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1 Student First Name: Ahmad Student Surname: Al-Halak Copyright subsists in all papers and content posted on this site. Further copying or distribution by any means without prior permission is prohibited, except for the purposes of non-commercial private study or research, as defined in the Copyright, Designs and Patents Act 1988, or as otherwise authorised by statute. To obtain permission, please contact the author of the relevant paper in the first instance or with details of your request. 1

2 KNOWLEDGE MANAGEMENT: EXPLORING THE RELATIONSHIP BETWEEN HUMAN CAPITAL AND ORGANISATION STRUCTURE CAPITAL Abstract This paper reflects to the field of knowledge management by examining the relationship in the literature between Human Capital and Organisation structure capital effectiveness in the business organisations. Business organisations develop knowledge infrastructure to drive desired behaviours, yet Knowledge worker develop processes to circumvent the organisation s infrastructure. This may contribute to the problem of knowledge management failure. However, the relationships between Human capital and Organisation structure capital have not been empirically examined in the Syrian business organisations, until this study. In addition, most knowledge management research has been conducted at the organisation level, yet most knowledge management implementation occurs at the team level (project teams, business units, social groups). To help bridge the gap between theory and practice, this study aligned the theory more closely with the practitioners level of implementation. Using the Syrian business organisation to provide guidance for business leaders in the private sectors in how they can influence the success of knowledge management programs. Keywords: Knowledge management, Human capital, Organisation structure capital. 1 INTRODUCTION According to Bontis (2001) HC defined as skills of an employee that help meet the task at hand. It is the combined knowledge, skill, innovativeness and ability of the organisation s 2

3 individuals. On the other hand OSC is the hardware, software, databases, organisational structure, patents, trademarks and everything else that employees use to support their business activities and processes (Bontis, 2001). Knowledge management (KM) involves creating a learning culture to continuously create, share, and use knowledge for the purposes of developing new opportunities (Nonaka & Takeuchi, 1995; Senge, 1990) Knowledge and knowledge management (KM) play a big part in HC and OSC. Knowledge is considered as the new wealth of organisations by which superior business performance and a competitive advantage can be achieved (Al-Alawi, Al- Marzooqi & Mohammed, 2007). According to Al-Alawi et al. (2007, p. 22) knowledge management is currently one of the hottest topics in information technology and management literature. Knowledge management has become one of the most important trends in business because organisations are trying to achieve greater value from the knowledge they possess (Grossman, 2006), such as finding better ways to value, or elicit, and apply knowledge to create new knowledge (Denning, 2006). More than 25% of Fortune 500 companies employ Chief Knowledge Officers and another 43% are planning to do so within a few years (Bose, 2004). In addition, largest U.S. and European companies use some form of knowledge management approximately 81% of the (Becerra-Fernandez, Gonzalez & Sabherwal, 2004). However, it has been difficult for firms to implement and maintain effective knowledge management systems (Jolly & Thérin, 2007). Therefore, this research investigates and describes the relationship between Human capital (HC) and Organisation structure capital (OSC) in the Syrian business organisations. A gap in 3

4 the research of the impact of HC and OSC has been identified in the current literature; this research is attempted to provide an insight to the impact of HC and OSC. Additionally, the research presents a conceptual framework (see figure 1) with processes and contents perspectives instead of just Information technology (IT) effects that were heavily focused in the early KM initiatives. In addition to IT, there are also Human capital and Organisation structure capital that are critical to KM and its processes. 2 STATEMENT OF THE PROBLEM The problem explored in this quantitative study is that businesses tend to launch knowledge management programs without consideration of the capabilities required for the effort to prosper, making it difficult to guarantee any degree of success (Gold et al., 2001). Part of this problem, as argued by Rhodes et al (2008) and Kalling (2003) is a lack of practical guidance due to relatively few knowledge management texts that make an explicit connection between knowledge and performance. The development of effective Human capital and Organisation structure capital is discussed in the literature, and prescribed by vendors. The problem with using only the business as the unit of analysis is that it provides guidance for business leaders (Hedberg, 1981) in how they can influence the success of Human capital and Organisation structure capital framework and its impacts on their business (Lynn, Reilly & Akgün, 2000; Serenko et al., 2007). Human capital and Organisation structure capital research could provide more value if the unit of analysis (individual and organisational) is aligned with the practitioner s level of implementation. No known studies exist that examine Human capital and Organisation structure capital conceptual framework. 4

