Effective knowledge organisations (EKO) create dynamic capabilities through the acquisition, creation, sharing and retention of knowledge. These EKOs are designed to enable an organisation to improve best practices in business. As knowledge is different from other organisational resources, decision-makers ought to understand the importance of knowledge to an organisation. In order to fully utilise knowledge-management (KM) practices and to enhance efficiency, management should appreciate and understand the importance of KM. A proper understanding of KM will add value to organisational knowledge.
This study focused on investigating the knowledge-management practices at selected banks in South Africa. The objective was to establish the extent to which selected banks had implemented knowledge-management practices such as the acquisition, sharing and retention of knowledge.
Quantitative and qualitative data for this study were collected through the use of a multi-methods approach. Data were collected from middle and senior managers through the use of questionnaires and an interview protocol. All usable quantitative data were analysed using Survey Monkey and Microsoft Excel 2010 whilst thematic analysis was used to extract detailed, rich and complex data accounts from interviews.
Though the study revealed the presence of KM practices at selected banks, KM concepts were not universally understood, thus impeding the organisation-wide implementation of KM practices. Knowledge-management practices were only discussed as a footnote because no formal policies existed to add value to KM initiatives.
The study concludes that organisations such as banks should perform a knowledge inventory. Knowledge inventories will become handy during the process of developing KM policies and practices for integrating work processes, collaborating and sharing (including the efficient use of knowledge technology platforms) and developing an enabling institutional culture.
As pointed out by (Gaffoor & Cloete … an established management approach that is successfully applied across corporate sectors by methodically creating, sharing, preserving and optimally applying the extensive knowledge present in the organisation, to better achieve organisational objectives. (p. 254)
The above definition captures fundamental issues that are used in discussing KM practices in this study. In this regard, Cong and Pandya ( … any given control mechanism has the capacity to affect both the nature and flow of knowledge in a firm by the manner in which the firm processes particular attributes of knowledge. (p. 27)
The South African banking environment is characterised by intense competition, thus compelling the players to use strategies and create knowledge assets that are difficult to imitate. For an institution to remain competitive and relevant in a knowledge environment, there are opportunities to create, own, protect and use commercial and industrial knowledge assets which are difficult to copy. The South African banking industry comprises four commercial banks, namely ABSA, FNB, Nedbank and Standard Bank whilst the other banks focus on unsecured lending (personal loans). FNB and Nedbank were selected for this study for the following reasons:
FNB was chosen because it is the second largest South African commercial bank (after ABSA) in terms of staff complement, assets and branch network (Moneyweb
Nedbank was selected because the first author was formerly employed by the bank. This means that permission to conduct a study on Nedbank was already granted, and recruiting participants for the study was relatively easy.
Selecting one bank would have sufficed, but because a comparative approach is utilised in this study, it is of paramount importance to extrapolate different research issues. If two or more cases show to be supporting the same theory, replication can be claimed, and the greater the number of case studies that show replication, the greater the rigour with which theory has been established (Rowley
The banking customers’ ever-changing tastes and preferences require banks to proactively improvise products, exit projects and product lines that can drag down the business and engage in others that maximise the growth potential as radical market shifts threaten to put the bank's business with the wrong product. By rapidly exploiting and applying fragmented internal and external knowledge, a bank can reliably detect emerging windows of opportunity before competition takes the market by surprise. This study investigated the extent to which selected banks in South Africa have implemented KM practices such as the acquisition, sharing and retention of knowledge.
The literature review was used to establish how other scholars investigated the same problem. The purpose of reviewing a variety of scholarly thinking was to look at what other scholars have done in areas that are similar or have a relationship to this study (Leedy & Omrod Information professionals need to develop the capabilities to survive in knowledge based society, there is need for organisations such as banks to invest in information and knowledge architectures to produce more knowledge. Investments can be in the form of databases systems, patents and tacit knowledge which when fully utilised in the organisation can produce streamlined processes and high quality services and products. (pp. 177–178)
These outputs from a knowledge-based organisation should add value to the organisation as well as provide value for customers.
