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Indicators of knowledge management capability for KM effectiveness

Somnuk Aujirapongpan, Pakpachong Vadhanasindhu, Achara Chandrachai, Pracob Cooparat,
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Indicators of
Indicators of knowledge KMC for
management capability for KM KM effectiveness
effectiveness
183
Somnuk Aujirapongpan
Chulalongkorn University, Bangkok, Thailand Received 6 August 2009
Pakpachong Vadhanasindhu Revised 20 October 2009
Accepted 11 March 2010

Faculty of Commerce and Accountancy, Chulalongkorn University,
Bangkok, Thailand
Achara Chandrachai
Faculty of Commerce and Accountancy and
CHULA UNISEARCH, Chulalongkorn University, Bangkok, Thailand, and
Pracob Cooparat
SpringBoard for Asia Foundation, Bangkok, Thailand
Abstract
Purpose – This purpose of this paper is to synthesize and propose the indicators of knowledge
management capability (KMC) in different knowledge management (KM) processes to assess KM
effectiveness. It also intends to provide useful indicators for those who are interested in the study of
KMC to create effective KM, who can utilize the aforementioned indicators as guidelines in the
development of empirical definitions by testing them.
Design/methodology/approach – This paper is a literature review research, through which
indicators of KMC for KM effectiveness are synthesized, utilizing related documents, literature and
other research studies and the characteristics of which are evaluated by the KM experts as specified in
qualitative research.
Findings – The results of the research suggest two main aspects of KMC for KM effectiveness: first,
a resource-based perspective, which comprises technology, structure and culture; and second,
a knowledge-based perspective, which comprises expertise, learning and information. It is suggested
that there are 84 indicators in KMC for KM effectiveness, which can be divided into: 22 indicators on
KMC-knowledge acquisition; 21 indicators on KMC-knowledge creation; 19 indicators on
KMC-knowledge storage; and 22 indicators on KMC-knowledge application.
Originality/value – Apparently the existing research concerning KMC does not reveal clear
conclusions nor designate indicators of KMC in both aspects: resource-based perspective and
knowledge-based perspective. The consequence is a lack of direction and precision in developing KMC
to achieve its effectiveness. This paper therefore provides clear visions on important aspects of KMC
whereby the various indicators of their components need to be developed to enrich the concept and
further the development of KM. It also provides future researchers with useful means to assess the KM
effectiveness in different KM processes.
Keywords Knowledge management, Knowledge processes, Quality indicators
VINE: The journal of information and
Paper type Literature review knowledge management systems
Vol. 40 No. 2, 2010
pp. 183-203
q Emerald Group Publishing Limited
0305-5728
This research is supported by Chulalongkorn University 90th Anniversary Fund. DOI 10.1108/03055721011050677
VINE Introduction
40,2 In the age of knowledge-based economy, its economy depends on the creation,
distribution and application of knowledge as the main drivers to create growth and
security for the organization, and its survival needs the transformation of the strategy
of the business from scale-based competition to speed-based competition by creating
competitive advantage utilizing knowledge, skill, experience and technology.
184 Therefore knowledge is vital and is power in any endeavor to attain success.
Activities thus need related knowledge which may be constructed by the practitioners
or imported from outside, as well as the application of the knowledge which may be
inherent in people and is clear-cut to be integrative and specific to the context of the
work of the practitioners, the agencies or the organizations (Petrash, 2001). Hence, the
knowledge used to achieve the objectives needs a process or a procedure in systematic
knowledge management (KM). Since 1990, KM is no longer merely a science of
organizational management, with the emphasis on technological and networking
applications, but a new scienceto which the world‘s leading organizations have given
utmost importance and continually provided increasingly efficient KM development
processes, in order to empower practitioners, including the increase in productivity and
organizational innovations (Carneiro, 2002; Cardinal et al., 2001; Darroch and
MaNaughton, 2002; Pyka, 2002; Adams and Lamont, 2003; Shani et al., 2003).
For KM to be successful and effective for the organizations, it is necessary to
consider the important principles, which, from the literature reviews of Wiig (1993);
Marquarde(1996); Beckman (1997); Davenport and Prusak(1998); O’Dell and Grayson
(1998) and Wild and Griggs (2008), can be formed into five main principles, as follows:
(1) The organizations and all of their personnel must realize the importance and
value of KM: knowing and understanding how KM is useful and is capable of
helping the organizations and the personnel. These are the important roles of
the administrators of the organizations whose leadership is in KM, including
setting the visions and clear strategy in utilizing KM to develop the
organizations.
(2) KM must be the combination of man and technology since successful KM does
not depend on mere technology but needs knowledgeable men with
commitment, and determination to learn, in order to bring knowledge to
develop and resolve problems in their work. It also needs the capability of
technology in creating convenience and supporting the accessibility in
knowledge acquisition from within and outside the organizations, including the
storage, dissemination of and application of knowledge to the organizations to
enable KM to attain its purposes.
(3) Creation of a learning culture, exchanging and sharing of knowledge are
important since they will affect the creation of new knowledge for the personnel
and the organizations. The administrators of the organizations must realize the
value of their personnel and emphasize the motivation and promotion of
knowledge exchanges and sharing through various activities, i.e. seminars,
group activities and team work, which need continual and constant
undertaking.
(4) KM is a continuous and serious process: it is not a project nor does it have an
ending period. Therefore, the organizational structuring, working procedures
and the responsibilities of the personnel need to be encouraging and conducive Indicators of
to continual learning and knowledge application in work practices. KMC for
(5) KM must affect the development of personnel, work and the organizations: KM effectiveness
effective KM must be able to enhance and develop the competency of the
organizations’ personnel to launch best practices including increasing the
competitive capability of the organizations.
185
The main principles of KM, as described above, lead to the conclusion that for any
organization to be able to manage knowledge efficiently and effectively, it is vital to
emphasize the importance of, and strategies in, KM processes, including knowledge on
indicators KMC which will help the organizations or the administrators to efficiently
determine the direction of the development of KM and effectively affect KM, which is
the significant objective of KM in various organizations. In reviewing and searching
literature involving KM and KMC, there are no existing researches on the topic. The
present researchers therefore intend to do a research and present an article on the
development of indicators of KMC which derive from literature and research reviews
on KM, so that those who are interested in KM can further develop the results of the
research.
Methodology, literature review and conceptual framework

