Knowledge sharing effectiveness in public accounting firms.

• Author: Boonmunewai, Somjai
• Position: Report

1. INTRODUCTION

   Knowledge is the organizations' intellectual assets that may produce long-term sustainable competitive advantage. (Ndofor and Levitas, 2004; Syed-Ikhsan and Rowland, 2004; Hooff and Huysman, 2009; Hu et al. 2009) Following James B. Quinn in 1992, who identified the knowledge sharing as an importance value-driver in organizations because of its unique characteristic compared to other assets of a firm and will increase value when it is shared with and transferred to others (Sveiby, 2007; Yang, 2007). In addition, it is the outcome of satisfactory financial performance (Brachos et al., 2007; Hsu and Wang, 2008). All organizations are interested to improve effectiveness on knowledge. Because "the results of knowledge sharing practicing not only in the enhancement of employees' capabilities, but also the contribution to overall organizational effectiveness and bottom-line profit". (Yang, 2007) In the service industry, especially the public accounting service firm which knowledge and experience in services of client are creative in "new" products and services to keep and attract new customers which meet challenge on knowledge sharing. The processes of knowledge; creation, storage, sharing and transfer, are not a key factor leading to enhanced organizational performance; effectiveness knowledge application is. (Alavi and Leidner, 2001) On the prior research, most of literatures attempt to study what the factors build effectiveness of knowledge sharing. Also, a few evidence studies on knowledge sharing effectiveness (Brachos et al., 2007) as the antecedent of the model and have insufficiency of the dimensions for measure of the knowledge sharing effectiveness. Thus, this study is motivated by this point.

   The purpose of this study is to examine the relationships between knowledge sharing effectiveness and firm performance by using competitive advantage as a mediator and team culture and competitive environment as moderator. In this study, the key research questions for the paper are as follows: Firstly, how knowledge sharing effectiveness influences competitive advantage via moderator effect of team culture. Secondly, how competitive environment affects on the relationship between competitive advantage and firm performance. Finally, how competitive advantage mediates the relationship between knowledge sharing effectiveness and firm performance.

   An empirical study to determine the knowledge sharing effectiveness, competitive advantage and firm performance relationship is presented in this paper. This study will help determine whether adopting knowledge sharing effectiveness leads to positive innovation outcomes and firm performance effects. It will also help us identify what relationships seem to be significant, providing guidance to manager or executive, and in what practices may be worthwhile to adopt. In addition, the relationship among knowledge sharing effectiveness, competitive advantage, and firm performance may be moderated by external environment. Specifically, we will determine two operational principles, namely, team culture and competitive environment respectively. Moreover, the mediation effect suggests that concept of knowledge sharing effectiveness is more complex than what has been reported in previous research. Thus, competitive advantage as mediator is also provided for testing.

   The remainder of the paper is organized as follows. The second section provides the relevant literature and links to the hypothesis development. The third section describes the research methodology and the results of the study. Discussion is presented in the next section. Finally, contributions, limitations and directions for future research are offered.

2. RELEVANT LETERATURE

   The framework in Figure 1 was derived from the literature on the organizational learning and knowledge theory. (Brachos, Kostopoulos, Soderquist and Prastacos, 2007) The framework depicts the relationships among the knowledge sharing effectiveness as the antecedents and consequences. Competitive advantage as mediator (Bou-Llusar and Segarra-Cipres, 2006), and firm performance as outcome (Yang, 2007; Hu et al., 2008; Lee and MacMillan, 2008) via two moderating effects of the linkage relationship on knowledge sharing effectiveness with competitive advantage, and the linkage relationship on competitive advantage and the firm performance.

   2.1 Knowledge Sharing Effectiveness

   The definition of knowledge sharing effectiveness is "employees' exhibition of knowledge sharing behaviors and positive impacts on task performance". (Hsu and Wang, 2008) The effectiveness of knowledge sharing perceived usefulness on knowledge, which changes in behavior and improves organizational outcomes. (Levin and Cross, 2004; Brachos et al., 2007). The perception on usefulness of knowledge, which organizational changing and positively performance is sufficient proxy of knowledge sharing effectiveness. In addition, we define and measure the knowledge sharing effectiveness as task capability enhancement, service improvement, coordination efficiency and mentoring development.

   [FIGURE 1 OMITTED]

   Task capability enhancement implies that the employee's capability can improve the current task to overall effectiveness.

   Service improvement is defined as the new way of performing on the task within organization and improved the effectiveness in performing service task.

   Coordination efficiency implies to high level of mutual trust and trustworthiness among individuals in all processes and activities, which social interaction has strengthened among members of organizational.

   Mentoring development implies that the improvement of mentoring system which the novice is usually advised by the expert for the problem and techniques on practice.

   2.2 Knowledge Sharing Effectiveness, Competitive Advantage and Firm Performance

   Knowledge sharing effectiveness of organization is a major source of competitive advantages, which supports a business strategy (Hsu and Wang, 2008), and to organization performance. There is no common meaning for "competitive advantage" in accounting literature. Generally, in marketing's strategy literature has defined competitive advantage as "the distinctive capabilities of personnel" (Day and Wensley, 1988), which means relative superiority in skills and resources. Moreover, another meaning refers to "sources of super-normal returns" (Dyer and Singh, 1998).

   From the study of Hsu and Wang (2008) they found that the knowledge sharing policies and practices can improve knowledge sharing effectiveness and knowledge sharing policies and practices can lead to employees' knowledge sharing behaviors and improved task service to competitive advantage. Some studies show the knowledge sharing effectiveness as the indirect effect on competitive advantage such as through the incentives (Wolfe and Loraas, 2008), knowledge structure (Borthick, Curtis and Sriram, 2006). Furthermore, Dyer and Singh (1998) found knowledge sharing routines as the relationship between competitive advantage and firms. In addition, knowledge sharing has an effect on organizational effectiveness (Yang, 2007).

   Therefore, we hypothesize the positive relation between the knowledge sharing effectiveness with competitive advantage and firm performance as follows:

   Hypothesis 1: The knowledge sharing effectiveness: (a) task capability enhancement, (b) service improvement, (c) coordination efficiency, and (d) mentoring development, will have positive relation with competitive advantage.

   Hypothesis 2: The knowledge sharing effectiveness: (a) task capability enhancement, (b) service improvement, (c) coordination efficiency, and (d) mentoring development, will have positive relation with firm performance.

   2.3 Competitive Advantage and Firm...