Pacharapha and Ractham (
KM practices help organisations to refocus on using knowledge that exists already by ‘… creating an environment for innovation rather than limiting themselves to best practice solutions only’ (Laudon & Laudon … as the wilful application and transfer of one or more person's ideas, insights, solutions and knowledge to another person(s), either directly or via an intermediary, such as a computer-based system. (p. 412)
The definition by Turban
Knowledge may be shared during seminars, conferences, team-building exercises, written reports, performance appraisals and conventional programmes where employees make suggestions. Discussion fora give people opportunities to share personal experiences about a particular event. Seminars and conferences are ideal platforms for ‘shy’ or ‘less vocal’ employees to talk freely and openly with their colleagues. Platforms for knowledge sharing should make the communication process easier for different categories of employees. Sentiments or opinions expressed during seminars or conferences should not be used as personal attacks, and managers should not use these events to settle personal scores. Knowledge sharing can encounter challenges such as a lack of time, a lack of experience and a lack of visible rewards for sharing knowledge.
Kim (
Wamundila and Ngulube (
We used multiple methods in the study to improve the reliability and validity of the data collected, culminating in the collection of a rich set of data (triangulation). Multi-methods research was designed to guarantee the reliability and validity of quantitative measures (Romm & Ngulube in press). An embedded case-study design offered the opportunity to explore in depth the extent to which banks have implemented KM practices such as the acquisition, sharing and retention of knowledge. Embedded case studies are studies in which different levels or sources of data are collected (Yin
Questionnaires were used to collect data from geographically dispersed participants whilst interview protocol and document analyses were ideal for collecting qualitative data. Questionnaires were distributed and received through Survey Monkey©, an online survey platform. A total of 190 questionnaires were distributed to middle-level managers at the selected banks. The questionnaire comprised open-ended questions that allowed the participants to give as much feedback as possible. A set of pre-designed, open-ended questions were used during the interview process to ask participants questions on KM policy issues that were not addressed in the survey.
All quantitative data were analysed using Survey Monkey© and Microsoft Excel© 2010 whilst thematic analysis was used to analyse qualitative data. Using the constant comparative method of analysis (Leedy & Ormrod
Of the 190 questionnaires distributed, 101 (53.15%) responses were received, which is consistent with the findings of Greenlaw and Brown-Wetty (
Respondents were asked to indicate KM practices and to what extent their bank had implemented KM practices. All study participants indicated that the acquisition, sharing and retention of knowledge are practiced at their bank. The study established that selected banks use different KM practice though a few of these KM practices were indeed found to be similar. The study identified the following KM practices.
The data in
Knowledge-management practices at selected banks.
