an essential element for organizations to enhance
customer knowledge management. While many studies have
promoted knowledge leadership and CKM as a means to
enhance organizational performance, conceptualizing
knowl-edge leadership and CKM in the project context is still
rudimentary. Previous studies have not examined the role of
project leaders in knowledge management, and their effect on
project and organizational performance. Thus, developing such
support will illustrate the benefits of knowledge leadership and
CKM adoption. The analysis of this study also shows the
relationship between CKM and project performance for
different levels of data complexity.
The analyses of knowledge leadership and CKM and
relationships with project and organizational performance are
based on an industry-wide survey performed between December
2011 and April 2012. A data collection tool was developed to
⁎ Corresponding author. Tel.: +886 2 26215656; fax: +886 2 26209742. E-mail address:iry@mail.tku.edu.tw(L.-R. Yang).
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assess knowledge leadership and CKM levels on precision
instrument sales (PIS) projects in the Taiwanese high-tech
industry, yielding 216 project responses. The data analyzed in
this study are project-specific, meaning the data are
represen-tative of the levels of knowledge leadership and CKM used in
projects.
2. Conceptual framework and research hypotheses
Knowledge is the appropriate collection of information, such
that its intent is to be useful (
Ackoff, 1989
). It pertains to
information given meaning and integrated with other contents
of understanding (
Bates, 2005
).
Davenport and Prusak (1998)
defined knowledge as
“a fluid mix of framed experience,
contextual information, values and expert insight that provides
a framework for evaluating and incorporating new experiences
and information.” The knowledge management literature has
shown that knowledge management plays an important role in
the performance of organizations (
Alavi and Leidner, 2001;
Cameron, 2004; Sabherwal and Becerra-Fernandez, 2003;
Srisa-ard, 2006; Zack, 1999
).
In recent years, companies have integrated their customer
relationship management (CRM) and knowledge management
(KM) efforts because they realize that KM plays a key role in
CRM success (
Garrido-Moreno and Padilla-Meléndez, 2011
).
The relationship between CRM and KM is an important issue
(
Campbell, 2003; Shi and Yip, 2007; Stefanou et al., 2003
). Such
is the synergy potential of both concepts that have emerged
theoretical models from the integration of both concepts: the
models of customer KM (
Gebert et al., 2003; Morgan, 2007
).
Customer knowledge refers to structured information about
customers (
Campbell, 2003; Li and Calantone, 1998
), knowledge
about customers (
Rowley, 2002, 2004
), and knowledge from
customers (
Garcia-Murillo and Annabi, 2002; Gibbert et al.,
2002
). Customer knowledge has increasingly been recognized
within marketing as a significant resource that can be managed to
support research and development and to improve innovation
(
Gibbert et al., 2002
). It can facilitate sensing of emerging market
opportunities and support the management of long-term customer
relationships (
Darroch and McNaughton, 2003
). Managing
knowledge residing in customers requires collaborating with
customers (
Garrido-Moreno and Padilla-Meléndez, 2011
).
Gibbert
et al. (2002)
have compared the knowledge from customers and the
knowledge about the customers in order to receive an integrated
outlook for the knowledge transfer. Customer knowledge
management means creating a valuable leverage and direct
interaction with the customers (
Dimitrova et al., 2009
). The
main challenge for the development of CKM is to catch these
customers' perceptions which are innovative for the
enterprise's business future (
Dimitrova et al., 2009
).
The role of leaders in managing knowledge is important to
organizations (
Crawford, 2005; Davenport et al., 1998; Sarabia,
2007; Singh, 2008
). However, knowledge management as a key
leader function has not been explored (
Bell De Tienne et al.,
2004
). Many researchers have emphasized the lack of leadership
support for the failure of many knowledge management projects
(
Lakshman, 2007
). Thus, the potential for integrating the
leadership literature with information and knowledge
manage-ment literature is likely to be beneficial for both theory and
practice (
Bryant, 2003
). In addition, although
Mintzberg (1973)
identified the informational role of top managers, previous
studies have not focused on the management of knowledge as key
leadership roles (
Bell De Tienne et al., 2004; Bryant, 2003;
Lakshman, 2005; Politis, 2001; Viitala, 2004
). For the early
attempts on the role of leadership in knowledge management,
Fleishman et al. (1991)
focused on the information search and
acquisition, and information use in problem solving behaviors of
leaders.
