8Wagner.qxd


There is increasing enthusiasm about the wonders delivered by

the newest information technologies in an era characterised by

knowledge as the critical resource for business activity. The

ushering in of the knowledge society is described in literature

(see Chattell, 1995; Drucker, 1995; Giddens, 1990) as being a

revolutionary transformation in our conceptions of what

knowledge is and the way that we regard the role of knowledge

in a post-industrial society (Sieloff, 1999).

Before the literature on knowledge management is reviewed, a

contrast between the way in which information is viewed in

Industrial Age and 21st century organisations may be useful. The

environment of the 20th century was stable and predictable,

with a domestic market orientation. Organisations could afford

to avoid risks and to focus on internal affairs; organisations were

characterised by top-down control, rigidity and hierarchy. Size

was seen as a sustainable competitive advantage in competing

for contemporary markets. Top management closely guarded

information using it as an instrument of control where

information flowed via the organisational hierarchy (Sveiby,

1997). Organisations operated relatively independently from

each other and were pre-occupied with the streamlining of

activities, rather than with results (Kiernan, 1996).

In contrast herewith, the environment of the 21st century is

characterised by discontinuous change, ambiguity and hyper

competition. Speed and responsiveness are of the utmost

importance. Organisations have to be flexible, proactive and

creative to survive and information needs to be shared between

organisation members and even bet ween different

organisations. Information is thus a tool for communication - a

resource – and flows via ‘collegial networks’ (Sveiby, 1997).

Thus, the 21st century organisation will look and function very

differently from its Industrial Age counterpart in terms of the

management of information. Virtual organisations will be

established with networks of employees, associates, suppliers,

shareholders and customers communicating more and more

through digital technology. Interactive communication will

become more important than physical locations. The

brainpower of the intelligent business will be the knowledge

workers as key creative professionals (Management Trends

International, 1998).

The impact of globalisation, technology, diversity and other

environmental trends calls for a paradigm shift in management

thinking. Organisations that are struggling to cope with the

changing pace of their operational and competitive environments

could explore concepts such as knowledge management,

organisational learning and collaboration (Dove, 1999). In other

words, for organisations that want to survive and be successful in

the 21st century, there are new rules with different boundaries

requiring new and different behaviours inside the boundaries

(Luthans, 1995). With the change in behaviour that organisations

will experience, new ways of defining, generating and

understanding knowledge are implied.

There are however, paradigmatic differences in the under-

standing of what knowledge is. Traditional definitions of

knowledge often equate it to content (Fahey & Prusak, 1998). In

the 21st century organisation, knowledge is equated to process

because the demands of new organisations require novel ways of

creating and sustaining knowledge. The fusion of information

and insights from people and information technology will result

in the creation of different boundaries with the consequences of

different behaviours in the 21st century organisation. Selective

filters were applied to the dissemination of knowledge in the old

organisation whereas in the 21st cent ury organisation

technological advances have made it possible for knowledge to

be available and accessible at multiple levels.

Research that took place in a traditional organisation was based

on collecting information. Information in this context was

passive, something ‘out there’ that had to be gathered and made

available to be used when needed (van Ewyk, 1998). Inherent in

this description of information is the lack of acknowledgement

CLAIRE WAGNER

NAFISA CASSIMJEE
Department of Psychology

University of Pretoria

HANNIE NEL
Market researcher

ABSTRACT
As the Knowledge Era replaces the Information Age the challenge is to transform information into knowledge and

use this knowledge to create and sustain the competitive advantage of organisations.  In this article four key

principles for implementing knowledge management are discussed.  These principles were derived from a survey and

discussions with employees at a small software company.  The four principles are: the need for a common definition

of and vision for knowledge management, the interdependence between the human and technology track, the way

employees punctuate ‘knowing’ and the structure of a reward system for sharing knowledge.

OPSOMMING
Organisasies word gekonfronteer met unieke uitdagings soos wat die Kennisera die Inligtingsera vervang.  Een van

die grootste uitdagings is om inligting te verander na betekenisvolle kennis en om die kennis te gebruik om ‘n

kompeterende voorsprong te skep en te bou.  In hierdie artikel word vier kern beginsels vir die implementering van

kennisbestuur bespreek.  Die beginsels is geskoei op ‘n opname van en onderhoude met werknemers in ‘n klein

sagteware besigheid.  Die vier beginsels is: die behoefte aan ‘n definisie en visie van kennisbestuur, die

interafhanklikheid tussen mense en tegnologie, die wyse waarop werknemers kennis punktueer en die skep van ‘n

beloningstruktuur vir die deel van kennis.