The methodology used in this research on synthesizing indicators of KMC is
documentary and involves related researches in order to seek for indicators of KMC for
KM effectiveness. The characteristics of the indicators are evaluated by ten KM
experts in Thailand, according to qualitative methodology. The review of related
literature concerns the KMC, KM process and KM effectiveness, as outlined in Figure 1
– model of conceptual framework and the connection of key components in literature
review.
Knowledge management capability

The correct and efficient application of knowledge will increase the competitive
capability of the organizations. KM thus involves the transferring of knowledge to the
needy recipients within the organizations. Whether such transferring of knowledge
affects the KM effectiveness of the organizations depends on KMC. Therefore, in other
words, KMC is the capability to create and the application of knowledge by
integrating/combining various resources and activities in KM to positively affect
competitive advantage, KM effectiveness and organizational effectiveness (Gold et al.,
2001; Chuang, 2004). The literature review of the works of Sanchez and Mahoney
(1996); Davenport and Klahr (1998); DeLong and Fahey (2000); Gold et al. (2001);
Chuang (2004); Freeze (2006); Peachey (2006) and Yang and Chen (2007) suggest that
there are two perspectives in KMC as shown next.
Figure 1.
Model of literature review
to synthesize indicators of
KMC for KM effectiveness
VINE Resource-based capability perspective. This is the approach which studies the KMC
40,2 resulting from different resources: organizations with different resources will have
different KMC (Mata et al., 1995). Studies using the resource-based capability
perspective initially emphasize the resources of the organizations which infer tangible
assets, i.e. land, buildings and various instruments. But later studies have given
importance to intangible assets, i.e. organizational management structuring system
186 and organizational culture, since they are important components which make
organizations different and have more sustainable competitive advantage than those
factors accounting for only the tangible assets (Wade et al., 2004). Recent research has
studied resource-based factors which affect KMC (Gold et al., 2001) and found that
factors affecting KMC comprise:

.
Technology which refers to fundamental information technological structure of
the organization, both the hardware and software including the database and the
network system, within and outside the organizations (Yang and Chen, 2007)
which are inter-connected and efficient in the utilization of information
technology. Potential indicators of technology capabilities can affect KM
effectiveness through two paths. First, an appropriate technology must be in
place for effective KM. Second, technology can enable the flatter organizational
structures that have been suggested to increase KM effectiveness (Peachey, 2006;
Orlikowski, 2000; Miles et al., 1998). Advanced technological infrastructures in
the form of robust communications networks allow structures that are more
appropriate for effective KM (Holsapple and Joshi, 2001).
.
Organizational structure, which refers to operational and command structure of
the organizations, both official and unofficial. Besides, it includes incentive
system, work design, management support policy of the administrators and
rules, regulations and practices (Yang and Chen, 2007), which affect the KM
process and organizational leadership (Collison and Parcell, 2004). An
appropriate structure for effective KM would be one that has a minimum of
hierarchies and promotes collective knowledge rather than individual behavior.
Potential indicators for KM effectiveness include the ability to cross-functional
boundaries to obtain knowledge, knowledge sharing, and collective behavior
among employees (Peachey, 2006).
.
Organizational culture – which refers to the atmosphere and work practices of
the personnel in the organization affecting the efficiency of KM. It comprises a
culture of knowledge sharing, knowledge coordinating, knowledge co-operating
and knowledge acquiring by the personnel in the organizations (Chuang, 2004;
Yang and Chen, 2007). An appropriate organizational culture may be an a priori
requirement for effective KM. If an organizational culture is not one that readily
accepts change, the best KM program implementation may well fail (Peachey,
2006). Potential indicators for the aspects of culture pertinent to this research
include a well-known corporate vision, recognition of expertise, attitudes,
collaboration, and innovativeness (Peachey, 2006; Gold et al., 2001).
While most agree with these three factors, one could argue that there is a need to add
another factor – people, which refers to personal relationships. Good interaction on the
basis of understanding of the responsibility of each other in the organization is another
factor affecting KM with resource-based capability perspective. The KMC will ensure
that the right knowledge goes to those in need of it and will result in KM effectiveness Indicators of
of the organizations (Donoghue et al., 1999; Gold et al., 2001; Peachey, 2006). However, KMC for
the people factor may overlap with the considerations of KMC with knowledge-based
capability perspective, since knowledge-based capability perspective takes into KM effectiveness
account the factors affecting KM, focusing on tacit knowledge – which is inherent in
the people – and explicit knowledge, as in the documents (Freeze, 2006).
Knowledge-based capability perspective. This is the approach which studies KMC 187
with special importance placed on intangible assets (i.e. knowledge, expertise), KM
process and management of different kinds of knowledge: tacit knowledge and explicit
knowledge. The underlying concept is that knowledge is inherent in the people and can
be developed to be organizational knowledge (Nonaka and Takeuchi, 1995; Carrillo and

