The implementation of Knowledge Management in

the practice of international active Small and

Medium-Sized Enterprises with the special aspect of

motivation and commitment

Assignment in "International Business Strategy"

presented in:

the Master of Business Administration (MBA) course of studies

at:

Fachhochschule für Oekonomie und Management (FOM)

University of Applied Sciences

Dortmund

by

Stephan Jäger

Siegen, May 8th 2008

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Table of Contents

I

Table of Contents

0. Executive

summary 1

1. Introduction and procedure 1

1.1. Research objective 1

1.2. Problem statement 2

1.3. Relevance of the topic 2

1.4. Structure of the work 2

2. Terms and definitions 3

2.1. Small and medium-sized enterprises (SMEs) 3

2.2. Knowledge and Knowledge Management (KM) 3

2.3. Motivation 4

3. Relevant

theories 5

3.1. Theoretical approaches of Knowledge Management 5

3.1.1.

Theory of Knowledge Management in general 5

3.1.2.

Special theoretical approaches of KM for SMEs 7

3.2. Relevant theoretical approaches of motivation and commitment 9

3.3. Theoretical approaches for the special role of motivation and commitment in

KM in SMEs 10

4. Practical aspects for the implementation of KM in SMEs 17

4.1. Practical aspects of the implementation of KM in SMEs in general 17

4.2. Practical aspects for supporting the motivation and the commitment of

employees regarding the implementation of KM in SMEs 21

5. Conclusion

and

outlook 24

5.1. General Conclusion 24

5.2. Relevance of motivation, commitment and company culture 24

5.3. Critical Aspects 25

5.4. Outlook for the future 25

6. Sources 26

7. Appendix 30

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List of Figures

II

List of Figures

Figure 1: The knowledge ladder 5

Figure 2: An integral knowledge management model 7

Figure 3: Intrinsic and Extrinsic Motivation as a Continuum of PLOC 12

Figure 4: Configuration of incentive systems for the KM in SMEs: 16

Figure 5: Practical approach with a general management scheme for KM 17

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2

List of Tables

Table 1: Working motives and its incentives 9

Table 2: Theoretical approaches for the explanations for the behaviour

regarding to knowledge ...12

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List of abbreviation

III

List of abbreviations

APQC

American Productivity and Quality Center

Cf.

confer (latin for "compare")

DM Document

Managing

Ed. Editor

e.g.

exempli gratia (Latin for "for example")

et al.

et alii (Latin for "and others")

et seq.

et seqeuntes (Latin for "and the following ones")

ERG Existence-Relatedness-Growth

i.e.

id est (Latin for "that is")

FOM

Fachhochschule für Oekonomie und Management

(University of applied sciences for economy &

management, Essen)

KM Knowledge

Management

KPI

Key Performance Indicators

MBA

Master of Business Administration

p. Page

PLOC

Perceived Locus Of Causality

pp. Pages

SME

Small and Medium-Sized Enterprises

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0. Executive summary

1

0. Executive summary

KM is and will be a more and more important issue for all companies in the future,

especially for SMEs referring to the fast development of globalisation, if they don′t

want to miss the connection to this trend. SMEs haven′t already adopted KM in the

same way great companies has done it and often not as effective and systematic as it

should be. So SMEs must improve their efforts in this direction and apply the right

tools and processes of KM, also and especially referring to the motivational aspects,

which are indispensable for it. The focus of this work lies therefore on the practical

implementation of KM-Systems and furthermore on the special roles of motivation and

commitment of the employees in this process. SMEs must improve their efforts in this

direction and apply the right tools and processes of KM.

A it will shown, a knowledge-friendly culture and a proactive management support is

very import for the success of the KM-process. This has to be combined with good

motivational aids, incentive systems and a well planned commitment of and with the

employees from the very first beginning of the KM-process. In the comprehensive view

the whole organisational framework could be could be seen as a system of incentives,

which either motivates or discourages the employees to search for new effective be-

haviour within the KM-process.

SMEs should see the knowledge orientated trend as a positive pressure to make their

homework in the mentioned way. The presented work provides the theoretical back-

ground for the mentioned goals as well as practical tools and approaches towards KM

in SMEs. Some helpful tools are presented in the appendix.

1. Introduction and procedure

1.1. Research objective

The aim of this work is to show the relevance and the importance of KM for small and

medium-sized companies (SMEs), especially for those, which are international and

global active. The focus lies then on the practical implementation of KM-Systems and

furthermore on the aspects of motivation and commitment of the employees in this

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1. Introduction and procedure

2

process. The latter is especially worked out, because they are often mentioned as a big

hurdle for the application of KM in companies.1

1.2. Problem statement

A lot of companies in Germany are not thinking about motivational aspects when plan-

ning KM. But KM has to seen under these aspects in the same way like in other man-

agement activities too. Over all is the question, how motivation and incentives have to

be treated in KM, closely linked with a practical view on this theme, which works out

benefits and tasks of it and communicate this issues clearly.2 Therefore motivation and

the practical view are the special aspects of this work while analysing KM in SME.

That is even more important for SMEs, because the haven′t already adopted KM in the

same way great companies has done it and often not as effective and systematic as it

should be.3

1.3. Relevance of the topic

The factor "Knowledge" seems to determine more and more the welfare of societies

and the success of companies. In many eyes knowledge will become or is still one of

the most scariest and therefore worthiest resources that companies should look for.

These circumstances for society and economy are best described with the terms

"knowledge society" or "knowledge economy".4 "Knowledge Management" (KM) is

therefore seen as one of the most important factor for success, likewise in theory and in

practice.5 That is even become more obvious referring to international and global active

companies,6 also and especially for SMEs.7

1.4. Structure of the work

In the following chapter two the used terms will first be introduced and definitions will

be presented. Then the relevant theories will be presented referring to the issues KM,

motivation and commitment in chapter three. Also there will be discussed theoretical

1 Cf. Frank et al. (2002), p. 1 and North (2005), p. 148 et seq.

2 Cf. Döring-Katerkamp/ Trojan (2002), p. 147.

3 Cf. Beijerse (2000), p. 170 and McAdam/ Reid (2001), p. 231.

4 Cf. Söllner (2008), p.425, Zaunmüller (2005), p. 1, Beijerse (2000), p. 162.

5 Cf. Götz/ Schmid (2004), p. 9, Wong/ Aspinwall (2005), p. 64 and Schneider (1996), p. 13.

6 Cf. Söllner (2008), p. 427 and Chase (2007), p. 20.

7 Cf. Eden (2002), p. 41, Beijerse (2000), pp. 162 et seq., Weber et al. (2005), p. 37 and Ahlert et al.

(2005), pp. 161 et seq.

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