SOME KEY PRINCIPLES IN IMPLEMENTING 

KNOWLEDGE MANAGEMENT: THE VIEWS OF 

EMPLOYEES IN A SMALL SOFTWARE COMPAN Y

Requests for copies should be addressed to: C Wagner, Department of Psychology,

University of Pretoria, Pretoria, 0002

49

SA Journal of Industrial Psychology, 2002, 28(2), 49-54

SA Tydskrif vir Bedryfsielkunde, 2002, 28 (2), 49-54



of the interpretive processes of observing systems. In the new

organisational context the conditions under which ‘knowing’

occurs and how knowledge is reconstituted are constantly

changing (Scarbrough, 1999). Van Ewyk’s (1998, p. 2)

understanding of knowledge is that “it is a step beyond

information” in that knowledge is produced by meta-

interpretations of information. The internal dissemination of

knowledge in the new organisation should parallel the dynamic

conditions underlying knowing.

Young (in Stadler 1999) and Van Ewyk (1998) agree that there are

different points of view on what exactly knowledge management

entails. Sveiby (2000, p. 1) identifies strongly with the human

resources perspective and defines knowledge management as

“the art of creating value from an organisation’s intangible

assets”. Knowledge management entails “radical and

fundamentally new ways to create, share and leverage what each

company has, and how to account for it” (Young in Stadler, 1999,

p. 19). Young sees the fusion of technology, people and processes

as essential in knowledge management. In short, knowledge

management combines two fields: information technology and

human resources; knowledge management is not either

technology or people, but incorporates both and more.

Sveiby (2000) provides a description of the two tracks in

knowledge management: the information technology track and

the people track. Within the information technology track

knowledge management is seen as the management of

information. It is about using information technology to

leverage knowledge within a company. Thus, the main

emphasis is on tools and techniques for capturing, analysing

and distributing information such as data-warehousing and

data-mining and concepts like the internet, intranet, extranet

and collaboration software (e.g. e-mail, online chat groups,

shared documents and so on) are dealt with. According to

Young (in Stadler 1999, p. 19) “new technologies have emerged

that enable teams to better communicate, co-operate,

collaborate and co-own projects in ways that have simply not

been possible before”.

The sharing of knowledge using innovative technology, however,

creates a paradox. With greater accessibility to knowledge comes

the difficulty with grounding it in a specific context. To

overcome this paradox it is necessary to focus not so much on

processes of communication, but on changing the context for

such processes (Scarbrough, 1999). The sharing of knowledge

between members of the organisation creates new networks

through which knowledge itself can be redefined in diverse

contexts that are themselves continuously changing.

The human resources component deals with organisational

change where knowledge management is viewed as the

management of people. The people track, although still in its

infancy concerning knowledge management applications, is

vital to an organisation’s abilit y to innovate and build

environments that will enable the creation of new knowledge.

Any organisation can purchase knowledge management

software, but the ability to create a sustainable creative

organisation, according to Sveiby (2000), is difficult.

Innovation, therefore, is the only competitive advantage that an

organisation has. Spady and Schlebusch (1999, p. 18) state that

“organisations need and rely on capable, self-starting,

innovative and adept employees who can do ‘smart work’,

‘think outside the box’, want to learn continuously and

improve how they operate, and perform on the cutting edge to

help their organisations flourish”.

Just as an organisation would invest in information technology,

it is also important to invest in people, recruitment, the office

environment and so on. Trust between people (management and

employees) is paramount. Sveiby (2000) termed this the ‘band-

width of human infrastructure’. While information technology

has pioneered the concept of knowledge management, it is

essential that the human element should not be ignored.

Knowledge management implies an interdependent relationship

between people and technology. According to Young (in Stadler,

1999) technology enables knowledge management, while people

are the key to the knowledge management process.

Whilst the literature indicates important considerations for

implementing a knowledge management strategy there is a

paucit y of research on employees’ perceptions of the

implementation process and the underlying principles of its

success. The aim of this article is to explore and describe

employees’ concepts of knowledge management in a small

soft ware company and to make recommendations for

implementation that takes employees’ perceptions into account.