Knowledge-management practices at selected banks | Nedbank ( |
FNB ( |
Total number of respondents ( |
---|---|---|---|
Departmental meetings and team-building sessions | 12 (11.89) | 6 (5.95) | 18 (18.84) |
Succession planning | 7 (6.93) | 4 (3.96) | 11 (10.89) |
Use of the intranet and Internet | 9 (8.91) | 6 (5.94) | 15 (14.85) |
Road shows | 4 (3.96) | - | 4 (3.96) |
Tea or lunch breaks | 5 (4.95) | - | 5 (4.95) |
Seminars | 3 (2.97) | - | 3 (2.97) |
Facebook, Wikis, Blogs and Twitter | 6 (5.94) | 2 (1.98) | 8 (7.92) |
Staff promotions/secondment | 3 (2.97) | - | 3 (2.97) |
Mentorship | 4 (3.96) | - | 4 (3.96) |
Project teams | 5 (4.95) | 3 (2.97) | 8 (7.92) |
Innovators campaign | - | 7 (6.93) | 7 (6.93) |
Training centre | - | 5 (4.95) | 5 (4.95) |
Extension of retirement age | - | 3 (2.97) | 3 (2.97) |
Knowledge portals | - | 3 (2.97) | 3 (2.97) |
Suggestion boxes | - | 4 (3.96) | 4 (3.96) |
TOTAL | 58 (57.43) | 43 (42.57) | 101 (100) |
Eleven (10.89%) of the respondents believed that succession plans enable selected banks to retain organisational knowledge. The study established that succession planning is designed to ensure the continued effective performance of selected banks by providing for the deployment and replacement of key people over time. Participants indicated that lateral transfer and redeployment are a common practice at selected banks. Though redeployment and lateral transfer are common, this study could not establish if the motive was in line with KM initiatives. ‘Effective succession or talent-pool management concerns itself with building a series of feeder groups up and down the entire leadership pipeline or progression’ (Noe
Respondents indicated that the intranet and Internet play a key role as evidenced by a response rate of 14.85%. Technology facilitates communication between management and employees as well as quick access to, the search for and the retrieval of information. Dewah (
As shown in … a program comprising a series of marketing events that companies organise at multiple locations to generate interest regarding a subject that they want to promote. It could about new products/services targeted at customers, new investment offerings targeted at investors, new social initiatives targeted at the community and so on. (p. 476)
These marketing events are usually conducted by the chief executive officer or managing executive of the bank in the case of Nedbank. They use the executive to add dignity and credibility to the roadshow as well as to attract high-profile individuals in society. The study revealed that road shows were conducted at Nedbank's regional head offices in Sandton, Pretoria, Polokwane, Cape Town and Durban, thus isolating other towns or cities.
Tea and lunch breaks are platforms used to discuss social issues as evidenced by 4.95% of the respondents from Nedbank. Knowledge sharing platforms during tea or lunch breaks are not used at FNB as indicated in
Nedbank respondents (2.97%) stated that seminars are environments where participants socialise and create and share knowledge with their colleagues. This finding is consistent with Nonaka and Konno (
Interactive communication channels are tools such as emails, short message services, Facebook, WhatsApp, Twitter, Blogs, Wikis and BlackBerry messaging that handle, store, locate, distribute, receive and communicate tacit and explicit knowledge through social networks amongst people in possession of knowledge. Eight (7.92%) respondents confirmed the use of interactive communication channels at selected banks. Dewah (
The study established that knowledge retention is achieved through the use of staff promotions and secondment as evidenced by 2.97% of respondents from Nedbank. Participants from FNB did not indicate the use of staff promotions and secondment as a knowledge retention practice. The study established that staff were promoted on the basis of years of experience, opportunities that arose due staff attrition and as part of Nedbank's succession planning policy. However, it was not clear if staff promotions were in any way aligned to knowledge-management initiatives.
The subject expert or experienced employee transfers tacit knowledge to the inexperienced employee (Nonaka
The study found that selected banks have assembled groups of individuals to perform activities that contribute toward achieving a common task-related goal. The study established that product development, systems development, marketing campaigns and training and development projects are managed by project teams consisting of skilled workers from the same or different function areas. Eight (7.92%) of the respondents indicated that assignments or tasks at the selected banks are managed by retirees or experienced employees. They provide critical skills and experience to mentor junior and less-experienced employees, thus allowing senior employees to share knowledge and experiences during project management.
Seven (6.93%) of the respondents (from FNB) stated that the innovators campaign is a great success story for knowledge-creation and sharing because FNB's success is attributable to rewards and incentives awarded for innovation. The website Moneyweb ( First National Bank awarded R4 million in 2009 to winning ideas through its FNB Innovators initiative, in a bid to improve its service delivery and at the same time motivate staff to higher levels of excellence. The initiative identifies and rewards staff who display creative thinking and come up with innovations to ensure more efficient and effective systems and procedures. (n.p.)
