CHAPER – IV

RESEARCH METHODOLOGY

4.0 Research Methodology

This chapter discusses the research model for exploring the association between

enablers, KM Process and KM benefits. In this chapter, the first part discusses

Knowledge Management process, enablers and benefits with a focus of SMEs. Based

on the review, hypothesis is developed, appropriate research model is framed and

presented. In the latter part of this section, discusses the development of research

instrument and questionaries’ for conducting the survey and to validate the research

model identified.

4.1 KM Process Construct

The literature identifies various processes for adopting KM, worldwide. The

following table captures various KM process discussed by researchers,

Table 4.1 Summary of KM Process by various researchers

Authors Area of Work KM Processes
Creation, Acquisition, Location,
structuring, storage, transfer,
Spanish manufacturing dissemination, implementation and
Marian et al (2010) companies measurement
Hi-tech firms from
Yang and Rui (2009) China Acquisition and dissemination
Mfg. firms in Knowledge capturing, applying, sharing
Lee.V.H, et al (2013) Malaysia and storing
Spanish mfg. small,
Donate and Guadamillas - medium and large
2011 firms Exploitation and exploration
Electronics co. in
Huang,T.T, et al (2010) Taiwan Knowledge Sharing
Hitech mfg. co from Knowledge development, transfer &
Marques et al (2006) Spain protection
Hitech firms from
Liu P.L., et al (2004) Taiwan Obtaining, refining, storing and sharing
Large firms in
Cheng Ling et al., (2010) Malaysia Acquisition, sharing and application
Tele communication Crating, organizing, storing, sharing and
Al-Hakim L.A.Y, (2010) firms from Iraq utilizing
Acquiring, Storing, Sharing, creating
Khalil et.al.2006 Mfg. firms in US and applying
Capturing, creating, sharing, storing,
Jones,M.B, (2009) Mfg. firms in US organizing and applying

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 On observing the above table of various KM process adopted by researchers, we

can broadly group the KM Process as Knowledge Acquisition, Knowledge Creation,

Knowledge Storing and Knowledge Transferring. The current study uses these four

steps reflecting the entire gamut of KM process in developing the research model.

4.2 Developing the KM Enablers construct

Successful implementation of KM requires many supporting factors, generally

referred to critical success factors or enablers. The absence of these enablers leads to

poor implementation of KM. Companies differ in size, number of employees, maturity

level, culture, type of leaders, industry sector they belong to, etc. Hence, there are

multiple factors creating favourable condition in practicing KM. Enablers comprises

various components such as organizational structure, technology, leadership and

learning culture. (Dr.Stankosky, 2005).

(Wong and Aspinwall, 2005) in his research identified exhaustive list of critical

success factors for practicing KM in SMEs. Various factors enumerated are culture of

the firm, top leadership support, usage of information technology, existence of strategy

and its purpose, measuring the outcome, existence of appropriate infrastructure, KM

process and activities, motivational tools, management of human resource, training and

education. He further ranked these factors in order of preference. Among these, the top

three are Leadership support, Culture and KM Strategy. Out of these three top factors,

this study included Leadership support and Culture as enablers. Many researches on

Indian SMEs highlights lack of formal KM policy. The study ranked technology as an

enabler in the lower order. However, the study revealed, among the top three initiatives

in managing knowledge, ICT tool is one of them. SMEs perceive ICT as non-

important, but puts in place requisite ICT tools for managing the knowledge. Hence,

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this study included the use of ICT tools as internal enablers for constructing the

research model.

In addition, conducive Government policies are critical for fostering SMEs.

Hence, this study includes Government Policy support as external enablers in

supporting Knowledge Management initiatives among SMEs. To sum it, the current

study considers Culture, Leadership support, Use of ICT tools and Government policy

support as enablers in developing the research model.