5 3 RELEVANT LITERATURE The literature review of this paper provides an insight into the issue of Knowledge Management frameworks especially taking in consideration the Human capital which affects Knowledge Management. It is important to understand the current literature in relation to Knowledge Management strategies, influences, models presented and dimension in order to comprehend the link between Human capital factor and it relation to Organisation structure capital (Minonne, 2007). In the present age the link between competitive advantage and Knowledge is considerable, which reinforces the need to in depth evaluation of the concept of knowledge management. The Human capital factors are of significant importance to determine human capital and its role within the organisation structure capital. There are different frameworks which have been presented by (Alavi et al., 2001; Scarbrough and Swan, 1999; Nickols, 2000; Hackett, 2000; Choo & Bontis, 2002; Abell & Oxbrow, 2001; Jashapara, 2005) the frameworks distinguish the varieties of Knowledge that exists e.g. common framework which has been introduced is a framework which categorises the dimensions of knowledge which distinguishes between tacit knowledge and explicit knowledge. The tacit knowledge emphasises the internalisation process of the acquisition of knowledge in which the candidate does not know how to accomplish a particular task. The approach of explicit knowledge is just the opposite, where the knowledge acquired by the individual is done consciously and there is a focus and knowledge can be communicated easily to others (Alavi et al., 2001). Tacit Knowledge is the concept which has been introduced by Michael Polanyi (1966) which is the foundation for assessment of knowledge Management. 5

6 Nickols (2000) proposes that the categories presented by Nonaka and Takeuchi should be broken down into more procedural knowledge which is declared (Nickolas, 2000). Scarbrough and Swan (1999) have introduced a collection of studies which suggests that many knowledge management initiatives over-emphasis the role of IT systems and result in failure to address the human factor. On the other hand Hackett (2000) focuses on practices associated with management and organisational learning he made a substantial contribution to the companies or organisation. The study by Choo and Bontis (2002) addresses the strategic management of the intellectual capital for well-informed organisational set up; the emphasis of the study is on intellectual capital disclosure. Abell and Oxbrow (2001) emphasises on the existing environmental conditions which impacts the operation of business. Their research focuses on business drivers for various sectors which influences the manner in which organisation achieves knowledge management. Alavi et al. (2001) discussed the knowledge management systems which can be adopted as a challenge for the benefit of the organisation. Jashapara (2005) argues that knowledge management is a processed of four direct channels such as, system technology, organisational culture, culture and strategy. The strategic knowledge management is implemented using intellectual capital and organisational performance. The systems technology and organisational learning supports the management of knowledge at various levels. The study of intellectual capital based on his frameworks represents that knowledge and learning are important factors in assessment and measurement of organisational success. A summary of the most recent studies are listed in the Table 1 below: Author Propose Type Finding 6

7 Zhang et al How organizational and technological factors interact with the nature of knowledge to influence the knowledge sharing process. A case study approach Distributed leadership, alignment of issues, incentives, coordination of a number and variety of groups, trust, technology, and implementation Murat Gumus 2007 attempted to investigate the effects of communication on knowledge sharing in an organization A questionnaire form designed and conducted to collect data from 167 Academic and Administrative in Canakkale Onsekiz Mart University (COMU), Turkey. Knowledge sharing is strongly related with communication satisfaction and communication style. Gammelgaard 2007 Aims to answer the question: is Incentives Encourage Knowledge Sharing? A questionnaire survey producing data from 1,535 respondents from 9 different organizations localized in 4 different countries. Reward Jamali and Sidani 2008 Assess the performance of a sample of Lebanese organizations of the core learning organization dimensions identified in the literature The questionnaire was compiled, comprising 40 questions consolidated from the published literature, addressing seven key learning organization dimensions. Employee participation, learning climate, systematic employee development, constant experimentation, and learning reward systems. Rhodes et al Aims to discuss factors that the A survey study, conducted amongst IT systems, structured learning 7

