Organizacija, Volume 50 Research Papers Number 2, May 2017

DOI: 10.1515/orga-2017-0008

Model of Knowledge Management

Factors and their Impact on the
Organizations’ Success
Domen Kozjek1, Marija Ovsenik2

1
Faculty of Organization Studies Novo mesto, Novi trg 5, 8000 Novo mesto, Slovenia
domen.kozjek@gmail.com

2
Alma Mater Europaea ECM, Slovenska 17, 2000 Maribor, Slovenia
mara.ovsenik@gmail.com

Purpose: The purpose of this research is to identify the factors of knowledge which have a significant impact on the
outcome (measured as value added per employee) of the company. The existence, long-term survival, profitability,
etc. of the company depends on the competitiveness of the products and services (regardless of industry or eco-
nomic branch). Transformation of “raw materials” into competitive products is possible only with the knowledge of
employees. Therefore, it is necessary to identify the factors of knowledge which can influence a positive result of the
company.
Methodology: We reviewed the relevant literature in the field of knowledge management. On this basis, we sum-
marized the factors of knowledge. We performed a survey among the 69 largest Slovenian commercial companies
(public and banking sectors excluded). Based on the research, we developed a regression model of value added per
employee in euros.
Results: The study showed that, of all factors studied, motivation in the form of assessing employees’ performance
has the largest positive correlation with the value added per employee. Furthemore, training for the performance,
the use of technological tools and organizational climate can bring significant value added per employee. The most
important factor that affects the value added per employee is the industry branch which the company deals with. The
factors which follow are the simplicity of using IT tools and the example that the managers give to the employees.
Conclusion: A model of knowledge management factors helps to identify which knowledge factors should be given
priority to for increasing the company’s performance. The model also considers the industry in which the company
operates.

Keywords: Knowledge management; knowledge factors; human capital

1 Introduction edge management capabilities on knowledge management

effectiveness (Bharadwaj, Chauhan, Raman &, 2015), the
Continued development and rapid distribution of informa- existence of a company primarily depends on the success
tion technology caused a cyclical - continuous struggle for of the intellect materialization of its employees and their
market share and fight for every customer between manu- intellectual potential. Therefore, it is crucial to understand
facturers and suppliers of similar products. As demonstrat- the importance and impact of the knowledge of those in-
ed by several studies, e.g., Linking intellectual capital and volved in the production process, development department
intellectual property to company performance (Bollen, and commercial activities.
Vergauwe & Schnieders, 2005, 1182) and Impact of knowl- Our primary objective was to analyse the relationship
1

Received: October 27, 2016; revised: February 4, 2017; accepted: March 3, 2017
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Organizacija, Volume 50 Research Papers Number 2, May 2017

between the factors of knowledge and value added per creases, because faster manufacturing cycle (also invest-
employee as indicator of economic performance of the ments in company development and increased commercial
company. Consequently, our secondary objective was to activities) of the product results in greater competitiveness
propose a model that explains the relation between the fac- on the market, forcing the competition to adapt to the new
tors of knowledge and value added per employee. The mo- situation or withdraw from the market. Such a continuous
tive of the survey was to discover whether the knowledge process leads to an increasingly competitive environment
available in the company can provide a better management which offers survival only to those organizations that are
of the company in terms of increasing its revenues. In our able to produce products with value added, based on inno-
research question, we wanted to find out which factors are vations. Innovations are the result of a creative business
most important, and how and to what extent they affect the environment that is stimulated by the market demand or
performance of the organization, with the benchmark of also crisis (Ovsenik & Ovsenik, 2015, 155). The condi-
the company being the value added per employee in euros. tion for increasing production is the result of knowledge
or knowledge – innovation correlation (Hsu & Shen, 2005,
355). Moreover, generally only the third generation of
2 Literature review and theoretical products following the introduction of KM delivers the
basis benefits of the innovation process, the first and the second
generation bring only advantages from synergies and opti-
2.1 Knowledge, inovativeness and com- mization of working processes (Hsu & Shen, 2005, 355).
petitive environment In today’s competitive world, the value of organizations
is based on the intellectual capital. Therefore, knowledge
Critical skills to the company’s success in the business is power that can bring changes and improvements with
environment are the creative ideas and knowledge which which the organizations aim to maintain long-term sus-
the company can realize at the right time and in the right tainable growth and development (Akhavan, Hosnavi, &
market (Ovsenik and Ambrož, 2010, 78). Knowledge is a Sanjaghi 2009, 283).
multifaceted concept with a multifaceted range of mean-
ings and is defined as a justified true belief which results 2.2 KM factors
in a value increase (Nonaka, 1994, 21). On the other hand,
Bhatt (Bhatt, 2001, 70) notes that data is a set of raw facts There has been a lot of research done on the subject of
which by means of processing and organizing turn into knowledge and its relationship to the organizations‘ per-
information, whereas knowledge is a piece of logically formance. We focused on qualitative and quantitative find-
completed information. Knowledge can be classified as ings of some of the research studies. They offered us tested
tacit knowledge or explicit knowledge (Nonaka, 1994, 19). framework and the scientific matter for the study. Based on
Tacit knowledge is knowledge, which can not be defined qualitative case studies and findings on knowledge man-
(Smith, 2001, 313). Smith defines tacit knowledge as auto- agement, it has been confirmed that the most important
mated knowledge which requires very little time for taking internal KM factors are the organizational infrastructure
a decision. It can be said that this is collective behavior and employee’s motivation (Davenport & Prusak, 1998,
and collective consciousness of the organization (Smith, 159) or “knowledge management is the management of
2001, 314). It can also be considered as a structural con- people and vice versa” (Davenport & Volpi 2001, 218).
cept that describes the relationship between different types Similar to Davenport and Prusak, authors Wong and As-
of knowledge (Gupta, Iyer, & Aronson, 2000, 17). Explicit pinwall (2005, 74-75) also confirmed the hypothesis that
knowledge is academic or technical data (or only infor- the most important internal KM factors which affect the
mation) described in formal language (Smith, 2001, 316). result of the company (measured in value added per em-
Examples of explicit knowledge are manuals, mathe- ployee) are organizational culture, organizational infra-
matical expressions, copyrights and patents (Smith, 2001, structure and employee’s motivation. Later, a more recent
316). Seen from the distance, the development of the com- study (Impact of knowledge management capabilities on
pany is directly connected to the development of employ- knowledge management effectiveness) confirmed that the
ees (regardless of their position in the company) and their organizational infrastructure is a very important internal
knowledge. Various authors (e.g. Hsu & Shen, 2005, 355) factor that has a significant impact on improved communi-
researched the link between the life cycle of the product, cation, collaboration and exploitation of knowledge within
knowledge and development of the company. Knowledge the organization. All the above mentioned has a positive
management (KM) is a systematic approach to improving effect on productivity.
the organization’s ability to mobilize knowledge for the They also found that organizational culture is deep-
purpose of making more precise decisions in the formula- ly rooted among the employees in the organization and
tion of business strategies (Hsu & Shen, 2005, 354). When requires a lot of effort to change. Larger companies are
the life cycle of the product reduces, the role of KM in- managed centrally, therefore it is easier to change their