In addition, the Steve campaign, eBucks and eWallet exemplify innovation initiatives at FNB, and individuals who came up with those concepts were rewarded for creative thinking. The study recorded that the innovators campaign is an important KM practice at FNB. This practice was not found at Nedbank.
Results shown in
The risk of losing critical knowledge has a negative operational impact for organisations. This could be reduced by knowledge retention through capturing the organisations’ individual tacit knowledge and subsequently transforming it into organisational knowledge and document processes. Critical knowledge in some of the banks’ departments largely rests with people rather than in processes. When such people leave the bank, they take with them that critical knowledge. If the expertise of these senior or experienced people is not shared or transferred to the next employees, the potential to innovate is eroded, and the risk of unavoidable mistakes increases as these become a regular occurrence. It was established that the retirement age at FNB is not fixed to give both the employer and employee room for negotiation. Three (2.97%) respondents indicated that a policy on extending the retirement age exists at FNB whilst such a practice does not exist at Nedbank.
The study recorded that knowledge portals (2.97%) and suggestion boxes (3.96%) are used for knowledge sharing at FNB, but there are no knowledge portals at Nedbank. Knowledge portals provide the infrastructure and enabling technology to support the creation, production, acquisition, aggregation, filtering, organisation, transmission, dissemination, usage and/or retention of knowledge. If the computer of today is a network, the desktop of today is a portal (FNB 2011/12). As suggested by Dewah (
The study noted that there are times when knowledge is relevant, and there are times when knowledge is not relevant. The point is that organisations need to use knowledge as soon as it becomes readily available. It was established that information use leads to knowledge-creation, which is possible if an organisation's management creates an enabling knowledge sharing culture. An environment that promotes knowledge acquisition is an environment where employees are provided with ‘… spaces for emerging relationships, which might be physical, virtual, or mental, providing a platform for advancing individual and/or collective knowledge’ (Nonaka & Takeuchi
The knowledge assets of selected banks were found in places like databases, filing cabinets, Internet, intranet, extranets, annual reports and people's heads. The use of the intranet exposes staff to readily available information in order to acquire as much new knowledge as possible. Consequently, some relevant knowledge is acquired through bulletins posted on the intranet, but the veracity or relevance of the knowledge needs to be questioned. It was not clear whether management at selected banks are formally accepting and adopting knowledge as a strategic organisational asset. The banks’ reports did not feature the KM practices in their mission statements or core philosophies. However, the FNB self-study of 2011 reveals that KM principles are in fact resident within the Information Technology Department. This finding is also complemented by Nedbank's self-study of 2011, which states that the Group Technology Shared Services (GTSS) is the custodian of knowledge practices. From this information, it is clear that banks misconstrue IT to be knowledge.
Patrick and Dotsika (
The process of keeping useful knowledge inside the banks and building organisational memory (OM) is documented in the selected banks’ reports. This knowledge is preserved and kept in very safe places to ensure knowledge retention. It was established that KM awareness is limited as reflected in the following statement:
… there did not appear to be a documented inventory of the banks’ skills base, or evident records of succession planning, even if the banks’ annual reports suggested that there were career development practices. (FNB 2011/12; Nedbank Group South Africa 2012)
The absence of documents to indicate the progress on implementing KM practices could possibly explain why the cultures prevailing at the selected banks were not in favour of knowledge retention. In the event of the loss of key staff in these banks, management would have to revert to contingency measures to mitigate the loss in tacit knowledge.