Gaimon, 2004; Freeze, 2006) through the KM process, i.e. knowledge creation,
knowledge acquisition and knowledge capture, knowledge exchange and application
so that the organizations will attain their goals or achieve their effectiveness through
KM effectiveness (Dawson, 2000). The literature review on the KMC with special
emphasis on knowledge-based capability perspective leads to the conclusion that there
are three factors involved in KM:
(1) Expertise capability. The first factor affecting KMC is expertise which renders
special importance to the tacit knowledge – the capability of undertaking
anything in a favorable way as a result of having a special kind of knowledge
which comes from experience, practice and co-operation (Freeze, 2006).
Anybody with the expertise or with knowledge and competency is considered
to be a knowledge champion and is of importance for organizational knowledge
development. He/she will have a vital role in knowledge transferring or
knowledge sharing within the organization (Hansen et al., 1999; Jones et al.,
2003). The organizations should create career paths for those experts (Alavi and
Leidner, 2001) since each expert can build a creative team (Tiwana and Mclean,
2005). Besides, the experts will be the ones who always want new knowledge
from outside (Dooley et al., 2002), thus they will increase tacit knowledge
(Gurteen, 1998; Quintas et al., 1997), including the capability of knowledge
transferring, which means the capability of changing knowledge from tacit
knowledge to explicit knowledge. Potential indicators in the area of personnel
expertise capability for KM effectiveness are the ability to observe and seek
knowledge to answer the quests, the skill to use IT and language, the ability to
build knowledge network, the ability to exchange and transfer knowledge and
the motivation to create innovativeness (Alavi and Leidner, 2001; Postrel, 2002;
Bassellier et al., 2004; Tiwana and Mclean, 2005; Freeze, 2006).
(2) Learning capability. Learning capability is lessons learning through which
knowledge is gained while one works under various circumstances. The types
of work are numerous and at many levels. Lessons learned may be in the form
of best practice or benchmarking which are good usages in KM (O’Dell and
Grayson, 1998; Alavi and Leidner, 2001). Besides, O’Dell and Grayson (1998)
suggest that internal benchmarking is the part involving the KM process in
knowledge determining, knowledge exchanging and knowledge application. As
for Davenport et al. (1998), the utilization of best practices or benchmarking for
lessons learning will enhance good learning and is beneficial in knowledge
acquisition and capturing, knowledge creation and transferring. Besides, Pena
VINE (2002) has expressed interesting viewpoints from his research study that
40,2 knowledge networks will contribute to KM. Therefore, learning from various
lessons can be available both from within and outside the organizations (Freeze,
2006). Potential indicators regarding personnel learning capability for KM
effectiveness are the ability to learn from lesson learned, best practices,
experiences and working process (Zollo and Winter, 2002; Kankanhalli et al.,
188 2005; Freeze, 2006).
(3) Information capability. The last capability in KM with the knowledge-based
capability perspective is the capability to have valuable and beneficial
information, both quantitatively and qualitatively, i.e. information on work

reality – which may come from experiments, explorations or various reports
including data storage (Freeze, 2006). However, in this research, the researchers
define information capability to cover data as well as information, although
there have been attempts to explain the differences between data and
information. Nevertheless, in reality, the distinction between data and
information is not clear. It is only indicated that information is the product
from the process that has data as the inputs and that when information is
beneficially used, through the analytical and synthesizing process, knowledge
is gained (Davenport et al., 1998). Alexander et al. (1991) said that knowledge
could mean information storage, skills, experiences and personal memories.
Therefore, the database is an important instrument in KM (Brown and Duguid,
2000). Sometime, having sufficient information can generate knowledge based
on interpretation and translation of the meaning without having experiences or
skills (Beveren, 2002) and raw data in the data storage is considered Business
Intelligence, only not yet brought into use or making any profit to the business
or the organizations (Rogers et al., 2005). The information capability in this
research thus includes data and information and knowledge documents which
exist in the organizations. Potential indicators regarding organization
information capability for KM effectiveness are modernity, the accessibility
and the retrieval, the diversities, the examination and screening of the value of
the information (McQueen, 1998; Alavi and Leidner, 2001; Harigopal and
Satyadas, 2001; Sambamurth et al., 2003; Zhu, 2004; Freeze, 2006).
To conclude, this study on KMC will encompass two perspectives: resource-based

capability perspective and knowledge-based capability perspective, as outlined above.
They have been frequently studied as key organizational factors impacting
organizational effectiveness and KM effectiveness ( John and Martin, 1984; Sanchez
and Mahoney, 1996; Semler, 1997; Bennett and Gabriel, 1999; Duffy, 2000; Alavi and
Leidner, 2001; Gold et al., 2001; McEvily and Chakravarthy, 2002; Lee and Choi, 2003;
Lin and Germain, 2003; Zheng, 2005; Freeze, 2006). The researchers will use these
perspectives as its framework to develop the indicators of KMC for KM effectiveness.
Knowledge management process

Knowledge is considered an important resource of organizations, which will help build
competitive advantage, therefore efficient KM and knowledge application is necessary
for the organizations. As an organization is composed of different sorts of personnel
who vary in their needs for knowledge and use it to attain their purposes, strategies in
KM and knowledge implementation must reckon these differences and make strategies Indicators of
in KM consistent with strategies of the business (Davenport et al., 1998; Zack, 1999; KMC for
Greiner, 2007). After clear strategies are set, work plans and activities in the KM will
follow which need the understanding of KM process. The literature review of KM effectiveness
important works on KM, for example, Marquarde (1996), Bennett and Gabriel (1999),
Zack (1999), Probst et al. (2000), Gold et al. (2001), Bhatt (2001), Birkinshaw and
Shechan (2002), Sallis and Jones (2002), Collison and Parcell (2004) and Freeze (2006) 189
indicate various viewpoints on the differentiation of KM which have diverse
characteristics; many viewpoints classify KM process and activities in KM at the same
level. However, after the literature review, KM process can be divided into four
different aspects, as follows:

(1) Knowledge acquisition. Knowledge acquisition is the first process of KM which
emphasizes and gives special importance to individual knowledge capability
in the organizations. Those who are experts are keen in knowledge acquisition
(Nonaka and Takeuchi, 1995; Birkinshaw and Shechan, 2002) and since
knowledge acquisition will benefit the organizations, knowledge acquisition
should be useful and relevant to the needs of the organizations by being
designated in the vision, strategies and direction of needed knowledge in the
part called knowledge identification (Probst et al., 2000). Knowledge
acquisition and collection can be derived both from internal knowledge
resources, i.e. knowledge about work practices, reports and documents of
various knowledge and from external knowledge resources, i.e. environmental
data, clients’ data, competitors’ data and other resources including external
benchmarking (Marquarde, 1996; Zack, 1999). A sufficient knowledge
database available both quantitatively and qualitatively will positively
affect the knowledge acquisition capability (Freeze, 2006). The organizational
resources that take part in supporting and making knowledge acquisition and
accessibility efficient are information technology and organizational structure,
which includes leadership and the existing organizational culture (Hendriks,
2001; Gold et al., 2001; Vouros, 2003; Peachey, 2006). Besides, Davenport et al.
(1998) have pointed out that the utilization of best practices or benchmarking
as lessons learned will also help make knowledge acquisition and knowledge
capture more efficient.
(2) Knowledge creation. As already described, knowledge acquisition is a process
that covers the activities of the accessibility, collecting and application of
acquired knowledge. As knowledge creation is generative, the creation of new
knowledge is thus associated with motivation, intuition, expertise and insight
that arise in an individual (Gold et al., 2001; Tiwana and Mclean, 2005). That
means the creation of knowledge must be built from the knowledgeable ones
and from lessons learned from the joint experiences of everybody working
together in the organizations. The creation of knowledge is the interaction of
knowledge, between the tacit knowledge and explicit knowledge, or what is
called “SECI Model” (Nonaka and Takeuchi, 1995), especially those who are
knowledgeable and competent or have expertise. They own tacit knowledge
and are valuable as they can create the transferring of knowledge (Gurteen,
1998; Quintas et al., 1997). They also possess explicit knowledge, either from
internal or external databases (Zack, 1999). Best practices which come from past
VINE experiences are all related positively to knowledge creation (Marquarde, 1996;
40,2 Nonaka and Takeuchi, 1995; Roth, 2003; Coulson-Thomas, 2004) through
activities that encourage knowledge sharing and lead to knowledge creation, i.e.
practices, experiments, training and seminars, conferences and team-working
(Marquarde, 1996; Takeuchi and Nonaka, 2000; Roth, 2003; Coulson-Thomas,
2004). Besides, the organizational resource factor, i.e. sufficient and efficient
190 information technology, flexible organizational structure, good policy, good
motivating system, and organizational culture conducive to team working and
co-operation, are positively related to the creation of knowledge-sharing
activities (Gold et al., 2001; Collison and Parcell, 2004; Yang and Chen, 2007).
(3) Knowledge storage. Knowledge that has been created should be stored and
categorized systematically so that it can be easily and conveniently retrieved,
becoming “knowledge retrieval” (Marquarde, 1996), and appropriate for the
dissemination of knowledge. Knowledge to be stored needs “refining” in order
to be useful and valuable for the organization (Zack, 1999; Gold et al., 2001). It
will work as organizational intelligence (Collison and Parcell, 2004). Since the
knowledge that will be stored and retrieved is both tacit knowledge that is kept
inside an individual, and the explicit knowledge that is kept in various media,
the fact that an organization has knowledgeable and competent experts will
help knowledge storage – of both of tacit and explicit knowledge – be more
efficient in retrieving and applying the knowledge (Freeze, 2006). Learning
capability of the personnel and the lessons learned or past practices of the
organizations will affect the development of concept, process and procedures of
knowledge storage and retrieval (Chatzkel, 2003). The presentation of
knowledge to the members in the organization will make them understand
and be aware of the database and knowledge that exist in the organizations
(Bhatt, 2001). The data and information that are stored in the database need
good structural designs and convenience in retrieving. A sufficient number of
databases and convenience in retrieving through sufficient and efficient
information technology, both in terms of instruments and system, will also
affect efficient knowledge storage and retrieval (Marquarde, 1996; Davenport
and Prusak, 1998; Gold et al., 2001; Hendriks, 2001; Sambamurth et al., 2003;
Peachey, 2006; Franco and Mariano, 2007). An organizational culture which
emphasizes knowledge importance and knowledge acquisition, including
knowledge acceptance and application in the work practices, will make
knowledge storage more efficient. An organizational structure with an incentive
system that promotes systematic knowledge storage to be ready for the
implementation in the work practices will affect efficient knowledge storage
(Gold et al., 2001; Peachey, 2006).
(4) Knowledge application. The final process of KM is knowledge application, so
that it can be of value to the organizations: it can make the organizations attain
the effectiveness of KM. This also implies knowledge transfer and knowledge
utilization (Marquarde, 1996; Gold et al., 2001; Zack, 1999). Knowledge transfer
can be undertaken in many ways, officially or unofficially, i.e. through various
media, conferences, study tours, change of positions or duties,
supervising-system, and teamwork (Marquarde, 1996). It also includes
knowledge transfer, which affects knowledge diffusion, and the motivation to
implement knowledge to be of value for the organizations (Gold et al., 2001; Indicators of
Birkinshaw and Shechan, 2002; Freeze, 2006). The application of efficient KMC for
knowledge will lead to the development of innovation of the product. The work
process and factors which will bring about efficiency in knowledge transfer and KM effectiveness
knowledge application are organizational information technology capability
(Hendriks, 2001), organizational structure and organizational culture
(Marquarde, 1996; Gold et al., 2001; Collison and Parcell, 2004; Peachey, 2006; 191
Rhodes et al., 2008). Besides, knowledge application is used widely in experts’
society. Best practices will affect knowledge application by increasing the level
of value of the work practices (Gold et al., 2001; Zollo and Winter, 2002). The
utilization of knowledge for the benefit of value creation and the decision to
affect efficiency in organizational practices need sufficient and correct database
or information to be used in the analysis and/or the prediction for the decision
in problem solving and determining the direction of the organizations (Gold
et al., 2001; Koskinen, 2003).
In conclusion, KM process means activities involving the utilization of knowledge in