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organizational culture as in smaller organizations, which, turnover as well as incorrect selection technology (Frost,
from this perspective, gives them an advantage in the im- 2014). The authors Luo and Lee (Luo & Lee, 2015, 62-
plementation of KM (Bharadwaj, Chauhan, Raman &, 69) propose the inclusion of a special procedure - “failure
2015, 430). Empirical research by Valmohammadi (2010, mode” in the KM strategy with the goal to prevent errors
920) showed great deviations from the findings by Dav- during the implementation of KM strategies.
enport, Wong and Aspinwall. They noted that rewarding Immediately, when a deviation is detected, the process
and motivating employees were insignificant factors in the of determining causes and the start-up of elimination pro-
medium-sized companies. However, other factors, such as cedure is initiated. They suggested a list of potentially dan-
limitations in the implementation of KM, education and gerous deviations from the implementation of KM strate-
training of the employees and the relevance of human re- gies, which are evaluated with the critical factors, and the
sources, were identified as very important in achieving the procedure to eliminate the deviation (Luo & Lee, 2015,
organization’s objectives. Valmohammadi (2010) notes 62-69). Another important aspect of KM is transfering the
that it is important to distinguish between large and small experience from the elderly to the younger. Recent surveys
companies while exploring KM. Moreover, the results also show a correlation between KM and the protection of
obtained should be interpreted correctly, for example, the intellectual property. Intellectual property (in terms of pat-
KM factor which is ranked the highest in the survey needs ents, stored knowledge in the form of products, etc.) can
to be addressed prior to the other factors by the manag- be understood as a form of KM, therefore, it is necessary
ers. The empirical research on a sample of 301 selected to protect it and increase the cumulation of human capital
respondents in major private and public research centers, in companies, with a view to identify market opportunities
(Akhavan, Hosnavi, and Sanjaghi, 2009, 283-285) re- (Manuel, 2016, 62). Table 1 presents a list of the literature
vealed that the scope of KM consists of three important on which we built the factors of knowledge. Literature is
groups of factors. The first group, human resources man- reproduced according to the article Akhavan, Hosnavi, &
agement, consists mainly of concepts that are the founda- Sanjaghi (2009, 276-288). We updated the literature and
tion of the KM system in the organization. These include: we also replaced (Table 1, highlighted in bold) those parts
organizational culture, collaboration and communication which relate to the cultural and organizational differences
among employees, motivation, teamwork and job secu- (original study from a different cultural environment).
rity. The second most important group is KM (storage,
transmission and renewal of knowledge). The third group
of factors involves certain issues which are more general 3 The research method and hypoth-
in comparison to the other two groups. These are neces- eses
sary for the successful establishment of the organization
not only of a KM system. These factors are measurement, The survey questionnaire is reproduced from the research
transparency and support of the company’s management of the author Valmohammadi (2010, 915-924). We looked
(Akhavan, Hosnavi, & Sanjaghi 2009, 283-285). at the knowledge in organizations from 31 perspec-
Many studies, for example, the research by Tasmin, tives – hereafter defined as elements of knowledge. For
Rusuli, & Hashim (2010, 9-11) in companies dealing with the purposes of analytical data processing, we combined
multimedia, revealed that successful knowledge manage- the 31 elements of knowledge into 12 meaningful sets of
ment within the company depends heavily on the behavior “knowledge factors” (Table 2). When reducing the ele-
of the employees. In cases where all of the employees do ments of knowledge into the knowledge factors, we used
not participate in the exchange of knowledge, no matter the methodology used in the study (Valmohammadi 2010,
how good and how strong their information technology, 915-924). We connected the elements of knowledge with
culture or organizational structure is, KM does not reach knowledge factors from the questionnaire (the question-
the targets. Furthermore, the establishment of KM in com- naire states which knowledge elements belong to a certain
panies does not guarantee progress, if the implementation knowledge factor). For proper connection, we reviewed
and strict adherence to the strategy do not follow the de- the literature from Table 1. The hypotheses are based on
fined KM objectives. A common cause for poor KM re- the 12 knowledge factors resulting from the examined lit-
sults is exactly its incomplete implementation (Brahma & erature (Table 1).
Mishra, 2015). In addition to that, the lack of the man- Table 2 shows the link between the elements and fac-
agement support, poor control over the results, improper tors of knowledge, where a factor of knowledge is defined
planning and misplaced organizational structure also occur as a logical unit, consisting of different elements of knowl-
as negative factors. These can be understood as “causal” edge. The table shows the elements that we combined into
for the poor implementation of KM. However, there are our knowledge factors.
also negative factors that occur as a result of KM, these are Table 3 shows the structure of the questionnaire, result-
the improper planning of resources, shifting responsibility ing from the links between the elements and the factors.
for tasks, loss of knowledge due to retirement and staff Respondents were asked to respond to the question