4.3 Developing the KM Benefits construct

Measuring the outcome of knowledge implementation is challenging due to its

direct and indirect impact on the organization performance. The literature identifies

many benefits of implementing KM in large and as well as SMEs. (I.R.Edvarson and

et.al., 2012) in his literature review on KM benefits in SME, revealed implementation

of KM benefits SMEs in multiple ways. He grouped these benefits into five for better

understanding. These five benefits are Organizational success, Employee development,

Customer satisfaction, Systematic knowledge activities, good external relationship and

Strategy.

The organizational success comprises a combination of operational performance

such as improving efficiency, productivity, better decision making and quicker

response to customer and overall organizational performance namely sales growth,

increase in profits, cost reduction and increase in market share.

Employee development comprises retention, learning, improving employee

skills, team spirit and employee training. Customer satisfaction includes enhancing

customer loyalty, improving product cum company reputation and service quality.

Systematic knowledge activities consist of innovation, new product or service offering,

new ways of working, creativity, etc. The benefits grouped can be perceived as direct

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and indirect outcomes. Although indirect benefits do matter, this research considers

operational, organizational and innovation benefits for the current study. Hypothesis is

developed to explore the impact of enablers on KM process and the impact of KM

process on KM benefits. The hypothesis statement is as under

Impact of Enabler on KM Process

1. Hypothesis: Culture as an enabler has significant impact on KM Process

2. Hypothesis: Leadership support as an enabler has significant impact on KM

Process

3. Hypothesis: Use of IT tools as an enabler has significant impact on KM Process

4. Hypothesis: Support of Government Policies as an enabler has significant

impact on KM Process

Impact of KM Process on KM Benefits

1. Hypothesis: KM Process has significant impact on Operational performance

2. Hypothesis: KM process has significant impact on Organizational performance

3. Hypothesis: KM Process has significant impact on Innovation as benefit

4.4 Developing the research Model

Research model is a visual or written representation of the conceptual construct

to be studied and their relationship among them. Based on the above discussion and

hypothesis framed, the research model is developed and given in the Figure 4.1.

Model proposition

KM Enablers KM Process KM Benefits

Culture Knowledge Acquisition Operational Performance

Leadership
Knowledge Creation
support Organizational
performance
IT tools Knowledge Storage

Innovation
Govt policies Knowledge Sharing
support

Figure: 4.1 - Research model

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 The above model consists of 11 constructs and the construct’s questionnaires

are developed to elucidate the perception of the SMEs on these latent variables

respectively.

The model developed needs to be empirically validated and tested its suitability

for SMEs through survey using questionnaires as research instrument. The following

section discusses the questionnaire development and its reliability in validating the

construct.

4.5 Questionnaire Construction.

The questionnaire comprises of two parts. The first part intent to capture the

demographic profile of the respondent company. The second part of the questionnaire

focuses on capturing KM process, KM enablers and KM benefits. Each of these three

processes comprises various statements to capture the respective dimensions. KM

Process being studied are knowledge acquisition, knowledge creation, knowledge

storage and knowledge transfer. KM Enablers being studied are culture, leadership

support, use of ICT tools and Government support. Under KM benefits, operational

performance, organizational performance and innovation are being studied. The

demographic statements are categorical in nature. In the second part of the

questionnaire, the study adopted 5-point Likert scale having 5 for Strongly Agree, 4 for

Agree, 3 for Neither Strongly Agree nor disagree, 2 for Disagree and 1 for Strongly

disagree, to elicit the opinion. In addition, the questions are included to explore the

extent of awareness being practiced to obtain the level of awareness on knowledge

management in SMEs. The below tables list the items against each construct used for

the current study.