the organizations and the creation of KM effectiveness according to the objectives or
strategies as set by the organizations. KM process is dynamic and has a cycle and
network perspectives (Probst et al., 2000) comprising four components: the acquisition,
the creation, the storage and the application of knowledge. However, for KM to be
efficient and bring about KM effectiveness, what is needed are resource-based
capability comprising technology, structure and organizational culture, and
knowledge-based capability comprising expertise, learning and information – both
quantitative and qualitative.
Knowledge management effectiveness

KM effectiveness in this study is defined as the combined effectiveness of the four KM
processes:
(1) knowledge acquisition;
(2) knowledge creation;
(3) knowledge storage; and
(4) knowledge utilization.
However, It is difficult to assess the KM effectiveness within an organization. The

strategy literature suggests a linkage to organizational performance (Gold et al., 2001).
The literature review of KM effectiveness, as in the works of Nonaka (1991); Gold et al.
(2001), Darroch and McNaughton (2002), Freeze (2006) and du Plessis (2007) finds that
most of the literature connect the success of KM effectiveness with the result of
organizational performance, which can be concluded into three aspects: efficiency,
adaptability and innovativeness.
(1) Efficiency. One benefit from KM effectiveness is economic efficiency in the
organizations (Nonaka, 1991; Grant, 1996; O’Dell and Grayson, 1998; Davenport
et al., 1998). That means it lowers costs and increases productivity. The latter is
especially obvious if KM effectiveness is effective and efficient in saving time in
information and knowledge finding, and time in working while efficiently
VINE utilizing technology, co-operation and team-working ( Johannessen et al., 1999;
40,2 Darroch and McNaughton, 2002; Lamont, 2006; Freeze, 2006). If less time and
effort is spent, all else being equal, the organization should become more
efficient (Gold et al., 2001).
(2) Adaptability. Given the constantly changing competition environment, i.e. rapid
technological change, diverse needs of the consumers and increasing global
192 market (Sallis and Jones, 2002), including changes in population, official rules
and regulations, and new technology that affect the organizations, to survive,
organizations must be responsive to those changes by having the capability of
adaptability: the capability to adapt to the attitudes, culture, technology and
structure of the organizations appropriate to changes so that the environmental

impacts will not be obstacles to the development of the organizations (Levinthal
and March, 1993; Kraatz, 1998). For the organizations to be able to adapt,
knowledge of the changing environment and the impacts on their organizations
is needed. Therefore, effective KM will encourage staff collaboration (Sveiby
and Simons, 2002) and encourage the organizations to acquire change and
efficiently use knowledge application to solve the problems and prevent the
impacts affecting the organizations (Freeze, 2006). With effective KM processes,
the organization will have the knowledge about the change and may make
efforts to adapt to the change (Gold et al., 2001). That is, the adaptability
capability of the organization resulting from effectiveness of KM (DeLong and
Fahey, 2000).
(3) Innovativeness. The literature review of effectiveness of KM in creating
innovation in the organizations shows numerous innovations today as they
have become indispensable factors in every organization. Innovativeness of the
organizations depends on the amount of knowledge and KMC and whether they
are effective or not (Cardinal et al., 2001; Darroch and McNaughton, 2002; Pyka,
2002; Adams and Lamont, 2003; Shani et al., 2003; Freeze, 2006; du Plessis,
2007). Powell (1998) and Parlby and Taylor (2000) express their concerns that
effectiveness of KM will help supporting innovation in the organizations.
Therefore, innovativeness, which means product innovation, process
innovation, implemental innovation, radical innovation, technology or
administrative innovation (Gopalakrishnan and Damanapour, 1997; Smith,
2006; Bessant and Tidd, 2007, Schilling, 2008) that occurred in the organizations
are indicators of effective KM.
The literature review as described in the Model (Figure 1) helps develop the conceptual
framework which will be used in identifying the composition of the construction and
development of indicators of KMC for KM effectiveness, which can be shown in the
Model (Figure 2).
Findings
The literature review and synthesis of KM within the conceptual framework of the
research encompass the concept about the meaning, characteristics, significance, and
benefit of KM, KM process, KMC and measuring KM effectiveness. Besides, the
authors have considered the role and significance, and the connection of KM process as
identified as the main component of KM comprising four aspects: knowledge
Indicators of
KMC for
KM effectiveness
193
Figure 2.
Model of conceptual
framework of the
development of indicators
of KMC for KM
effectiveness
acquisition, knowledge creation, knowledge storage, and knowledge application. The