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Table 1: Reference literature of factors of knowledge

Source: Adapted from Akhavan, Hosnavi and Sanjaghi (2009, 276-288) and supplemented with recent sources.
Knowledge elements Source
Transparency, trust and organizational culture ⋅ (Akhavan, Jafari, & Fathian, 2006, 97-113)

⋅ (Luo & Lee, 2015, 62-75)

Database and technological tools for knowledge searching ⋅ (Davenport E., 2001, 61-75)
Documentation of knowledge ⋅ (Davenport & Volpel, 2001, 212-221)
Measuring performance ⋅ (Moffett & McAdam, 2009, 44-59)

⋅ (Bharadwaj, Chauhan, & Raman, 2015, 421-434)

Comparative analysis ⋅ (Moffett & McAdam, 2009, 44-59)

⋅ (Frost, 2014)
Structure of knowledge ⋅ (Davenport & Prusak, 1998)

⋅ (Bharadwaj, Chauhan, & Raman, 2015, 421-434)

Management of changes ⋅ (Ovsenik & Ambrož, 2006)
Knowledge exchanging ⋅ (Davenport & Volpel, 2001, 212-221)

⋅ (Mustafa, Lundmark, & Ramos, 2016, 273-295)

Company’s willingness for KM strategy ⋅ (Akhavan, Jafari, & Fathian, 2006, 97-113)
Systematic approach to KM ⋅ (Akhavan, Jafari, & Fathian, 2006, 97-113)
Knowledge and measurement of knowledge ⋅ (Wong & Aspinwall, 2005, 64-82)
Architecture of knowledge ⋅ (Skyrme & Amidon, 1997, 27-37)

⋅ (Brahma & Mishra, 2015)

Continuous learning ⋅ (Skyrme & Amidon, 1997, 27-37)

⋅ (Luo & Lee, 2015, 62-75)

Creating knowledge ⋅ (Skyrme & Amidon, 1997, 27-37)

⋅ (Manuel, 2016)
Administrator of knowledge ⋅ (Moffett & McAdam, 2009, 44-59)
Organizational structure ⋅ (Ovsenik M., 1999)

⋅ (Ovsenik & Ambrož, 2010)

Repositories and transmission of knowledge ⋅ (Davenport E., 2001, 61-75)

⋅ (Kim, Mukhopadhyay, & Kraut, 2016, 133-156)

Knowledge management ⋅ (Davenport & Prusak, 1998)
Teamwork ⋅ (Šumanski, Kolenc, & Markič, 2007, 102-116)

⋅ (Jafari, 2015, 82-93)

Information infrastructure ⋅ (Wong & Aspinwall, 2005, 64-82)

⋅ (Kim, Mukhopadhyay, & Kraut, 2016, 133-156)

Cooperation and communication ⋅ (Drucker, 2001)

⋅ (Mciver, Lengnick - Hall, Lengnick - Hall, & Ramachandran,

2013)
KM integration with existing systems ⋅ (Moffett & McAdam, 2009, 44-59)

⋅ (Kim, Mukhopadhyay, & Kraut, 2016, 133-156)

Knowledge and winning organization ⋅ (Coulson - Thomas, 2007, 108-112)

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Table 1: Reference literature of factors of knowledge (continued)

Job security ⋅ (Egbu, 2004, 301-315)

⋅ (Frost, 2014)
Climate in the organization ⋅ (Wong & Aspinwall, 2005, 64-82)
Human resources management and motivation ⋅ (Egbu, 2004, 301-315)

⋅ (Jafari, 2015, 82-93)

Flexible and dynamic organizational structure ⋅ (Bukovec, 2009, 4-23)
Management support and commitment to the goals ⋅ (Davenport & Volpel, 2001, 212-221)

⋅ (Bukovec, 2006)
Awareness and understanding of employees ⋅ (Garrick, Chan, & Lai, 2004, 329-338)
Training and education of employees ⋅ (Garrick, Chan, & Lai, 2004, 329-338)
Teamwork and problem solving ⋅ (Zarraga-Oberty & De Saa-Perez, 2006, 60-76)