Day and Lord (1988)
identified the building of
information systems as a key leader activity leading to improved
organizational performance. However, a review of the literature
suggests that systematic research on the role of leaders in
information and knowledge management is lacking (
Lakshman,
2007
).
Four approaches to the examination of leadership have
evolved over the past several decades: the trait approach, the
behavior approach, the contingency approach, and the
transfor-mational and charismatic approach (
Yukl, 1998
). Although some
of the approaches addressed the role of leaders in information and
knowledge management (
Cleveland, 1985; Lakshman, 2007;
Vroom and Jago, 1988
), previous studies did not stress the
knowledge management aspects of leadership. The trait approach
focused on leaders' traits, such as their physical appearance and
personalities. It identified business knowledge as an essential
quality of effective leaders (
Kirkpatrick and Locke, 1991
).
From another point of view, the behavioral and contingency
approaches suggested that leader behavior should involve
information search and acquisition and information use which
are critical to performance (
Fleishman et al., 1991
). In addition,
Vroom and Jago (1988)
contended that information and
knowledge requirements of situations are key contingencies
that influence leader behavior. The behavior of the leaders in
facilitating the existence and availability of required information
and knowledge can have a positive effect on organizational
effectiveness (
Lakshman, 2007
). For the charismatic approach,
information acquisition and analysis is critical to the development
of vision in organizations (
Kotter, 1990
).
In order for companies to succeed in business, knowledge
leadership and knowledge management capabilities are two of
the important components that companies must possess (
Earl and
Scott, 1999; Liebowitz, 2000; Saint-Onge, 1999
). Companies
worldwide have responded by creating or re-evaluating their
knowledge leadership development programs and knowledge
management initiatives (
Davenport and Prusak, 1998; Malhotra,
2000
). Knowledge leadership is an essential element for
organizations (
Brown and Duguid, 2000
). It is an important
business development activity (
KPMG, 2000
). The role of
knowledge leadership is to promote a positive cultural orientation
toward knowledge acquisition and knowledge sharing; one that
values continuous learning, where experience, expertise, and
innovation supersede hierarchy (
Davenport et al., 1998
). Human
resource executives are frequently the best candidates for
knowledge leadership positions within organizations (
Bukowitz
and Williams, 1999; Horibe, 1999; Koulopoulos and Frappaolo,
1999
). They are typically technologically advanced, having
selected and implemented sophisticated human resource
information systems focused on aligning their organizations'
human, cultural, and structural capital with its business goals
(
Roberts-Witt, 2001
). Thus, knowledge leaders should possess
a broad range of interpersonal and organizational development
skills and need to enable cultural change, build relationship,
and facilitate knowledge transfer (
Ali and Yusof, 2006
).
Knowledge management has been promoted as a means to
enhance organizational performance. While the focus of
management is often on business issues, leadership tends to
concentrate more on people issues (
Bass, 1990
). When
organizations are viewed as learning systems, the manager's
role can be viewed as one of providing leadership in the learning
process (
Carlsson et al., 1979
). The roles of leaders in a learning
organization have been specified as being coaches, facilitators,
teachers, leaders of learning, and developers (
Macneil, 2001
). In
contrast to knowledge management, knowledge leadership refers
to constant development and innovation of information
re-sources, individual skills, and knowledge and learning networks
(
Skyrme, 2000
). Knowledge leadership is defined as a process
whereby an individual supports other group members in learning
processes needed to attain group or organizational goals
(
Stogdill, 1974
). On the other hand, customer knowledge
management means creating a valuable leverage and direct
interaction with the customers (
Dimitrova et al., 2009
). It is
defined as the acquisition and use of customer-related knowledge
to create value for the organization.
Cleveland (1985)
highlighted
the importance of the role of leadership in managing knowledge.