This study noted that knowledge acquisition is a sub-set of knowledge capture because the knowledge acquired at the selected banks came from such sources as individuals and their colleagues as well as the intranet, Internet, documents and databases (Mavodza & Ngulube
The data for this study was both quantitative and qualitative in nature. Therefore, I needed to combine the data (triangulation) to provide answers to the research questions. The depth, clarity, reliability, transferability and truthfulness of the research findings are enhanced when two sets of data are put together. It should be noted that quantitative data are represented in numerical and graphical format whilst qualitative data are more descriptive. It was important to combine quantitative and qualitative data to ensure that relevant data was collected to address the KM practices that were investigated in this study. When multiple research methodologies are used, challenges abound when one tries to combine divergent paradigms. The challenges include the following: It is possible to end up by not doing either type of research well, especially as this research was done by an individual (Fidel
The study noted that KM practices at selected banks are based on the organisational knowledge conversion theory, that is, the SECI model. The conversion of organisational knowledge rests on the premise that knowledge is converted from one state to another (Nonaka & Takeuchi
The sharing of tacit knowledge also manifested itself in the card and IT divisions of the selected banks. The study also established that tacit knowledge is transferred to fellow employees in the card division regarding trends in the credit-card payment industry, asset finance and personal loans. Through emails, intranet, electronic bulletin boards, training and brainstorming activities, tacit knowledge is transferred from one employee to other employees. Computer technology makes it possible for the organisational knowledge to be spread across the entire organisation (Nemani
SECI Model: Innovation in selected banks.
The study established that a culture that promotes the creation of new knowledge in the organisation is vital because this allows organisations to create new knowledge from shared and existing knowledge repositories. The new knowledge must be preserved and retained as knowledge assets in appropriate media. Albers (
It was noted that a lack of knowledge-management practices leads to high costs due to a loss of institutional memory, knowledge gaps and uninformed decisions. Managing knowledge in a bank can leverage efficiency across all of its services to customers through accessing the right information for making informed decisions and eliminating duplication of efforts. Baskerville and Dulipovici ( … one of the characteristics of the economic school of KM as incorporating the ability to be a learning organisation that enables creativity and in the process increases the value generation capacity of an organisation. (n.p.)
The study established that knowledge enhances organisational performance as shown by 21.78% of the surveys though the point was raised by 17.83% of the respondents that a combination of knowledge and business strategies enhances organisation performance. Surveys and interviews concurred that, in the knowledge economy, organisations leverage efficiency across departments, thus improving service delivery and processes. This was evidenced by 13.86% of the respondents who viewed KM as a solution to business problems whilst 11.88% of the respondents felt that KM enhances customer relationships. Building relationships with customers or suppliers is regarded as a competitive strategy (Kotler & Keller
Building long-term relationships with suppliers and customers will enable the selected banks to leverage such relationships for growth. Nine (8.91%) of the respondents stated that knowledge-management improves work processes whilst 6.93% of the respondents stated that KM improves product and services development – an important factor required to address the ever-changing tastes and needs of customers. An organisation that has technology and processes that produce products and services within a shorter space of time than competitors usually satisfies customers (Kotler & Keller
KM practices in the banking situation should be actions aimed at improving the internal flow and use of information and knowledge, and banks can be a major participant in these activities. Examples of such practices include the creation of ‘best practices’, databases, regular training and development programmes as well as the encouragement and promotion of employee interaction within departments and between individual staff and departments (Nonaka & Takeuchi
The study established that knowledge at selected banks is not properly managed to facilitate the implementation of competitive KM practices for surviving in the knowledge economy. Being a dynamic competitive and information-intensive industry, bankers should possess skills that include the identification of knowledge needs, distinguishing knowledge-management from information management which can facilitate a broader and more inclusive KM initiative. This could result in the development of a KM framework for sharing institutional practices that include all employees – an important component of a KM strategy. From the findings presented in this study, it is recommended that the low level of KM practices at selected banks would be mitigated if there were clear KM policies and plans in place. From a structural perspective, it is recommended that the position of chief knowledge officer be established to formulate KM policies and drive all KM initiatives.
The authors declare that they have no financial or personal relationships which may have inappropriately influenced them in writing this article.
Both J.C. (University of South Africa) and P.N. (University of South Africa) conceptualised the study and then the first author did the research as part of his PhD study. Both authors were involved in writing up of the article and dealing with comments from the reviewers and the Editorial Board.