A Structural Model of Knowledge Management across Borders

Knowledge has been cited as the most important strategic asset for managing innovation in the hyper-competitive environment of the 21st century. However, the sharing and creation of knowledge at the organizational level is a difficult process that will not proceed without incentives and conscious efforts by management. The complexity of knowledge management is further compounded by the influence of a wide variety of factors such as leadership, ba, organizational culture, organizational characteristics and individual work styles. Based on a large dataset gathered from a questionnaire survey of a multi-national Japanese pharmaceutical company and its subsidiary in the United States, we compare how the aforementioned organizational factors influence the processes of knowledge management, expressed through the SECI model of socialization, externalization, combination and internalization. Results of a structural equation modeling path analysis show that although part of the same corporate group with similar goals, the two companies' knowledge management programs were affected by very different organizational factors. This implies that knowledge management activities need to be tailored to the organizational idiosyncrasies of each local office, without betraying the global vision of a corporation.