The study suggested that the use of teams and communities of
people is important for leaders in managing information and
knowledge. Prior research has also indicated that knowledge
leadership plays an important role in CKM (
Bukowitz and
Williams, 1999; Davenport et al., 1998; Horibe, 1999;
Koulopoulos and Frappaolo, 1999; Roberts-Witt, 2001
). The
literature on knowledge management has essentially described a
new context in which modern leaders operate (
Viitala, 2004
).
Knowledge leadership may help develop mechanisms for
accountability and control, as well as for customer knowledge
sharing. In addition, effective knowledge leadership may support
efficient customer knowledge integration, sharing, and
manage-ment. A knowledge leader is the catalyst for a knowledge-sharing
culture, owner of the infrastructure specifications that facilitate
customer knowledge transfer and storage, and maintainer of the
closed-loop learning system (
Rasmus, 2000
).
The study measured three knowledge leadership dimensions
identified in the literature as being potentially relevant to customer
knowledge management: leadership skills, cooperation and trust,
and knowledge integration and innovation. Leadership is the
ability to influence groups for purposes of goal accomplishment
(
Koontz and Weihrich, 1990
). The literature emphasized
devel-oping leadership skills that are required for most jobs or particular
occupations or job roles (
Delamare Le Deist and Winterton,
2005
). Many conceptions of leadership skill include knowledge
alongside attitudes, behaviors, work habits, and personal
charac-teristics (
Green, 1999
). Leadership skills are considered important
in being able to increase knowledge sharing among subordinates.
Prior research indicated that leadership skills may enhance levels
of knowledge management, as well as mutual influence, more
open and honest communication, and greater access to resources
(
Gerstner and Day, 1997
). On the other hand, cooperation and
trust plays a critical role in team operations (
Solomom, 2001
).
Cooperation and trust may result in uniformity of team members
and make the team more effective. In previous research, team
collaboration and trust is a highly influential factor in knowledge
acquisition, sharing, and application (
Gladstein, 1984
). Effective
knowledge management may derive from successful collaboration
and trust between team members (
Kotlarsky and Oshri, 2005
).
Finally, knowledge integration and innovation has been shown to
play an important role in knowledge management. In previous
research, knowledge integration was found to be associated with
a critical determinant of successful knowledge management
(
Davenport and Prusak, 1998
). It facilitates knowledge sharing
and application among team members. In addition, team
members' learning behavior and innovative ability are important
to create new knowledge and ideas (
Davenport et al., 1998
). Thus,
effective knowledge management requires effective knowledge
integration and innovation to support it. The literature supports
knowledge leadership adoption as a means to enhance CKM
activities. Additionally, knowledge leadership application may
positively relate to customer knowledge management. This study
extends previous research by addressing the effects of knowledge
leadership use on customer knowledge management of projects.
Based on the relevant literature, this study develops the following
research hypothesis:
H1. Knowledge leadership adoption positively influences
project levels of customer knowledge management.
Project performance is defined as the achievement of some
pre-determined project goals (
Lim and Mohamed, 1999
). On the
other hand, according to
Richard et al. (2009)
, organizational
performance comprises the actual output or results of an
organization as measured against its intended outputs (or goals
and objectives). Achieving the organization's long-term ultimate
objective (e.g., profits) will depend on the degree to which its
organizational performance is reached (
Katou and Budhwar,
2007
). Organizational performance is a multifaceted concept,
which is usually indicated by indices such as: 1) effectiveness: if
the organization meets its objectives, 2) efficiency: if the
organization uses the fewest possible resources to meet its
objectives, 3) development: if the organization is developing
in its capacity to meet future opportunities and challenges,
4) satisfaction: of all participants; stakeholders, employees,
and customers, 5) innovation: for products and processes, and
6) quality: percent of products of high quality (
Katou and
Budhwar, 2007
). In this study, organizational performance was
measured with six items that required respondents to indicate the
extent to which the company had improved its sales knowledge
and useful ideas, new market and product opportunities, cost
efficiencies, cost reduction, awareness of the firm's other
products, and sales and customer use of the firm's other products.
These items represent organizational performance at the efficiency,
development, and innovation levels. Organizational performance
is a multifaceted concept. Although the success of one project may
influence on organizational performance. Thus, the positive
relationship suggests that
H4
is supported. However, the results
of this research further prove that project performance fully
mediates the effects of customer knowledge management on
organizational performance, which supports
H5
. The findings
indicate that implementation of customer knowledge
manage-ment influences organizational performance via project
perfor-mance, which is one of the main contributions of this research.