METHOD

Research design

A software company requested an internal survey of employees’

perceptions of implementing a knowledge management strategy

(as part of their general climate study) due to the lack of

information on this topic and subsequent guidelines on how to

include employees in this process. Due to the fact that the

questions on knowledge management were part of the general

climate study in the organisation that yielded only quantitative

data the researchers decided that follow-up interviews be

requested with willing participants to gather more in-depth

information about salient points identified quantitatively. The

combination of quantitative and qualitative methods allowed

for a convergence of information from different sources (Kelly,

1999). This use of triangulation enhanced the validity of the

study (Richardson, 1996).

Sample

The organization has a structure with three levels: Level 1

comprises top management (2 people), level 2 senior

management (2 people) and level 3 web consultants (35 people).

This company is in the process of implementing a knowledge

management strategy. The employees perform various tasks

such as selling and developing websites and are therefore

computer literate. For this st udy the respondents were

conveniently selected on the basis of their willingness to

participate in the study both for the questionnaire and

interview phases. Nineteen employees responded to the

questionnaire: one from management (level 1 and 2) and

eighteen from level 3. Their ages ranged from 18 to 32; eight

were female and eleven were male. Eight (3 females and 5

males) of the respondents indicated on the questionnaire that

they would be available for follow up interviews.

Measurement

The researchers constructed a questionnaire by formulating

questions based on current knowledge management literature

and in co-operation with the management of the company. The

structured questionnaire consisted of four sections: general

dimensions of knowledge management, knowledge management

technologies, benefits of knowledge management and the main

barriers to knowledge management implementation. In sections

one and two respondents were asked to rate items on a 5-point

Likert scale where 1 = strongly disagree and 5 = strongly agree.

Using this format increased the comparability of responses to

the different questions (Babbie, 2001) and enabled the

researchers, by including a neutral choice in the middle of the

scale (Neuman, 2000), to identif y respondents with no opinion

or those who avoided making a choice. No cases of a respondent

constantly choosing the neutral position were found and thus all

the data were used for further analysis. Examples of items from

sections one and two are: ‘Employees are willing to share their

knowledge’, ‘the company has a structure which facilitates the

sharing of knowledge’ and ‘knowledge management is purely a

technological solution’.

WAGNER, CASSIMJEE, NEL50



In sections three and four respondents were asked to mark the

items they considered to be beneficial and main barriers to

implementing knowledge management in their company.

Examples of these items are: ‘faster response time’, ‘better

decision making’ and ‘product innovation’ (benefits); ‘lack of

time to share knowledge’, ‘lack of understanding knowledge

management’ and ‘insufficient technology’ (barriers). The

questionnaire was designed in an HTML format and placed on

the company’s network. Employees were notified via e-mail of

its availability. Javascript language was used to export the data

directly to a spreadsheet.

The semi-structured interviews were arranged with the eight

follow-up respondents. As an employee of the company the

interviewer was familiar with the interviewees which aided

rapport. The possible influence of this familiarity on the validity

of the results was minimised by the interviewer assuring the

interviewees of their anonymity as well as not tape recording the

sessions. Notes were therefore compiled during the interview

and these were used as the protocols for analysis.

Analysis

For the purpose of this article items pertaining specifically to

knowledge management strategies were selected for analysis, as

other items were included in the questionnaire as part of a broader

study that pertained to the general operations of the company.

Descriptive statistics were used to analyse the quantitative data;

frequencies, means and standard deviations were calculated. In

sections three and four of the questionnaire the frequency of

responses was determined and then rank ordered.

The qualitative protocols were analysed separately by two

researchers. Protocols were read to identif y meaning units or

codes. The codes were then condensed into broad categories

and finally condensed further into interrelated themes. The

two researchers compared their identified themes and these

were collated by means of consensus discussions as to which

themes would be included in the final thematic list. This

dialogical inter-subjectivity is defined by Kvale (1996, p. 65) as

an “agreement through a rational discourse and reciprocal

critique among those identif ying and interpreting a

phenomenon”. Engaging in this dialogic process enhanced

communicative validity.