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 Table 4.2 KM Process constructs and respective Items
Items
coding KM Process - Acquisition
Our company
KA1 Encourages to attend workshops, conferences, courses for skill development
Encourages employees to participate in professional network events organized
KA2 by industry organizations, productivity council, etc
KA3 Reimburse fees for continuous education relevant to our work
KA4 Encourages employees to work in teams having external experts
KA5 Always collaborate with suppliers in solving customer needs
Encourages interaction with customers to understand their needs or
KA6 requirements
KA7 Trains individual employees in upgrading the relevant skills
KM Process - Creation
Our company
Has process for acquiring insight from different sources such as customers,
KC1 suppliers or competitors
KC2 Encourages and open to new ideas from employees
Openly discusses among employees, managers and Owners to address business
KC3 issues
KC4 Explore future expansion based on research and market insights
Encourages new ideas from employees in optimizing work processes to
KC5 enhance the productivity
Encourages the habit of dairy writing among employees to capture the regular
KC6 activities
KM Process - Storage
Our company
KS1 Has process for collecting various sources and types of knowledge
Has central repository to store policies, manuals, standards, experts’ directors,
KS2 good practices, etc.
KS3 Maintains database of employee skills, expertise and knowledge
Has process in place to discuss the failures and successes and documents it for
KS4 future use
Has working manuals and defined procedures for trouble free functioning of
KS5 day to day activities
KS6 Regularly updates databases of good work practices and lessons learned
KM Process - Transfer
Our Company
KT1 Always recognize and shares new ideas or practices from employees openly
KT2 Employees openly shares their work successes and methods of achieving it
KT3 Brings out regular news letters, circulars, bulletins for our employees
Provides individual performance appraisal report and discusses it with
KT4 employees
Employees participate regularly in business meetings with suppliers,
KT5 customers and other stakeholders
Has robust induction programme for new employees to familiarize the working
KT6 system and procedures of the organization
KT7 Achievers are facilitated through special events, regular meetings etc.

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 Table - 4.3 - KM Enablers constructs and respective items
Culture as an enabler
In our company
EC1 Information flows smoothly without hindrance
EC2 Daily routines are governed by standard operating procedures
EC3 Employees deliberate on lessons learned to avoid pitfalls
Achievement or merits are given importance and employees are competitive
EC4 and achievement driven
EC5 Our organization nurtures and rewards new ideas from employees
Employees feels company as an extended family and shares interests among
EC6 colleagues without inhibition
Employees willingly collaborate across the departments within the
EC7 organization
Enabler -Leadership

EL1 Owners/managers provide job security and stability for the employees
Owners/ Managers is supportive by providing adequate resources and
EL2 financial support

EL2 Owners and managers encourage smooth flow of information at all level
Owners and managers encourage and promotes conducive climate for
EL3 knowledge sharing
Owners/Managers openly discusses ways and means of solving issues with the
EL4 employees
Owners and Managers conducts regular meetings to share the business
EL5 objectives and review the progress
Owners / Managers encourages employee motivation and commitment to their
EL6 work
Enablers ICT Tools
Our company

EIT1 Allows employees to use internet for searching work related information

EIT2 Employees use e-mails for communicating externally to vendors, clients etc.

EIT3 Have our own web pages for branding and information sharing purposes
Employees extensively use WhatsApp for sharing operational related
EIT4 information
EIT5 Use video and audio conferencing for information sharing purposes
Enabler Govt policy support
Our company

Subscribes to newsletters, bulletins and magazines brought out by government

EG1 and industry organizations namely FICCI, Productivity council, etc
Employees are sponsored to attend workshops organized by State and Central
EG2 Government bodies and Industry associations
Avails funds provided by Govt schemes to participate in domestic and
EG3 international trade fairs, conferences etc

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 Table 4.4 - KM Benefits construct and respective Items
Operational Performance
BOP1 Helped to solve the customer problems in newer ways
BOP2 Helped to enhance the skill sets of employees

BOP3 Helped in improving the productivity and efficiency of the employees

Helped to increase the employee’s participation in achieving the
BOP4 organizational goals
Organizational Performance
Enhanced our ability to use business insights gained from external sources
BORP1 namely suppliers, clients, govt bodies etc.
BORP2 Helped in improving the decision making
BORP3 Helped to adapt our products and services based on client needs
BORP4 Helped to improve our market share and geographical reach
Helped to enhance the profit by lowering costs, avoiding wastages and
BORP5 duplication

Innovations
BIN1 Helped in new products or service offerings

BIN2 Helped in developing new process or improvement in existing process

BIN3 Helped in devising new or improved marketing strategies

4.6 Pilot Study

Pilot study helps the researchers to determine the best methods to adopt for the

study, to examine the relevance of the research instrument for the current study, design

the sample frame, estimate the sample size and finally to evaluate the feasibility of

conducting the research.