⋅ (Jafari, 2015, 82-93)

Chart 1: Reduction of knowledge factors into hypotheses

“To what extent do these arguments apply to a company in eral. We added hypothesis 5 that was not included in the
which you are employed (rating from 1 to 6)?”. We chose reference research (Akhavan, Hosnavi, & Sanjaghi 2009,
an even graduated scale because we wanted to avoid arith- 277-283). Respondents could respond to the listed hypoth-
metic central responses. eses by CONFIRM or REJECT. With the study, we wanted
Table 4 is presenting links between the factors of to identify the factors of knowledge that affect the perfor-
knowledge and the hypotheses. mance of the organization, so it was very important that
In formulating the hypotheses, we based on the already the respondents identify KM - knowledge as a potential
conducted research (Akhavan, Hosnavi, & Sanjaghi 2009, factor impacting the performance of the organization. The
277-283). The hypotheses were partially summarized last hypothesis allowed us at least a partial view of the sin-
from the mentioned research, the difference being in the cerity of the answers. If the respondent decided to reject
elements of knowledge. With the H1 and H2, we wanted to the first four statements and confirmed the fifth, this would
check whether KM (or what managers believe) is detected mean that we could reasonably suspect the validity of the
as a part of the innovation process and if the KM, according responses and we eliminated the complete questionnaire.
to the employees’ opinion, participates in the realization of The same applies to the contrary, e.g., if the respondent
the company’s objectives. The same applies for H3 and rejected the last statement and confirmed the other four.
H4. We wanted to determine whether KM is recognized as
a positive factor that contributes to the company’s success.
We adjusted the reference literature (Table 1) for design- 4 Sampling, conducting a survey
ing the elements of knowledge in the fields which deviate and analysing
from the environment in which we conducted the research.
In particular, these areas relate to the cultural aspect, the Our target research group were managers, researchers or
organizational structure and understanding of work in gen- people who make essential decisions in an organization.

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Table 2: Link between factors and elements of knowledge

Knowledge factor Knowledge elements
Factor 1: Management leadership and support Teamwork
Management support and commitment to the goals
Transparency, trust and organizational culture
Factor 2: Organizational culture Climate in the organization
Organizational structure
Cooperation and communication
Awareness and understanding of employees
Factor 3: Information technology Database and technological tools for knowledge searching
Information infrastructure
Factor 4: KM strategy Company’s openness for implementing KM strategy
Knowledge management
Administrator of knowledge
Knowledge and measurement of knowledge
Factor 5: Performance measuring Benchmarking
Teamwork and problem solving (measuring the effectiveness of
cooperation on challenges)
Factor 6: Infrastructure of the organization Documentation of knowledge
Knowledge exchanging
Repositories and transmission of knowledge
Factor 7: Processes and activities Architecture of knowledge
Systematic approach to KM
Creating knowledge
Factor 8: Rewarding and motivation Human resources management and motivation
Knowledge and winning organizations
Factor 9: Elimination of restrictions Job security
Factor 10: Training and education Continuous learning
Training and education of employees
Factor 11: Human resources management Flexible and dynamic organizational structure
Change management
Factor 12: Comparative analysis KM integration with existing systems
Measuring performance
Structure of knowledge

The sample included people who are heads of development list includes most economic activities in which the compa-
departments, managers and experts. In terms of education, nies are engaged in general and, from the revenue point of
respondents were in most cases highly educated (Table 5). view, present the largest proportion regarding to the total
We collected the data for our research from a nonrandom numbers of activities. We carried out a parallel test of the
sample of companies. correctness of the data published by the web application
We targeted all the companies that were listed in the Gvin1. The review showed that there were no deviations
article “300 biggest and best Slovenian companies in from the published data.
2010” (Bertoncelj Popit, 2011), which included data about Before carrying out the actual survey, we conducted a
value added per employee. The list of companies included pilot study to determine whether the measuring instrument
300 of the biggest companies in Slovenia, excluding the is appropriate. The respondents were selected among the
financial sector. All companies gave consent prior to the authors’ colleagues and acquaintances. All of them met the
publication of data in the electronic version of Delo. The conditions for the target population in terms of education
1

1 Web service that allows registered users an insight (in Slovenian registered companies) into business, ownership share,
market developments, etc. (Internet source).
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Table 3: Factors of knowledge and survey questions

Source: Reproduced from the questionnaire (Valmohammadi, 2010, 915-924).