8 influences knowledge transfer. Table 1. Summary of previous studies. 1,086 high-tech companies. strategies, innovative organizational culture, and flexible structure and design 3.1 CONUPTAL FRAMEWORK The conceptual framework (upper layer) of the present study (see figure 1) involves consideration of active collection, dissemination and regular updating on relative data. It takes into consideration the knowledge revolution which is taking place within corporations. The emphasis is on efficiency and creation of new business process within the organisation. The framework focuses strongly on the strategies which enable to work in streamline and enhance the capture, flow and transfer of information and knowledge to specific tasks. It is achieved by organisational culture, leadership support and performance measurement. There is need to integrate Human capital and Organisation structure capital with customers knowledge in order to measure performance for successful implementation of knowledge management. The role of individual knowledge is primary in the study impacting the knowledge at individual which results in Human capital. The organisation knowledge level is structured to reach the objectives of organisation structure capital. The process of knowledge management involves creation of new knowledge, documentation and codification, dissemination of knowledge to organisational network. The conceptual framework provided by this paper is ideal for the development of the methodology for the focus of study of the study which is evaluation of impact of Human capital and Organisation structure capital on knowledge management. 8

9 Figure 1. Conceptual framework of Human capital and Organisation structure capital (upper layer). Literature has offered important theoretical grounding for this study with regard to knowledge management s frameworks, Human capital and Organisation structure capital as a predictor of effectiveness, also the research literature has emphasised that business organisations must move beyond information management into the scope of knowledge management in order to recognise, accumulate, create, transform, and distribute knowledge. (Alavi et al., 2006; Bose, 2004; Goh, 1998; Gold et al.; O Dell & Grayson, 1998; Orlikowski, 2000; Sutton, 2001; Verkasalo & Lappalainen, 1998; Walczak, 2005). Yet, despite growing awareness among practitioners that Human capital and Organisation structure capital are critical components of knowledge management success. 4 METHODOLOGICAL CONSIDERATION The methodology of the study will be quantitative nature; the key focus is on understanding the concept of Knowledge management through diverse studies so that it can be linked with 9

10 Human capital and Organisation structure capital. The top management support is gathered through interview based surveys. The focus is on Knowledge Management capabilities which can be identified through the application of the information system. The research approach is based on the systematic study of Nonaka and Takeuchi in the context of their knowledge spiral. The study attempts to gather data through conducted interviews, surveys and gathering of data which can be used to assess the impact of Human capital and Organisation structure capital on Knowledge Management of the top leading Syrian business organisations. The knowledge and experience of the leading business organisations is interpreted as the outcome of the data gathered. The objective is to support Human capital and Organisational structure capital by process and framework. 5 CONCLUSION The comparative analysis of the frameworks reveals that there are varieties of knowledge platforms which exist to evaluate the process of knowledge management. A very common framework by Nonaka and Takeuchi (1995) which has been introduced the dimensions of knowledge which distinguishes between tacit knowledge and explicit knowledge. The frameworks provide an insight into the study of Human capital and Organisation structure capital which impacts on knowledge management. The conceptual framework presented in this paper can be compared with the integrative framework presented by Jashapara (2005), in which he focuses his study directly on the knowledge management which is processed through four direct channels system technology, organisational culture, culture and strategy. The framework presented in this paper focuses more on the Human capital and Organisation structure capital which assesses through surveys, interviews. 10