factors involving KM as the sub-components of the KM process can be classified into
two specifications: resource-based capability perspective – comprising three factors:
technology, structure, and culture; and knowledge-based capability perspective –
comprising three factors: expertise capability, learning capability, and information
capability. Moreover, the empirical evaluation concerning the appropriateness quality
and validity of the indicators of KMC for KM effectiveness by ten KM experts in
Thailand, using Index of Item Objective Congruence (IOC) of the indicators, has found
that there are altogether 84 indicators with IOC of the indicators of KMC for KM
effectiveness above 0.50 considered to be appropriate (Rovinelli and Hambleton, 1977)
to be utilized as indicators which will help the organizations or the future researchers
to assess KM effectiveness. The conclusion of each of the components is shown in
Tables I-V.
Conclusion
The result of the research through literature review relating to KM effectiveness is
qualitative in nature and relies on the synthesis and interpretation of the authors and
KM experts in Thailand on the context and indicators of KMC for KM effectiveness.
The results show that KMC, both resource-based capability perspective and
knowledge-based capability perspective which will make the organizations attain
the KM effectiveness comprise 84 indicators, divided into indicators on KM process: 22
indicators on knowledge acquisition, 21 indicators on knowledge creation, 19
indicators on knowledge storage, and 22 indicators on knowledge application. The
indicators found would be significant data for those organizations wanting to develop
KM to utilize these indicators as the study framework of their organizational
development in various ways to support KM to work efficiently, resulting in
effectiveness of the organizations in terms of efficiency of practice, having the
capabilities of organizational adaptability, and innovativeness, which are the qualities
organizations need for their survival and sustainable growth. However, the indicators
are limited to revising prior studies and the perspectives of the authors.
VINE
Capabilities Indicators
40,2
Technology (Marquarde, The organizations have information technology for knowledge
1996; Gold et al., 2001; acquiring and can access new knowledge immediately any time, any
Peachey, 2006; Yang and place
Chen, 2007) The organizations have information technology to access knowledge
194 resources specific to the needs of their personnel
The organizations have information with highly efficient and modern
technology, both in terms of instruments and system
Structure (Marquarde, 1996; The organizations designate clear visions and main knowledge needed
Gold et al., 2001; Zheng, 2005; The organizations set up work units or personnel responsible for
Peachey, 2006; Yang and needed advice and support in knowledge accessibility
Chen, 2007) The organizations have supporting system for their personnel to
access knowledge resources conveniently
The organizations build knowledge networks and support their
personnel to acquire knowledge from the networks
Culture (Gold et al., 2001; The personnel understand the importance of knowledge that will help
Zheng, 2005; Peachey, 2006; the organizations attain their success
Yang and Chen, 2007) The personnel are aware of and understand the vision and goals of the
organizations
The personnel are constantly interested in knowledge acquisition for
the work practices, both from within and outside the organizations
Expertise (Marquarde, 1996; The personnel have clear knowledge and understanding of the
Birkinshaw and Shechan, objectives of the work in need of acquisition
2002; Dooley et al., 2002; The personnel have the ability in observing and are interested in
Freeze, 2006) constantly acquiring knowledge to answer the pending-questions
The personnel have the ability in acquiring specific knowledge from
other experts from within and outside the organizations
The personnel have the skills in utilizing information technology of
the organizations to efficiently acquire knowledge
The personnel have the skills in language and media utilization that
are useful in knowledge acquisition from within and outside the
organizations
Learning (Marquarde, 1996; The personnel are interested in and want to learn about business
Davenport et al., 1998; Freeze, knowledge
2006; Peachey, 2006) The personnel are interested in and feel challenged about the
organizational business
The personnel have the experiences in knowledge acquisition from
diverse knowledge resources
The personnel have interest in and see the value of past lessons or the
best practices, or the standard practices
Information (Marquarde, Knowledge resources or information storage of the organizations can
1996; Bhatt, 2001; Freeze, be conveniently accessible from within and outside the organizations
2006; Jennex and Olfman, when it is needed
2006; Wild and Griggs, 2008) The data and information documents in the organization have been
collected in many forms i.e. meeting notes, work reports, articles.
Systematic storages are available, convenient for accessibility and for
knowledge acquisition
The existing database and information in the organizations are
relevant to the needs of the personnel to efficiently utilize in the work
Table I. practice, qualitatively and quantitatively
Component variables of
knowledge acquisition Source: The authors
Indicators of
KMC for
Technology (Marquarde, 1996; Gold The organizations have information technology supporting KM effectiveness
et al., 2001; Peachey, 2006; Starns and knowledge exchanges among colleagues inside the
Odom, 2006; Yang and Chen, 2007) organizations
The organizations have information technology in
knowledge exchanges with the personnel and agencies
outside the organizations
195
The organizations have information technology supporting
knowledge exchanges unlimited of place and time
Structure (Gold et al., 2001; Zheng, 2005; The organizations have the incentive system and measures
Peachey, 2006; Starns and Odom, 2006; for knowledge exchanges among the personnel officially
Yang and Chen, 2007) and unofficially
The organizations support and encourage their personnel in
lessons-learning exchanges of their interest
The organizations motivate knowledge exchanges of work
practices among the personnel
The organizations constantly hold activities on knowledge
creation, i.e. conferences, seminars and trainings
Culture (Gold et al., 2001; Zheng, 2005; The personnel work in real practices
Peachey, 2006; Starns and Odom, 2006; The personnel see the significance of knowledge exchanges
Yang and Chen, 2007) and sharing with others in the organizations with the same
purposes
The personnel have high regard for the experts or
specialists in the organizations
The personnel hold the value of courage in constantly
undertaking innovations without being afraid of the failures
Expertise (Marquarde, 1996; Quintas The personnel have self-motivation or self- incentive to
et al., 1997; Gurteen, 1998; Tiwana and always create new ways of thinking
Mclean, 2005; Freeze, 2006) The personnel work in line with their specialties
The personnel are able to constantly present their thoughts
and new knowledge beneficial to the work of the
organizations
The personnel have the capability and competency in
knowledge exchanges with those experts or specialists
within and outside the organizations
Learning (Marquarde, 1996; Takeuchi The personnel are able to understand and present the new
and Nonaka, 2000; Freeze, 2006) knowledge learned from success or best practices of the
people in the organizations or the other organizations
The personnel understand and are interested in studying
knowledge or the practice of other units both within and
outside the organizations
The personnel like team-working and participation in the
activities of the organizations as they can create new
knowledge
Information (Marquarde, 1996; Bhatt, The organizations have database of variety of knowledge
2001; Freeze, 2006; Jennex and Olfman, and constantly apply it to work practice
2006; Wild and Griggs, 2008) The existing organizational knowledge database is able to
be applied to efficiently improve and develop the work of the
organizations
The organizational knowledge database is constantly
improved and changed for additional and up-to-date
knowledge for work practices Table II.
Source: The authors knowledge creation
VINE
40,2
Technology (Marquarde, 1996; Davenport and The organizations have information technology in
Prusak, 1998; Gold et al., 2001; Hendriks, 2001; retrieving knowledge on organizational products
Sambamurth et al., 2003; Peachey, 2006; Yang and or services
Chen, 2007) The organizations have information technology in
196 retrieving knowledge on markets and competitors
of the organizations. The organizations have
information technology that keeps the knowledge
storage safe and systematically operated
The organizations have information technology
with specific designs for knowledge storing and