Factor 1: Management leadership ⋅ Alignment of KM strategy with busi- ⋅ Motivating employees to use new knowl-
and support ness strategy. edge.
⋅ Managers act as catalysts for KM. ⋅ Visibly rewarding employees who share
⋅ Managers create the necessary con- Factor 5: Performance measuring their knowledge.
ditions for KM. ⋅ Measurement of the benefits of KM ⋅ Rewarding employees for successful team-
⋅ Managers act as an example to show depending on initiatives stemming work.
the desired behavior. from KM. ⋅ Motivating work performance by means of
⋅ Managers encourage knowledge cre- ⋅ Monitoring the progress of the devel- assessment system.
ation, sharing and use. opment of the KM.
⋅ Managers recognize KM as an im- ⋅ Assessing the impact of KM on finan- Factor 9: Elimination of restrictions
portant factor that contributes to the cial performance. ⋅ Provision of funds for investment in KM.
business success. ⋅ Updating of indicators (financial and ⋅ Sufficient funding investment for the con-
⋅ Managers show attachment and sup- the organizational climate ones) for struction of KM technological system.
port of KM. measuring KM. ⋅ Ensuring sufficient human resources to cre-
⋅ Measuring the value of intellectual ate new knowledge.
Factor 2: Organizational culture capital. ⋅ Providing employees with time for knowl-
⋅ High organizational culture that val- edge management related activities.
ues knowledge and problem solving. Factor 6: Infrastructure of the orga-
⋅ A high degree of trust among em- nization Factor 10: Training and education
ployees is important when exchang- ⋅ The company has a knowledge trust- ⋅ Training on the concept of knowledge and
ing knowledge. ee (administrator of knowledge, etc.). KM.
⋅ Frank exchange of errors between ⋅ The company defines the roles and ⋅ Training on the use of KM systems and
employees without fear of punish- responsibilities for the purpose of tools.
ment. carrying out the tasks of KM. ⋅ Training individuals to assume roles related
⋅ Collaboration between employees is ⋅ The company has a clearly defined to KM.
important. ownership of the initiatives arising ⋅ Training to develop knowledge skills such
⋅ Encouraging of teamwork among from the KM group. as creative thinking, problem solving, com-
employees. ⋅ The company has a flat organizational munication, team building, etc.
⋅ Empowering employees to explore structure of the KM working groups. ⋅ The possibility that employees are involved
new possibilities. Factor 7: Processes and activities in both internal and external learning oppor-
⋅ Encouraging people to ask ques- ⋅ Generating new ideas and knowledge. tunities such as conferences, training semi-
tions. ⋅ Documenting the key skills and nars, etc.
⋅ Accepting the exchange and sharing knowledge.
of knowledge (not accumulation) as ⋅ Effective classification and storage of Factor 11: Human resources management
organizational strength. knowledge. ⋅ Employment of workers in order to fill gaps
⋅ Improving procedures for finding the related to knowledge.
Factor 3: Information technology necessary knowledge. ⋅ Employment of workers due to their posi-
⋅ The use of an appropriate system for ⋅ Sharing knowledge with the use of tive attitude to knowledge.
managing KM. electronic media or personal contact. ⋅ Rewarding employees for the purpose of
⋅ Using technological tools (tools ⋅ Communication (formal and infor- retaining.
for collaboration, knowledge base, mal) among employees. ⋅ Providing opportunities for career promo-
search engines, document manage- ⋅ Immediate implementation of best tion.
ment systems, intelligent systems, quality knowledge in products and
etc.). services. Factor 12: Comparative analysis
⋅ The utilization of intranet or internet. ⋅ Promotion of continuing education at ⋅ Constant care for benchmarking system per-
⋅ Easy use of technology. all levels. formance (measuring the usefulness of KM
⋅ Relevance of KM system according ⋅ Providing for the protection of initiatives with regard to financial or non-fi-
to the user’s needs. knowledge assets from unauthorized nancial indicators of the company).
exposure or theft. ⋅ Encouraging employees to compare with
Factor 4: KM strategy other organizations.
⋅ Having clear goals and objectives of Factor 8: Rewarding and motivation ⋅ Establishing the internal mechanism with a
a shared vision that employees sup- ⋅ Guaranteeing the right motivators view to coordinating the company’s strate-
port. to encourage the production of new gy, budget and human resources manage-
⋅ It is necessary to develop a KM strat- knowledge. ment.
egy at any cost.
⋅ Having clear tasks and clearly de-
fined objectives of KM.

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Table 4: Link between the hypotheses and the influential factors of knowledge management

Hypotheses Influential factors of knowledge management

H 1 - Knowledge management creates innovation pro- Factor 7: Processes and activities
cesses. Factor 8: Rewarding and motivation
Factor 9: Elimination of KM restrictions
H 2 - Knowledge management realizes the company’s
Factor 4: KM strategy
strategies.
Factor 5: Performance measuring
H 3 - Knowledge management creates conditions for Factor 2: Culture of the organization
the competitiveness of the organization. Factor 6: Infrastructure of the organization
Factor 3: Information technology
H 4 - Knowledge management provides the founda-
Factor 10: Training and education
tions to new knowledge.
Factor 11: Human resources management
H 5 - Knowledge management helps to the success of Factor 1: Leadership management and support
the organization. Factor 12: Comparative analysis

