Change Readiness Influences on Knowledge Management Processes: A Case of Three Professional Service Firms

Introduction: The current dynamic market is characterised by stiff competition and ever-changing clients’ demand for better and innovative products and services. In this challenging environment, the need for developing and managing knowledge transcends the importance of accumulating physical capital. With an increasing awareness of the potential of knowledge as a competitive source for firms’ survival, there is an increased knowledge management initiatives and investments by firms. Nevertheless, literature highlights increasing failures of knowledge management initiatives, with reasons for the failure yet to be established conclusively. On the basis of the premise that implementation of the knowledge management process could induce changes in firms’ practices and culture, and employees’ beliefs and cognitive structure, the current thesis addresses the issue from the change management perspective. The main idea that drives the research evolves from the understanding that failure in knowledge management initiatives could be rooted in the lack of readiness to change. Objective: The primary objective of this thesis is to understand how the change readiness construct shapes the various processes for managing knowledge in professional service firms. Change readiness in this thesis was conceptualised as a multidimensional and multilevel construct. This thesis contributes to the body of knowledge by explicating the way these change readiness elements shape knowledge management processes. The study setting within the professional service industry offers unique insights, which is less explored in the extant KM literature. Method: The study was conducted within the professional service firms’ context, on the basis that knowledge represents the main source for survival and competitiveness in this knowledge-intensive industry. This research is grounded in the interpretive paradigm and is studied from the constructivist epistemological lens. This qualitative research employed multiple case study design in three New Zealand professional service firms. Two firms are accounting establishments and one represents an engineering maintenance firm. Sixteen semi-structured interviews, conducted over the period of two months, involved the managerial and operational professionals in these participating firms. Data were analysed following the grounded theory analysis and findings presented using cross-cases analysis. Results: This thesis contributes to the body of knowledge in the field of knowledge management (KM) by revealing the distinctive influences of multidimensional elements of the change readiness construct on the knowledge acquisition, knowledge application and knowledge sharing processes in the firms studied. The thesis proposes three dimensions of the change readiness construct, which are categorised as KM change understanding, KM change context and individual differences. The dimension of KM change understanding consists of change goal, change benefit, need for knowledge, perceived management support and collective commitment. The KM change context is comprised of learning, participation, communication and management support. Individual expertise and adaptability represent the individual differences dimension of the change readiness construct. Specifically, findings show that: 1) Readiness for the knowledge acquisition process is largely shaped by the individual’s change readiness elements, including the understanding of the need for knowledge and perceived management support, and the individual’s capability of expertise and adaptability. Learning and communication provides the essential contexts that shape the firm’s readiness for the knowledge acquisition process. 2) Readiness for the knowledge application process is largely shaped by the individual’s change readiness elements, including the understanding of change goal, change benefit and perceived management support, and the individual’s capability of expertise and adaptability. Collective commitment shapes professionals’ understanding of knowledge application at the firm level. Learning and management support provides the essential contexts that shape the firm’s readiness for the knowledge application process. 3) Readiness for the knowledge sharing process is largely shaped by the firm’s change readiness elements, consisting of professionals’ understanding of collective commitment, and the essential contexts of communication, participation and learning. Understanding of the need for knowledge and change benefit, as well as the professional’s expertise, shapes the individual’s readiness for the knowledge sharing process. 4) The way these change readiness elements shapes the distinctive KM processes in the professional service firms studied vary due to the effects of firm archetypes, inter-profession differences, change nature, knowledge nature and the demographic characteristic. These factors moderates the interrelationships described in in 1), 2), and 3)

Assessing the Non-Financial Predictors of the Success and Failure of Young Firms in the Netherlands

In this study, the Lussier (1995) success and failure prediction model is improved and tested on a sample of Dutch firms. Besides clearly defining a specific business plan, work experience is added as a variable, and contrary to previous researches, the discrete variables are dealt with appropriate this time. The results of this improved model show that product/service timing, planning, management experience, knowledge of marketing, economic timing, professional advice, and having a business partner are predictors of success and failure for young firms in the Netherlands.Business Planning, Small Business, and Success in Business

Changing career models and capacity for innovation in professional services

A number of professional sectors have recently moved away from their longstanding career model of up-or-out promotion and embraced innovative alternatives. Professional labor is a critical resource in professional service firms. Therefore, changes to these internal labor markets are likely to trigger other innovations, for example in knowledge management, incentive schemes and team composition. In this chapter we look at how new career models affect the core organizing model of professional firms and, in turn, their capacity for and processes of innovation. We consider how professional firms link the development of human capital and the division of professional labor to distinctive demands for innovation and how novel career systems help them respond to these demands

Knowledge sharing and competitiveness of professional service firms: A case study

