Knowledge management is important for large and small organizations alike (Wickert and Herschel, 2001). This is particularly so in the high-technology field, in which an organization's competitive advantage is usually derived from knowledge (Matusik and Hill, 1998). As markets become more global and deregulated, these organizations need to be increasingly responsive, efficient and innovative (Wong and Aspinwall, 2004).
Many techniques and technologies for managing knowledge are designed for large businesses (Koh and Maquire, 2004). Likewise, much of the research into knowledge-management issues pertains to large organizations. Unfortunately, the prescribed knowledge-management strategies and tactics are not very effective in capturing tacit forms of knowledge and are often not suitable for small- and medium-sized enterprises (SMEs).
SMEs are especially dependent upon their employees' tacit knowledge (Wong and Aspinwall, 2004; Wickert and Herschel, 2001). The informal and oral communication culture that is typical of many SMEs is not naturally conducive to capturing knowledge in ways prescribed to date (Wong and Radcliffe, 2000). Koh and Maguire (2004) found 90% of SMEs did not use knowledge management. Respondents in their study reported the cost of knowledge management implementation as prohibitive and hard to justify. Without more suitable ways of managing knowledge, these organizations are at considerable competitive risk when key employees leave. Despite this risk, research into knowledge management within SMEs remains underdeveloped (McAdam and Reid, 2001; uit Bijerse, 2000; Lim and Klobas, 2000).
SMEs have unique characteristics that both hinder and support knowledge management (Koh and Maguire, 2004; Wickert and Herschel, 2001; Wong and Aspinwall 2004). For instance, while SMEs have fewer financial and human resources to make use of knowledge-management techniques and technologies than do large businesses (Koh and Maguire, 2004), they also have simpler, flatter, organic structures, entrepreneurial cultures and less formalization and standardization. These latter features are particularly favourable for acquiring, creating and managing forms of tacit and cultural knowledge (Koh and Maguire, 2004) as well as for sharing knowledge (Wickert and Herschel, 2001; Wong and Aspinwall, 2004).
It appears knowledge-intensive firms are becoming more aware of the need to create, share and capture forms of explicit and tacit knowledge (Hurst and MacDougall, 2005). The study described in this article adds insight into how small technology businesses can manage and transfer knowledge to reduce their risk of losing key knowledge held by transient workers.
The experiences of two organizations are drawn from a larger study. Both were able to leverage favourable small-business characteristics through structural and cultural supports in order to foster knowledge creation and transfer and ultimately achieve business success through their knowledge-workers. The two companies also handled growth, despite the knowledge-management challenges, as they transitioned to more formally managed stages of organization development (Wickert and Herschell, 2001). Each demonstrated how knowledge development and transfer could be accomplished and the entrepreneurial spirit maintained. Finally, when key knowledge workers did leave, each organization was able to manage the departure and seize the opportunity to develop and move forward.
The following section reviews literature contributing to our understanding of knowledge management, the impact of organizational design for knowledge sharing and creation, and how knowledge is managed effectively through the stages of organizational growth. Subsequently, the two companies are introduced and their methods for knowledge management are described.
Within the context of on-going change, growth and business development, the creation and management of key knowledge and human intellectual capital is critical and especially challenging. …