and the workplace. We conducted a survey among 21 peo- 5 Results

ple by interviewing them personally, using the question-
naire in printed form. The collected data was processed When gathering the companies, we realized that 14 (4.7%)
using the SPSS programme. We focused on data reliability of the companies from our range had ceased their activi-
analysis calculating Cronbach’s coefficient α (alpha). The ties for various reasons, therefore 286 or 95.3% of the ini-
selected respondents filled the questionnaire twice, be- tially planned electronic invitations were sent. In 97 cases
cause the first time we did not reach the minimum value of (33.9% of all outgoing emails), we received notice that
Cronbach’s coefficient α of 0.7; the average of all factors the e-mail address does not exist anymore. We concluded
was 0.54. Therefore, the questionnaire was corrected, es- that these were mainly companies, which ceased to exist
pecially in terms of further clarifying the survey questions. since the list had been published. A total of 71 completed
Some questions were reshaped and some of them exclud- questionnaires (24.8%) were returned. We excluded four
ed, because we realized that they did not contribute to the responses from the analysis because they were incomplete.
further clarification but in certain aspects even gave rise to Responses came from 28 men and 34 women, five respon-
doubts into questions that had already been answered. The dents did not indicate their gender. The average age of the
revised questionnaire was tested again in the circle of col- participants was 43.2 years.
leagues and acquaintances but this time among different
people. The second pilot study included 19 people. In this 5.1 Testing hypotheses
case, the critical value for Cronbach coefficient α (alpha)
was reached (0.76). To analyze the reliability of the questionnaire, we used the
As a tool for collecting survey responses on-line, we Cronbach’s coefficient α (alpha). We checked whether the
used Google documents - Forms (Do more in cooperation responses vary because of different opinions of the respon-
with other office applications with Google Drive, 2013). dents, and not because the survey was unclear or because
Only the selected companies could access the question- multiple-choice questions could have several explanations
naire. The invitations for filling out the questionnaire were (Cronbach, 1951, 297-334). We confirmed or rejected the
distributed by e-mail. They listed all the relevant informa- hypotheses in the following successive steps:
tion about the study, the recipient of the invitation (it was 1. We reviewed the responses according to each hypoth-
intended for managers, researchers or people in organi- esis. The respondents evaluated each hypothesis by
zation who make crucial management decisions) and the Confirm of Reject. The first four hypotheses repre-
electronic link to the online form. We deliberately avoided sented the arguments that we wanted to test. The fifth
the e-mail addresses that included personal names, so that and final hypothesis was a test and a partial indica-
the respondents would not regard (perceive) them as spam tor of the sincerity of the answers. In two cases the
and delete them. Therefore, we prefered using e-mail ad- respondents confirmed the first four hypotheses, but
dresses such as info@company.si. not the last one. This clearly indicates that we may
reasonably doubt in the accuracy of the results, so
we eliminated the two questionnaires. None of the

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Table 5: Position in the company and the educational level of respondents

* The person who carries out the tasks but has the possibility of influencing on the decisions regarding the tasks.

Job position/ Master’s High Higher

PhD Specialization College No response Total
education degree school education
Manager* 2 3 2 5 8 6 2 28
Expert 2 1 2 5 3 2 15
Head of
3 3 2 1 5 6 1 21
department
(no response) 1 2 3
Total of 5 8 5 8 19 15 7 67

Table 6: Industry branch in which the company operates

Human
Activity of No
Other Finance Informatics Resources Management Manufacturig Marketing Total
the company response
Department
Count 7 10 6 10 8 10 10 6 67

Table 7: Workplace of the respondens

Industry branch of the company Count

Commerce 13
Other service companies 10
Other industries 7
Food industry 9
Energetics 6
Telecommunications and media 5
Metal industry 5
Automotive industry 3
Tourism 2
Construction 2
Transporting people and goods 2
Pharmaceutical industry 1
Insurance 1
Chemical industry 1
Total 67

respondents confirmed the final hypothesis, but not and 2 have the same interval distance).
the first four. 3. For each hypothesis, we have tried to establish (by
2. Each of the hypotheses, as we have already explained, means of the factor analysis - PCA method) the ex-
is based on the influential factors (Table 4). To con- istence of latent (hidden) variables, which could
firm the hypotheses, we determined the following explain the greater part of the variability of the hy-
rule: The arithmetic mean of all the sub-questions (on potheses, and whether the observed latent variables
a scale from 1 to 6) must be at least 3.5 (x ≥ 3.5) with (factors) can be usefully applied to the hypotheses.
the distribution within + - 1.3 of the standard devia-
tion. We assumed that the Likert scale has the same We calculated the descriptive statistics indicators, such as
spacing between the ordinal classes (e.g. responses 1 arithmetic mean, standard deviation, asymmetry and kur-

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Organizacija, Volume 50 Research Papers Number 2, May 2017

tosis. The calculation was based on the results of descrip- pal Component Analysis (PCA). Before performing PCA
tive statistics directly from the questionnaire responses, analysis, we further tested the answers of the respondents
using values of the Likert scale (1 to 6). with D`Agostino test. This test was chosen because of
The last, fifth hypothesis deviates due to an increased the structure of the responses: namely, the answers were
standard deviation. In this stage of the analysis, we reject- given in a Likert scale of 1 to 6. The test is particularly
ed hypothesis 5. All responses are within one standard suitable for determining the normality of the distribution
deviation. Also, the values of the standard error for all hy- of variables which contain multiple identical responses, in
potheses were quite the same, confirming the homogenity our case from 1 to 6. The test was checking whether the
of the average of the responses per the hypothesis. The answers received are distributed normally. The objective
hypotheses were tested according to the assumed normal of the PCA analysis was to identify whether there are other
distribution of average responses obtained. We used the - hidden factors of knowledge which had not been detected
non-parametric Shapiro-Wilk test. We found out that in in the literature studies and research. The results of our
most calculated averages of responses for each hypothesis, analysis (Table 10) were similar to the studied literature
and research by Valmohammadi (2010, 919).
a normal distribution can be assumed (statistical signifi-
Table 10 shows the synthesis of the main findings of
cance < 0.05).
the PCA analysis. According to the test results, it can be
concluded that the respondents are aware of knowledge
5.2 Factor analysis accumulated in the company and they agree with the the
statements that KM provides not only progress but also
We used the factor analysis to determine whether there the basic existence of the company. One of the objectives
are hidden components that can explain the greater part of of the study was to identify knowledge factors. The factor
the hypotheses’ variability. We used the method of Princi- analysis confirmed that the established new factors, e.g.

