Knowledge Management And Organizational Performance: Case Of State Owned Commercial Enterprises In Kenya

This study sought to establish the relationship between knowledge management and organizational performance of state owned commercial enterprises in Kenya. The specific objectives of the study were to examine the relationships between knowledge management processes that included knowledge acquisition, knowledge creation, knowledge conversion, knowledge sharing and knowledge storing on organizational performance of state owned commercial enterprises in Kenya. Further, the study sought to examine the moderating effect of age of the firm on the relationship between knowledge management and organizational performance. Positivism research philosophy and descriptive and explanatory research designs were utilized. The study targeted a population of 275 members of top management team in 55 state owned commercial enterprises in Kenya. Simple random sampling was used to select a sample of 268 members of top management team. A pilot study of 10% of sample size of 27 members of top management team was randomly selected to participate in the pilot. The Cronbach’s Alpha value for the questionnaire was 0.81 indicating that the research instrument was reliable. The study conducted correlation analysis, One-Way Analysis of Variance (ANOVA) and multiple linear regression to test the hypotheses and the results are discussed as follows. 

Multiple regression results showed that knowledge acquisition, knowledge creation, knowledge conversion, knowledge sharing significantly predicted return on equity but not return on asset. Knowledge storing did not have significant influence on return on assets and return on equity. Age of the firm moderated the relationship between return on equity and knowledge acquisition, knowledge creation and knowledge conversion and not return on assets. The study recommended that state owned commercial enterprises should ensure effective knowledge management processes are applied in their companies in order to improve their organization performance.