application
The organizations have information technology
designating the priorities of their personnel in
appropriate knowledge utilization
Structure (Marquarde, 1996; Gold et al., 2001; The organizations are flexible in collective
Zheng, 2005; Peachey, 2006; Starns and Odom, resources utilization for knowledge storage and
2006; Yang and Chen, 2007) retrieval
The organizations designate significant
characteristics of knowledge that should be stored
The organizations provide units or personnel
specifically responsible for safe knowledge
storing and keeping
The organizations build networks in knowledge
storing and retrieving for beneficial utilization
Culture (Marquarde, 1996; Gold et al., 2001; Zheng, The personnel give importance and reckon the
2005; Peachey, 2006; Yang and Chen, 2007) value of the stored knowledge to be beneficial to
the organizations
The personnel improve the stored knowledge to
make it in a constant up-dated state
Debriefings after work practices are kept in the
database of the organizations
Expertise (Marquarde, 1996; Hansen et al., 1999; The personnel take part in the determination
Dooley et al., 2002; Jones et al., 2003; Freeze, 2006) which knowledge is worth storing
The personnel are competent and skillful in
designing and systematically storing knowledge
by themselves
The personnel are able to improve and change the
stored knowledge to make it in constant up-to-
date state and correct
Learning (Marquarde, 1996; Chatzkel, 2003; There are discussions of factors affecting success
Freeze, 2006; Calabrese and Orlando, 2006) or failures to create lessons after the work
practices before storing them as organizational
knowledge
The personnel constantly disseminate knowledge
from best practices for joint knowledge learning
Information (Bhatt, 2001; Freeze, 2006; Jennex and The information storage has a systematic
Olfman, 2006; Wild and Griggs, 2008) arrangement and structural design for good
storage and convenient retrieval
All information must be examined and filtered for
Table III. the degree of its value
knowledge storage Source: The authors
Indicators of
KMC for
Technology (Marquarde, The organizations have the information technology for accessibility KM effectiveness
1996; Gold et al., 2001; and application of knowledge on organizational products and services
Hendriks, 2001; Peachey, for the efficient development of their work
2006; Yang and Chen, 2007; The organizations have information technology for accessibility and
Rhodes et al., 2008) application of knowledge on organizational markets and clients 197
The organizations have information technology promoting efficient
knowledge transfer between organizational personnel
The organizations have preventive systems to guard against
inefficient and inappropriate knowledge application