Table 8: Descriptive statistics of the hypotheses

* The arithmetic mean of all responses in relation to the hypothesis.

Test value arith. mean* = 3.5

Hypotheses Sig. Diff. arith. 95% Interval
t
(2 - tail) Mean Lower Upper
H 1 - Knowledge management creates innovation process-
5,237 ,000 ,44577 ,2759 ,6156
es.
H 2 - Knowledge management realizes the company’s
6,918 ,000 ,48839 ,3475 ,6293
strategies.
H 3 - Knowledge management creates conditions for the
5,262 ,000 ,46915 ,2912 ,6471
competitiveness of the organization.
H 4 - Knowledge management provides the foundations to
5,992 ,000 ,50940 ,3398 ,6790
new knowledge.
H 5 - Knowledge management helps to the success of the
5,806 ,000 ,47484 ,3116 ,6380
organization.

Table 9: Shapiro-Wilk normality test

Shapiro-Wilk normality
test
Statistic Sig.
H 1 - Knowledge management creates innovation processes. ,317 ,000
H 2 - Knowledge management realizes the company’s strategies. ,559 ,000
H 3 - Knowledge management creates conditions for the competitiveness of the orga-
,508 ,000
nization.
H 4 - Knowledge management provides the foundations to new knowledge. ,397 ,000
H 5 - Knowledge management helps to the success of the organization. ,346 ,000

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Organizacija, Volume 50 Research Papers Number 2, May 2017

Table 10: Summary of PCA analysis - Hypotheses 1 to 5

KMO Bartlett’s % rot. Cum.

Hypotheses Identified latent components Rotat.
test test comp. %
Technical approach to knowledge in the
1. 30,60%
company (storage, editing, sorting)
H 1 - Knowledge
The protection and transmission of Direct
management creates 0,752 0,001
accumulated knowledge (protection, Oblimin
innovation processes. 2. 11,15% 41,75%
intervention, learning, motivation in the
application of new knowledge)
The economic aspect of knowledge
management (KM investment assets,
1. 17,67%
measurement of KM yield, KM consis-
tency with company’s strategy)
H 2 - Knowledge Strength of intellectual capital (KM
management realizes development, updating of indicators
0,643 0,009 2. Varimax 16,71% 34,38%
the the company’s measuring KM and measuring the value
strategies. of intellectual capital)
Financial effects of KM per unit of time
3. (the time to perform the KM tasks and 13,15% 47,53%
effects on financial performance)
Motivation and teamwork (providing
resources for research, knowledge ad-
H 3 - Knowledge 1. 23,59%
ministrators, promoting teamwork, con-
management creates fidence in the exchange of knowledge)
conditions for the 0,729 Varimax
competitiveness of the Constructive approach in resolving
organization. errors (frank exchange of errors without
0,001 2. 23,32% 46,91%
fear of punishment, promoting ques-
tions, clearly defined responsibilities)
Use of information technology (pro-
1. vision of simplification and clarity of 21,98%
systems, use of technology systems)
Employment due to skills needs (prior-
H 4 - Knowledge
ity in employment of those who accept
management provides 2. 15,64% 37,62%
0,747 0,007 and pass on knowledge, new employ- Varimax
the foundations to new
ments to fill the gaps of knowledge)
knowledge.
The adequacy of the current KM sys-
tem (training of individuals to assume
3. 13,80% 51,42%
the roles associated with KM, training
for skills development)
Management support of KM (managers
are acting as an example, as catalysts
1. 31,90%
H 5 - Knowledge for KM, they recognize KM as an im-
management helps portant factor) Direct
0,738 0,002
to the success of the Comparative analysis (measurement Oblimin
organization. of the usefulness of KM initiatives in
2. 14,07% 45,97%
relation to the financial or non-financial
indicators of the company)

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Organizacija, Volume 50 Research Papers Number 2, May 2017