RESULTS

Respondents were asked for their views on knowledge

management and the strategies for its implementation. The

quantitative data is presented as follows: general views on

knowledge management, knowledge management technologies,

benefits of implementing knowledge management and the

barriers to knowledge management implementation. Following

these results the qualitative data is presented to provide a 

richer description of employees’ overall ratings of knowledge

management. 

Descriptive statistics

Table 1 outlines the mean scores of employees’ ratings of items

related to the overall strategies for the implementation of

knowledge management.

TABLE 1

MEAN SCORES OF EMPLOYEES’ RATINGS OF KNOWLEDGE

MANAGEMENT STRATEGIES

ITEMS N M SD

People and their responses are critical to the success of 19 4.47 0.61 

knowledge management

The sharing of knowledge should be guided by an 19 4.26 0.56

overall knowledge management strategy

There should be a reward system to encourage the 19 4.21 0.85

sharing of knowledge

The knowledge management process should be led by 19 4.16 0.76

a knowledge manager

Cross functional teams is a key success factor in 19 4.00 0.67

knowledge management

People see IT as part of their normal working practice 19 3.84 0.76

Knowledge management is purely a technological 19 2.78 0.73

solution

From Table 1 it is evident that the respondents are in consensus

that people drive the knowledge management process.

Technology is not the most important part in the imple-

mentation process. In a discussion on new organisations,

Chattell (1995) emphasised that the transformation of

organisations is not solely driven by implementing technology.

Table 2 contains respondents’ ratings of technologies needed to

implement knowledge management. 

TABLE 2

IMPORTANCE OF KNOWLEDGE MANAGEMENT TECHNOLOGIES

ITEMS N M SD

Internet 18 4.50 0.99

Document management systems 19 4.11 0.99

Data warehousing/mining 17 4.06 1.09

Intelligent search agents 18 4.06 1.06

Intranet 19 3.89 1.24

Decision support systems 18 3.78 1.11

Corporate portal 16 3.63 0.96

Extranet 18 3.50 1.29

The high mean scores for all the items indicate the importance

of these enabling structures for achieving successful

implementation. Despres and Chauvel (1999) found that

intranets and knowledge bases formed an integral part of the

information sharing process in organisations.

Improved productivity is regarded as one of the main benefits of

knowledge management as outlined in Table 3.

TABLE 3

THE BENEFITS OF KNOWLEDGE MANAGEMENT

ITEMS RANK ORDER

Improved productivity 1

Better decision making 1

Employee development 2

Faster response time 3

Better customer-handling 3

Product innovation 4

Better morale 5

The main barriers to knowledge management implementation

are presented in Table 4:

PRINCIPLES IN IMPLEMENTING KNOWLEDGE MANAGEMENT 51



TABLE 4

THE MAIN BARRIERS TO KNOWLEDGE MANAGEMENT

ITEMS RANK ORDER

Ineffective communication 1

Lack of funds 2

Lack of senior management commitment 2

Lack of time to share knowledge 3

Lack of understanding knowledge management 4

Insufficient technology 5

People are not willing to share knowledge 6

Little personal benefit for users 6

It would appear that employees recognize that the main

obstacles to the implementation of a knowledge management

strategy are not confined to an individual level such as

willingness to share knowledge but are more on an

organisational level such as ineffective communication. 

Interview data

In response to the question “How do you see knowledge

management?” participants’ definitions included the following

common elements:

� Structured process

� Ordered process

� Flexible system

� Adaptable system

� Distribution system

� Shared system

In the respondents’ understanding of knowledge management

the terms process and system were used interchangeably. The

structured and ordered nature of knowledge management was

important to employees because they perceived it as a

fundamental element to accessing knowledge within the

company in an efficient manner. For the respondents, the idea of

efficiency means that information has to be shared regularly and

can be applied to diverse contexts “for the right people, the right

information, and at the right time”. The process encapsulated by

respondents indicates a strategic management system of

intellectual capital that is derived from the organisation’s

‘collective knowledge reservoir’. According to Pérez-Bustamante

(1999) individuals sharing knowledge and experiences in an

organisation create these knowledge reservoirs. The respondents

suggested that antecedents to the establishment of a shared

system include the existence of a knowledge base within each

individual and the willingness of people to impart their

knowledge. Although some common elements exist in the

definitions of knowledge management, the employees gave

different views on what exactly it entails. The implications of

these differences for implementing knowledge management will

be discussed later.