11 The framework of the present study involves consideration of active collection, dissemination and regular updating on relative data. It takes into consideration the knowledge revolution which is taking place within business organisations. This research will have a deeper understanding of the business organisations which results in developing a conceptual framework in order to provide acceleration in a project life cycle functional of business organisation. This is an important issue to address which is the focus of many business organisations today. 9 REFERENCES Abell, A. & Oxbrow, N Competing with Knowledge, Library Association Publishing, London. Al-Alawi, A. I., Al-Marzooqi, N. Y., and Mohammed, Y. F Organizational culture and knowledge sharing: Critical success factors. Journal of Knowledge Management, 11(2), Alavi, M., & Leidner, D Review: knowledge management and knowledge management systems: conceptual foundations and research issues. MIS Quarterly, 25, Becerra-Fernandez, I., Gonzalez, A., and Sabherwal, R Knowledge management challenges, solutions, and technologies. Upper Saddle River, NJ: Pearson Prentice. Bontis, N Intellectual capital: an exploratory study that develops measures and models. In C.W. Choo, N. Bontis (Eds.). The Strategic Management of Intellectual Capital and Organizational Knowledge. NY: Oxford University Press. Bontis, N Assessing knowledge assets: a review of the models used to measure intellectual capital. International Journal of Management Reviews, 3, Bose, R Knowledge management capabilities and infrastructure for e-commerce. Journal of Computer Information Systems, 42(5) Choo, C.W. & Bontis, N The Strategic Management of Intellectual Capital and Organizational Knowledge. Oxford University Press, USA. Denning, S Ten steps to get more business value from knowledge management. Strategy and Leadership, 34(6), Grossman, M An overview of knowledge management assessment approaches. Journal of American Academy of Business, 8(2), pp Hackett, B Beyond Knowledge Management: New Ways to Work and Learn. The conference board. Hedberg, B How organizations learn and unlearn. In P. Nystrom & W. Starbuck (Eds.), Handbook of organizational design, Oxford, UK. Oxford University Press, 1, pp Rhodes, J., Hung, R., Lok, P., Lien, B. Y. & Wu, C. M Factors influencing organizational knowledge transfer: implication for corporate performance, Journal of knowledge management, Vol. 12 No 3, pp Jashapara, A The emerging discourse of knowledge management: a new dawn for information science research?, Journal of Information Science, Vol.31, No.2, Jolly, D., & Thérin, F New venture technology sourcing: Exploring the effect of absorptive capacity, learning attitude and past performance. Innovation: Management, Policy and Practice, 9, Kalling, T Knowledge management and the occasional links with performance. Journal of Knowledge Management, 7(3), pp

12 Lynn, G. S., Reilly, R. R., & Akgün, A. E Knowledge management in new product teams: Practices and outcomes. IEEE Transaction on Engineering Management, 47, pp Minonne, C Towards an integrative approach for managing implicit and explicit knowledge: An exploratory study in Switzerland. In B. Martins & D. Remenyi (Eds.), Proceedings of the Eighth European Knowledge Management Conference, Barcelona, Spain. Nickols, F The Knowledge in Knowledge Management: The Knowledge Management Yearbook ed. J.W. Cortada and J.A. Woods, Butterworth-Heinemann, Nonaka I. & Takeuchi, H The Knowledge-Creating Company: How Japanese Companies Create the Dynamics of Innovation. Oxford University Press. Polanyi, M The Tacit Dimension. London, UK: Routledge and Keoan. Scarbrough H. and Swan, J. (eds) Case Studies in Knowledge Management. Institute of Personnel and Development. Senge, P The leader s new work: Building learning organizations. Sloan Management Review, 32(1),pp Serenko A., Bontis, N., & Hardie, T Organizational size and knowledge flow: A proposed theoretical link. Journal of Intellectual Capital, 8(4),