This result also confirms the suggestion in literature that
mediators may exist between knowledge management practices
and final examined outcomes (
Chen et al., 2005; Schmidt and
Calantone, 1998; Tatikonda and Montoya-Weiss, 2001
).
In this study, knowledge leadership was measured by the
three dimensions of leadership skills, cooperation and trust, and
knowledge integration and innovation. The research findings
imply that cooperation and trust may not contribute significantly
to customer knowledge management. The results are not in
agreement with previous studies, which indicated that trust
stimulates the team members' learning behavior and allows one
member to understand skills or knowledge of one another (
Cross
and Baird, 2000; Davenport and Prusak, 1998
). The prior
research suggested that cooperation and trust may improve
customer knowledge sharing. However, based on the analysis
results, leadership skills and knowledge integration and
innova-tion are more closely associated with overall customer
knowledge management than is cooperation and trust. This
may be the reason why cooperation and trust does not contribute
significantly to customer knowledge management. In addition,
customer knowledge management was measured by the four
dimensions of knowledge acquisition, knowledge storage,
knowledge sharing, and knowledge application. The research
results show that knowledge acquisition and knowledge storage
may not contribute significantly to project performance, which
are not in line with previous research (
Vandaie, 2008
). Similarly,
knowledge sharing and knowledge application are more closely
associated with overall project performance than are knowledge
acquisition and knowledge storage. This may explain why
knowledge acquisition and knowledge storage do not contribute
significantly to project performance.
Because project success factors are not universal for all
types of projects, several studies have identified critical success
factors in certain fields or domains. For example, for
construction projects, weather conditions can be considered as
a critical factor for completing the project on time (
Belassi and
Tukel, 1996
). On the other hand, for product development
projects, the project life span and its cost are critical factors for
the immediate release of a product to the market (
Belassi and
Tukel, 1996
). While certain factors exist in one domain, they
may not be applicable to other fields. Thus,
Dvir et al. (1998)
argued that different projects exhibit different sets of success
factors, suggesting the need for a more contingent approach in
project management theory and practice.
According to the data analysis results, the influence of
customer knowledge storage on project delivery performance
increases in projects with a high level of data complexity, due
to the moderating effect of data complexity (
H6
is supported).
In other words, the influence of customer knowledge storage on
project delivery performance, for projects with a higher level of
data complexity, is more than the same effect in the case of
projects with a lower level of data complexity. It is also clear
that projects with a high level of data complexity are more
likely to be successful in training and education performance
when they experience a high level of knowledge sharing than
projects with a low level of data complexity. Projects with a
high level of data complexity may involve more complicated
tasks, uncertainty, and high risk. This type of project usually
involves diverse and complex information and knowledge. It is
not easy to manage the knowledge for projects with high
complexity and uncertainty. However, knowledge storage and
sharing is important to incorporate all the key knowledge and to
integrate the complicated tasks which are influential on project
performance. In addition, knowledge storage and sharing may
produce associations that create bridges between entities within a
project. It is also a key to team communication and an essential
element for integrating knowledge from different sources. These
may be the reasons why knowledge storage and sharing is more
closely associated with project performance for projects with a
high level of data complexity. On the other hand, projects with a
low level of data complexity are more likely to be successful in
delivery performance when they experience formal methods for
knowledge acquisition than projects with a high level of data
complexity. It is easier to improve project delivery performance
with formal knowledge acquisition approach for projects with a
low level of data complexity.
This study has clear implications for knowledge leadership
adoption. With respect to leadership skills, project managers
need to understand the importance of customer knowledge
acquisition and practice what they preach. They should try to
gain new knowledge to set an example to the others and
develop excellent knowledge leadership skills. For knowledge
integration and innovation, project managers must take action
to enhance team members' innovative ability and develop a
reward system to stimulate team members' learning behavior.
More importantly, project managers should integrate practical
experience from different departments to create new knowledge
and lead team members to execute innovative ideas.
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