Collating the data from Table 3 with the themes identified from

the qualitative protocols, it appears that productivity is linked to

more than just the efficient sharing of information. Effective

leadership and communication from management enhance

psychological variables such as motivation, attitude and interest.

Respondents emphasised that in order to enjoy the advantages of

a knowledge management system these organisational

dimensions should precede the implementation phase.

Respondents also recommended the development of a reward or

incentive platform to facilitate the processes necessary for

implementation. Discussions with respondents yielded various

ideas on the incentive package. These included a reward system

that was tangible (financial benefit) and a reward system that was

intangible (being acknowledged for having and sharing the

knowledge). The dividends of this acknowledgement pertained

to issues of power and respect within the company. In essence,

respondents propose that a better decision-making system is a

direct result of people “learning faster to interpret and use

information in a dynamically changing environment”.

The following key drivers were identified in the protocols and

qualif y the meanings attributed to the main barriers to

knowledge management implementation presented in Table 4:

� Multilevel communication

� Dynamic leadership

� Commitment

� Cutting edge technology

� Reward platform

Respondents suggested that communication from top

management is the driving force to the effective implementation

of a knowledge management system. On another level, however,

the employees of the organisation are willing to take leadership

responsibilities as long as the fundamental implementation

strategies are put in place by management. For employees to

effectively manage the process on their level, communication

must not be on an arbitrary basis, in a piecemeal fashion, done

hastily or be asynchronous. Issues concerning trust are stated as

barriers to knowledge management implementation and

respondents suggest that this arises from poor communication

and a lack of effective leadership which creates an environment

where “employees receive pieces of the puzzle and then have to

piece it together and then get very confused”. Although a people-

centric track is emphasised by respondents, the need for advanced

technology in several areas is stipulated as a key driver for

knowledge management implementation. Respondents suggested

that in addition to the necessary tools there should be a technical

knowledge management structure, which could include a server

that provides accessibility to a centralised database.

DISCUSSION AND RECOMMENDATIONS

The researchers would like to emphasise four key principles in

the implementation of knowledge management that were

identified from the results. The first principle concerns the need

for a shared definition of and vision for knowledge management

in the company. From the literature discussed in this article and

the communication from employees it seems that a single

definition of knowledge management is elusive. Due to unique

views of what knowledge management is, a difficult situation is

created for employees, as they are unsure of how knowledge

management should be implemented if there are no specific

directives from management. Although a shared definition is

elusive, employees concur that a shared context is essential to

managing knowledge. Fahey and Prusak (1998) define shared

context as employees having a common understanding of the

connection between the internal and external environment of

the organisation.  The prerequisite for aligning the shared

context in an organisation is establishing and maintaining open

channels of dialogue and critical debate about what knowledge

is and how it should be managed. The networking of people in

an organisation is vital to the success of effective knowledge

exchange (Ruggles, 1998; Wiig, 1998).

The second key principle is contained in the belief that

acknowledgement of employees’ role in the dialogical process is

accompanied by a responsibility for observations, descriptions

and explanations. The paradigm shift that organisations need to

make to distinguish between information and knowledge

compels them to recognise the context of mutually defining

relationships that punctuate employees’ knowing activities. How

the employee punctuates and develops his or her system of

knowing and acting is dependent on how the dialogical process

impacts on current power structures and emerging experiences

of empowerment. Pérez-Bustamante (1999, p. 8) recommends

WAGNER, CASSIMJEE, NEL52



that “… the organisation should undertake a proactive approach

to achieve the internal dissemination of knowledge,

independently of where it was created and how it was deposited”

although the autonomy of employees should be encouraged so

that they feel free to express their opinions and share their

knowledge. In this regard, there should be a search for diversity

and complexity in the organisation so that the changes that take

place in the work environment can be successfully contained.

There may be a catch, however, as according to Pérez-Bustamante

(1999, p. 12): “some individuals may perceive that the possession

of information grants them a special power and communicating

this knowledge could provoke a loss of their competitive

advantage”, which may lead to feelings of disempowerment. The

creation of ways to deal with such issues is a major challenge

that must be overcome for the successful implementation of

knowledge management. Central to this is the idea of reflexivity,

which plays a part in recreating the role of employees and their

relationship to management. Scott (1997b) lists reflexivity as

one of the five attributes of the emerging knowledge society.