Structure (Gold et al., 2001; The organizations have systems or activities supporting or promoting
Collison and Parcell, 2004; new knowledge transfer to other agencies without discrimination
Zheng, 2005; Peachey, 2006; The organizations have supporting process for data collection to
Starns and Odom, 2006; Yang utilize in the work practices rather than depending on individual
and Chen, 2007; Rhodes et al., judgment
2008) The organizations have the systems of appreciation by which rewards
are given to the personnel who can utilize knowledge application to
develop products or new work process that are beneficial to the
organization
The organizations have the commitment to constantly promote joint
team-working across departmental lines
Culture (Gold et al., 2001; The organizational personnel are likely to think of utilizing knowledge
Collison and Parcell, 2004; in problem-solving
Zheng, 2005; Peachey, 2006; The personnel hold the value of knowledge transfer and joint
Starns and Odom, 2006; Yang knowledge application among organizational units
and Chen, 2007; Rhodes et al., The personnel hold the value of knowledge transfer and joint
2008) knowledge application between individuals unofficially
The personnel are enthusiastic in team-working, indiscriminating of
organizational units
Expertise (Marquarde, 1996; The personnel are competent in knowledge application to constantly
Gold et al., 2001; Birkinshaw create innovations
and Shechan, 2002; Dooley The personnel are competent in knowledge application to successfully
et al., 2002; Freeze, 2006; improve or solve problems in their workplace according to the
Starns and Odom, 2006) organizations’ objectives
The personnel are competent in knowledge transfer or constantly
giving advice to other personnel in the organizations
Learning (Marquarde, 1996; The personnel apply the lessons learned or best practices to develop
Gold et al., 2001; Zollo and their work or create successful innovations
Winter, 2002; Freeze, 2006; The personnel apply the lessons learned or best practices to their
Calabrese and Orlando, 2006) ordinary work
The personnel can learn through past lessons and defects, and use
them to develop and improve their work successfully
Information (Gold et al., 2001; The information database in the organizations are sufficient and
Koskinen, 2003; Freeze, 2006; useful for the analysis and synthesis to solve the work problems and
Jennex and Olfman, 2006; develop innovations
Wild and Griggs, 2008) The information database in the organizations is easily accessible and
convenient to utilize
The information database in the organization is up-to-date
The information database in the organizations is classified with
details and significant conclusions useful for the implementation Table IV.
Source: The authors knowledge application
VINE Future study
40,2 As already mentioned in the conclusion of the research article, the authors have studied
and synthesized the indicators of effective KM by primarily concluding the concepts
derived from the literature review and the results of past research. Included are the
perspectives of the authors on the synthesis of the indicators of effective KM according
to the theoretical definition, the characteristics of which are evaluated by KM experts
198 ( Johnstone, 1981).
Thus, it should encourage further studies of KM, as this research has yet to test
statistically and empirically the significance and the extent of influence such indicators
could have under the context and environment of the organizations. Those who are
interested in the study of the KMC to create effective KM can utilize the aforementioned
indicators as guidelines in the development of empirical definitions by testing them
with the target groups, to understand the significance and the role of each of the
indicators, including the characteristics of each of their components. Estimating the
measurement of the model (confirmatory factor analysis, CFA) using structural
equations modeling (SEM) may also be useful.
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Information Systems, Vol. 21 No. 1, pp. 167-202.
Zollo, M. and Winter, S.G. (2002), “Deliberate learning and the evolution of dynamic capabilities”,
Organization Science, Vol. 13 No. 3, pp. 339-51.
Further reading Indicators of
Brown, J.S. and Duguid, P. (2000), “Balancing act: how to capture knowledge without killing it”, KMC for
Harvard Business Review, Vol. 78 No. 3, pp. 73-84.
Darroch, J. (2005), “Knowledge management, innovation and firm performance”, Journal of KM effectiveness
About the authors 203

Somnuk Aujirapongpan is an Associate Professor and Director of Management Graduate
Program of the School of Management at Walailak University, Thailand. His former position
was vice rector and the Chief of Knowledge Officer (CKO) at Walailak University. His current
research focuses on knowledge management, innovation management, entrepreneurship, and

accounting and cost information for management. He has taught MBA, master’s, undergraduate,
and executive program on strategic management, strategic cost management, and knowledge
management. He is currently a PhD student of Technopreneurship and Innovation Management
Program and holds the MAcc degree in Costing from Chulalongkorn University, Thailand.
Pakpachong Vadhanasindhu is an Associate Professor and Director of Master of
International Business Management Program of the Faculty of Commerce and Accountancy
at Chulalongkorn University, Thailand. Her research interests are in the areas of strategic
management, entrepreneurship, innovation management, knowledge management. She has also
taught PhD, DBA, MBA, MS, and executive courses on strategic management, entrepreneurship,
innovation management, and international business management. She holds the DBA in
Management from the University of Nebraska, USA. Pakpachong Vadhanasindhu is the
corresponding author and can be contacted at: pakpachong@hotmail.com
Achara Chandrachai is a Professor of Technopreneurship and Innovation Management
Program, Graduate School at Chulalongkorn University, Thailand. In addition, she is currently
working at CHULA UNISEARCH, the academic service center of Chulalongkorn University. Her
position is a deputy director of the center. She works with a range of Thai organizations on their
business strategy and knowledge management. Her research focuses on strategic management,
entrepreneurship, innovation management, knowledge management, and forecasting. She has
taught PhD, DBA, MBA, MS and executive courses on strategic management, entrepreneurship,
innovation management, international business management, and business research. She holds
the DBA in Quantitative Analysis from Arizona State University, USA.
Pracob Cooparat is an Associate Professor in Education of the Faculty of Education,
Chulalongkorn University, Thailand. In addition, he is currently the President of the
SpringBoard for Asia Foundation. He works currently with a range of international educational
organizations on their information technology management, particularly focusing on knowledge
management and information technology development. His research interests are in the areas of
knowledge management, technology management, and educational administration. He has also
taught PhD, MEd and executive courses on educational administration, project management,
and knowledge management. He holds the PhD in Higher Education from the University of
Oklahoma, USA.
To purchase reprints of this article please e-mail: reprints@emeraldinsight.com

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Indicators of knowledge management capability for KM effectiveness

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Accepted 11 March 2010

Methodology, literature review and conceptual framework

Knowledge management capability

factors affecting KMC comprise:

be developed to be organizational knowledge (Nonaka and Takeuchi, 1995; Carrillo and

information, both quantitatively and qualitatively, i.e. information on work

To conclude, this study on KMC will encompass two perspectives: resource-based

Knowledge management process

different aspects, as follows:

In conclusion, KM process means activities involving the utilization of knowledge in

Knowledge management effectiveness

However, It is difficult to assess the KM effectiveness within an organization. The

structure of the organizations appropriate to changes so that the environmental

acquisition, knowledge creation, knowledge storage, and knowledge application. The

with specific designs for knowledge storing and

inefficient and inappropriate knowledge application

Chuang, S.H. (2004), “A resource-based perspective on knowledge management capability and

No. 4, pp. 449-59.

Education, New York, NY.

About the authors 203

research focuses on knowledge management, innovation management, entrepreneurship, and

To purchase reprints of this article please e-mail: reprints@emeraldinsight.com

4. Panita Rachapaettayakom, Mongkolchai Wiriyapinit, Nagul Cooharojananone, Suparatana

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