The problem addressed in this study is that little action is taken to create the social aspects and social value of knowledge-sharing culture within organizations. There is a need for increased understanding of the behavioral side of knowledge management. The purpose of this study was to focus on knowledge sharing from a behavioral perspective. Knowledge management is defined as the accumulation, protection, and leverage of knowledge. This research study investigated the relationship between knowledge sharing and competitiveness and approached the field of knowledge management from the organizational, cultural, and behavioral perspectives. The research questions examined how knowledge workers described the parameters and conditions of knowledge sharing, as well as the relationship between knowledge sharing and competitiveness of professional service firms. The overall research design employed three focus groups and individual interviews of a selected professional service firm. Similarity and commonalities of data from interviews were color coded and labeled. Field notes, handouts, and a qualitative research computer program were used to triangulate data. Results of the study generated and established five specific categories. The categories of spiritual essence of business, believability and openness, and ethical responsibility present the mind and spiritual connection to enhance the value of knowledge sharing as a factor for competitiveness. In addition, the categories of whole brain learning and connectivity are context for creating a learning organization. The implications for social change include a clearer understanding of knowledge sharing which can increase organizational competitiveness. The effect of the added competitiveness of professional service firms can result in enhancing economic and social value of their key stakeholders

An exploration of architectural innovation in professional service firms

Thesis (S.M.)--Massachusetts Institute of Technology, System Design and Management Program, 2007.Includes bibliographical references (leaves 103-105).Architectural innovation is achieved using architectural knowledge to reconfigure an established system to link together components in a new way that provides a competitive advantage. Components in professional service firms are the expertise areas in which the firms have developed proficiency or those in which they plan to develop it. Competitive advantage in professional service firms is related to the capacity of the firm to add continuing value to a dynamic set of clients and to itself. In order to add value, professional service firms, being knowledge intensive, must develop capabilities that enhance the knowledge capital they possess, which is valuable to both its clients and to the professionals they employ. This knowledge capital can be classified into Human Knowledge, Relational Knowledge and Structural Knowledge. The first two types are comprised mainly of tacit knowledge, while the third one consists of explicit knowledge. Architectural innovation modes result from the reconfiguration of these knowledge types in ways that enhance the value creation processes of professional service firms. This work explores the ways professional services firms achieve these reconfigurations and offers insights into the key characteristics of successful practices.by Fernando Espinosa Vasconcelos.S.M

DIALOGUE

In a recent Academy of Management Review article, Professor Andrew von Nordenflycht (2010) focused on defining professional service firms (PSFs). In the article von Nordenflycht argues that past research leaves the term professional service firms either undefined or at best provides only examples, such as law firms, accounting firms, etc. In addition, he argues that while most scholars agree that law firms and accounting firms fit the definition of PSFs, there is little consensus on what the \u27etc.\u27 refers to. Does it include ad agencies? Physician practices? Software firms? Why or why not? (2010: 155). The author\u27s contributions include (1) identifying three distinctive characteristics associated with PSFs (i.e., knowledge intensity, low capital intensity, and a professionalized workforce), (2) arguing that while all PSFs share knowledge intensity, they may vary based on the degree of intensity of the other two characteristics (i.e., capital intensity and professionalized workforce), and (3) describing manage? rial challenges facing each structural form and providing solutions. In this dialogue we discuss the limitations of the proposed definition, question the managerial challenges von Nordenflycht associates with PSFs, and critique the corresponding solutions he offers

Characteristics of Intrapreneurs in Scale-Intensive Service Firms

This empirical paper explores the work of employees in charge of service innovation when firms develop and launch new scale-intensive services by addressing two research questions: i) How do employees responsible for service innovation work? and ii) what are the related managerial implications when developing and launching new scale-intensive services? To this end, 21 qualitative, in-depth interviews were conducted with employees in five large scale-intensive service firms. The findings suggest that the involvement of internal professionals is an asset when new scale-intensive services are developed, and that internal professionals act as intrapreneurs when they are involved in the development of radically new scale-intensive services. This paper integrates understanding from the innovation management literature with knowledge of professionals from extant literature on professional service firms since we find that professionals in scale-intensive firms act as intrapreneurs. Thus, this paper extends the theory on determinants of innovation in scale-intensive service firms, blending insights from both findings and theory

Creative Industry: Fact or Fiction?

In the late 1990's there was a growing realisation that for many 'post industrial' economies and especially the UK, not only had they become dominated by traditional 'service' businesses (banking, finance, retail, logistics, law and other professional service firms) but that the most rapidly growing group of these 'knowledge based' firms were in an ill defined sector that depended on creativity for their source of competitive advantage such as fashion, design, architecture, advertising and PR, books, music, film and TV production, theatre, online communities, video games, museum and gallery exhibitions and other print and screen based media. Many of these firms were young and rapidly growing, there were some large scale businesses in media and advertising but the majority stayed small and had a high attrition rate. In the UK they represented about 8% of GDP but crucially were growing at twice the rate of the economy as a whole. From a policy point of view they attracted a lot of interest - was this the holy grail of the future 'knowledge economy'? Now nearly 10 years on from the UK's declaration of 'cool Britannia' under Tony Blair's New Labour project, it is worth reflecting on what we really know about the 'Creative Industries and Creative Business'. Are they fact or fiction? and what might be the implications for education in the arts and management

The Enhancing Impact of Friendship Networks on Sales Managers’ Performance

This paper examines how relationships with friends moderate the impact of professional networks on sales performance. Based on a sample of 204 sales managers in a professional service company, this study presents evidence that friendship networks amplify the effect of sales forces’ professional networks on new product sales as well as on prospecting and converting new deals. Our results offer important insights into the socio-cognitive perspective of sales management literature and suggest that firms should encourage managers to improve their friendships in order to access valuable information that will enhance customer knowledge and support their sales efforts