Reflexivity in this context alludes to the interaction between

what an employee may describe of specific events and how that

description is also part of the event. By engaging in the ‘reflexive

turn’ organisations can promote the equal validity of the

employees’ voices as well as emphasising and analysing the

employees’ role in constructing the knowledge process and the

results thereof (Burr, 1995).

A third key principle is concerned with employees’ recognition

of the importance of developing an appropriate reward system

that can be coupled to sharing knowledge. A KPMG report (1998)

found that employees want to be rewarded for taking initiatives

to implement knowledge management as well as participate in

determining the structure of incentive packages. One suggestion

is that employees be allowed to participate in self-enhancement

activities in return for sharing their knowledge. When

employees participate in knowledge sharing the conventional

reward structures that are designed to deal with immediate

monetary reward do not always apply. This is because the

benefits of knowledge management are contained in long term

processes. The incentive packages have to be designed to include

‘factored non-monetary’ rewards that can be given to employees

based on the mutual definition of roles in the knowledge

process. Fahey and Prusak (1998) and Teece (1998) have

suggested ways of quantif ying the value of the intangible assets

created by implementing a knowledge management strategy.

One example of this is attaching value to the intellectual

property when a company sells a patent.

The fourth key principle is the interdependence between the

human and technology tracks. Although technology can be

used to capt ure, develop and distribute knowledge this

knowledge cannot originate or fully exist independent of a

person. Investing solely in technology is a one-dimensional

approach to change and transformation that discounts the

existence of two distinct forms of knowledge. The first form is

explicit knowledge, which is something that can be categorised,

stored, published and distributed. It includes databases about

employees’ skills, the buying behaviour of customers, and so

on. This type of information is usually available within a

company and knowledge management programmes are

established to deal with this type of knowledge. The second

form, tacit knowledge, is more difficult to define. It is

“developed through experience, thinking, observation and

intuition” (Backweb Technologies, 2001, p. 2), it is “in the

minds of people” (Miller, 1999, p. 2). Focusing solely on the

technology track fulfils the criteria for explicit knowledge

generation. Tacit knowledge can only be created within a

knowledge management strategy when the organisation realises

that the people factor is vital; “if technology solves your

problem, yours was not a knowledge problem” (Ruggles, 1998,

p. 88). Organisations that embrace new technologies should not

do so to replace the contributions of employees but rather to

amplif y their potential (Chattell, 1995).

Establishing a successful knowledge management strategy is

dependent on a knowledge-based culture and a proactive

approach to communication (Pérez-Bustamante, 1999). In other

words the common definitions of knowledge management

should be constructed within the organisational environment.

Central to this is the stochastic process known as learning.

Learning is stochastic in the sense that it combines random and

selective processes in such a way that only certain outcomes of

the random are allowed to endure. Random processes in this

sense refer to the innovative knowledge behavioural repertoires

performed by individuals in the organisation. The successful

outcomes of these random behaviours that endure are related to

an order of learning that Bateson (1972) called deutero-learning.

Learning of this kind may be described as learning how to learn.

This means that employees would look for strategies for trying

out new behaviours, and those strategies that yield success

survive, become part of the collective knowledge reservoir and

are incorporated in the structural capital of the organisation. In

order for deutero-learning to be established and maximized the

knowledge management environment should incorporate the

hierarchical structure of the knowledge process.

It is therefore recommended that the primary task for any

organisation wanting to implement a knowledge management

strategy begins with creating working common definitions of

knowledge pertinent to that organisation. The definition of

knowledge as a process inseparable from those who create it

allows employees to use technology as an enabler rather than

as a replacement thus balancing the human-technolog y

interface. The negotiated balance bet ween people and

computers is encapsulated in the employees’ punctuation of

their knowing activities and the boundaries of such activities.

These functions have tangible and intangible outcomes and

therefore the reward system must incorporate these elements

in order to maintain the principles of a knowledge

management strategy.

The key principles outlined by the respondents suggest that

knowledge management embodies organisational processes that

seek a synergistic combination of data and the information

processing capacity of information technologies, and the

creative and innovative capacity of human relations. The

creation of knowledge occurs on many levels and is influenced

by the organisational context, technological media and the

human-technology interface.

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