Organisational Factors Affecting Knowledge Management Practices In Selected Kenyan Banks

Abstract

Knowledge is a complex asset that must be managed in a totally different way unlike other resources. Most organizations in the developed and the developing world, are opting for change in the management, through improving creation of new ideas and developing a best environment for the creation of envisioned ideas. Hence the need for the recognition of knowledge management practices in organizations. The purpose of the study was to examine factors affecting knowledge management practices in selected banks in the banking sector in Kenya. The study was conducted in four commercial banks (Kenya Commercial Bank, Standard Chartered Bank, Cooperative Bank and Equity Bank) located within Nairobi County. The study employed descriptive survey research design to determine the extent to which knowledge management practices have been adopted. One hundred and six (106) employees and management of selected banks formed the target population of the study. Stratified random sampling was used to make inferences of the intended population from the targeted population. Data was obtained through administering questionnaires to employees in the four commercial banks. Descriptive statistics and inferential statistics were used to analyze the data. The research established that knowledge management practices have a crucial influence on commercial banks. The results of correlation analysis of (r= 0.91), which showed a strong positive relationship between organization culture and knowledge management. Also the research findings also showed that organizational culture affects individuals' response to different situations and their interpretation of the organization surrounding environment. For example, the result outcome showed that participants strongly agreed that team collaboration, experimentation and autonomy affect knowledge management with means of 4.3143, 4.2860, and 4.5740 respectively. The study further suggests that flexible organizational structures assist to achieve decentralization of decision-making process by facilitating the communication process at all organization levels. This is supported by the effect in which organizational culture has on individuals’ response to different situations. The study also established that the internal structure and relationships prevailing in the organization have a significant effect on knowledge and that, effective ICT infrastructure is crucial in facilitating knowledge management within an organization. This is supported by the results obtained of multiple linear regression model output, which showed a linear relationship between Knowledge management practices and Information Technology. A unit increase in Information Technology led to an increase of 0.140 in Knowledge Management practices. Consequently, it is recommended that banking institutions need to include Knowledge Management practices as part of their long term corporate strategy. They also need to employ organizational cultures that enhance autonomy, trust and values which have a strong impact on the communication.