A pilot study was conducted to test the content validity and their relevance of

questionnaire in measuring their respective construct. 58 pilot study responses were

collected. The responses are analysed for its internal consistency and reliability.

The pilot study indicated the questionnaires are understood satisfactorily and it

reflects the essence of measuring the respective constructs.

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4.7 Reliability and Validity of questionnaire construction

The reliability of the questionnaire construction is evaluated using Cronbach’s

Alpha tool. The data obtained from the pilot study is analysed and the values obtained

against each construct are mentioned in the below table 4.7.

Table - 4.5 Analysis of Reliability

Number of
"Cronbach's
Sl No Dimension particulars items or
alpha"
variables
1 KM Process - Acquisition 7 0.745
2 KM Process - Creation 6 0.813
3 KM Process - Storage 6 0.786
4 KM Process - Transfer 7 0.738
5 Culture as enabler 7 0.86
6 Leadership support as enablers 7 0.899
7 ICT tools as enabler 3 0.839
8 Govt policy support as enabler 3 0.638
9 KM Benefits - Operational performance 4 0.841
10 KM Benefits - Organizational performance 5 0.834
11 KM benefits - Innovation 3 0.772

The Cronbach alpha value ranges between 0 to 1 in measuring the reliability of

the items and the value closer to 1 indicates high reliability. Generally accepted

threshold value is more than 0.6 and the values in our study is more than 0.6, indicating

the reliability of the questionnaire.

4.8 Sample Size estimation for the study

The responses from the pilot study are analysed for descriptive statistics values

of mean and standard deviation. Using the values of known mean and standard

deviation, sample size is calculated through the following formula for computing the

sample size

n = (δ*1.96/µ*0.05)^2

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where δ is the standard deviation, µ is the mean value and n is the sample size. The

sample size computed based on the data comes to 191.

The current study uses structural equation modelling technique. Generally

followed threshold value for sample size to use SEM technique is ten times the number

of paths for each construct. Also, based on the minimum R² value of 0.1, having a

maximum of 7 number of paths, a threshold value indicated (Hair Jr, et.al., 2013) is

166. The current study carried out has a response data of 616, meeting the above

values.

4.9 Sampling Design

Sampling design is the foundation for the social research. It assists the

researchers in identifying the sampling methods for the study considering the

limitations of time, money and accessibility of the identified target population.

The current study has been restricted to SMEs from South India due to time and

economic constrain. The present study restricts to the registered SMEs obtained from

the Ministry of Micro, Small and Medium Enterprises, Government of India. Due to the

limitation of the time and cost, a representative sample of registered SMEs from South

India is considered for the present study. The number of registered SMEs, the sample

size computation details is as under.

Table: 4.6 Sampling Design

Survey No. of SMEs
SME included for the % Response recd in
No. of sample to Questionn study post complete form to
SME population aire sent Response Respons validation of the total response
units in % to received e in % response received
Tamilnadu 21000 10% 2100 195 9% 168 86%
Telengana 11000 10% 1100 161 15% 150 93%
Andhra Pradesh 13000 10% 1300 168 13% 145 86%
Karnataka 9000 10% 900 157 17% 153 97%
54000 10% 5400 681 12.61% 616 90%

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 Questionnaires were sent through post, google form and electronic mail. Out of

the 54,000 registered SMEs in South India, samples of 10% from each state were

identified, through systematic random sampling technique. We have received 681

responses and of which 616 is considered for the study post validation of data for

incomplete questionnaires.

4.10 Statistical tools adopted for data analysis

Multivariate analysis technique was used to analyse the data. The study utilized

SPSS Version 20 for analysing the data and applied various quantitative techniques

such as One-way Annova, Factor analysis tools, Correlation analysis, Regression

analysis and Structured equation modelling techniques to test the proposed hypotheses.

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