the area of human resources management, the importance When compared with the index ROA (which is an indi-
of warehousing and distribution of knowledge and organi- cator for assets), value added can indicate quite the oppo-
zational culture largely coincide with the reference survey site; the same also applies to the index ROI (profitability of
(Valmohammadi 2010, 915-924). In their study, authors investments). The value added is not correlated with finan-
Wong and Aspinwall (Wong & Aspinwall, 2005, 74-75) cial indicators and, as such, may well represent the “value”
confirmed the importance of positive motivation of em- of human capital in the company (Iazzolino & Lais, 2013,
ployees in the company. Our research confirmed this find- 561). Therefore, we chose the value added per employee
ing. We have learned that the motivation by superiors is a as a variable, because it is based on the knowledge of the
very important factor. We concluded that we can in aver- employees.
age explain 46.7% of the variabilities of all five hypotheses
with identified new latent components - factors.
6.1 The link between the company and
the respondent
6 Developing a model of knowledge
management factors For the construction of the statistical model of the factors
of knowledge, it was necessary to link the company and
The studied literature showed that there are several the responses to our survey. We used the data collected
methods of measuring human capital, but, as we noted, via questionnaires to identify the company to which a re-
there are many similarities between them. We searched spondent was affiliated.
for the theoretical foundations on which index to use for
measuring knowledge as a predictor - predictive variable 6.2 Designing the statistical model of
of value added per employee. Considering the required knowledge factors
amount of data collection, the most understandable and
therefore most affordable method of measuring intellectu- First, we identified three relatively homogeneous groups
al capital is the calculation based on the formula published (Table 11) based on published data (data was checked with
by Pulić (2004, 64), using the index VAIC. This method a web application Gvin) on value added per employee. We
is based on the difference between the market value and
used the method of two-step cluster analysis. For the dif-
the bookkeeping2 value of the company. The difference be-
ferentiation between the three newly formed groups, we
tween both categories is human capital. Intellectual capital
used a categorical variable: »Which industry (economic
or intellectual property of the organization (patents, stored
branch) the company deals with« and the continuous vari-
knowledge in the form of products, etc.) is understood as
able: »Value added per employee«.
a form of KM, therefore, it is necessary to increase the cu-
The model of knowledge factors in connection to the
mulation of human capital in companies with the purpose
value added is built out of two independent sections (ex-
of identifying market opportunities (Manuel, 2016, 62).
plained in the next chapter). Figure 1 shows the design of
The index VAIC (Value Added Intellectual Coefficient) can
the statistical model of knowledge factors.
be used for comparison among companies. The main idea
of VAIC coefficient is a measure of productivity “knowl-
edge” and not intellectual capital. The calculation is based 6.3 Multiple discriminant analysis
on the coefficient proposed by the author Pulić (2004, 64).
To understand the importance of intellectual capital, it is In the first section of the model, we analyzed where, on the
necessary to measure and compare it with other organiza- basis of questions presented in Table 11, the respondent
tions. The coefficient is composed of the following sum: – company belongs. This method, based on linear discrim-
VAIC = (Value added) / (Human capital) + (Value added) ination functions, is placing the respondent’s company in
/ (Financial capital) + (Value added) / (Structural capital). one of the three groups (Table 11), according to the value
Value added can be calculated by means of subtracting the added per employee. For discrimination, we used those
cost of materials and services from all of the company’s variables that largely contributed to clarify the variance
income (Pulić 2004, 65). Value added is, according to Pu- between the groups (Table 12).
lić, the real indicator, because it shows that organizations From the findings, we concluded that if the answers
create value and not the products. In this case, the value to those questions explain the largest proportion of the
added replaces the financial indicators such as ROI and variance of the latent components, then the listed variable
ROE. Value added can be a “measure” of company’s in- can discriminate between groups of companies in terms
tellectual capital. of value added per employee. In discriminant analysis, we
considered the fact that there is no multicolinearity be-
1

2 Under the term bookkeeping value we understand the sum of company’s funds and physical capital (buildings, land, etc.),
whereas the market value represents the product of the number and value of shares
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Table 11: Descriptive statistics of value added per employee formed in three groups

Arith. 95% Confidence interval of arith. mean change

Group N mean in Std. deviation Std. error
EUR Lower Upper
1 17 41.876,5 22.985,5 5.574,8 30.058,5 53.694,6
2 26 53.334,8 39.228,2 7.693,3 37.490,2 69.179,5
3 25 62.200,5 45.144,7 9.028,9 43.565,7 80.835,3
Total 68 53.729,7 38.638,0 4.685,5 44.377,3 63.082,1

Figure 1: The model of knowledge factors - three independent sections

tween the independent variables, the variances are homo- 3. Classification linear function for group 3 = Q35 *
geneous within the independent variables and that they are 6,966 + Q41 * 5,051 + Q42 * 2,943 + Q25 * 3,364
distributing “normally”. Using the classification function + Q48 * 1,736 + Q50 * 0,09 + Q9: * 2,814 + Q12 *
coeficients presented below (and in Table 11), we calcu- 2,851 + Q13 * 2,957 + Q15 * 5,551 + Q18 * 10,584
lated which group (from 1 to 3) the respondent (company) + Q53 * 6,841 + Q62 * 6,15 + Q3 * -0,918 -134,662
belongs to:
We substantiated the regularity of the new results with
1. Classification linear function for group 1 = Q35 * a table of cross-verifiability of classification into groups
4,193 + Q41 * 2,417 + Q42 * 1,719 + Q25 * 2,611 (Table 3). All replies received were re-tested with discrim-
+ Q48 * 1,011 + Q50 * 0,331 + Q9: * 1,425 + Q12 inant analysis. A total of 95.2% of cases were successful-
* 2,586 + Q13 * 2,696 + Q15 * 3,932 + Q18 * 6,192 ly classified according to the actual - a priori and planned
+ Q53 * 5,119 + Q62 * 2,42 + Q3 * -0,221 -56,938 clasification. Cross-checking of classification cathegory
also showed a high percentage of 85.7%. With linear clas-
2. Classification linear function for group 2 = Q35 * sification functions (discriminant analysis), we correctly
5,409 + Q41 * 3,743 + Q42 * 2,514 + Q25 * 3,321 predicted 95.2% of the existing cases according to their a
+ Q48 * 1,669 + Q50 * 0,356 + Q9: * 2,135 + Q12 priori values.
* 2,757 + Q13 * 3,301 + Q15 * 5,543 + Q18 * 8,521
+ Q53 * 4,998 + Q62 * 4,685 + Q3 * -0,019 -98,984

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Table 12: Discriminant analysis - the classification function coefficients; questions were rated on a scale from 1 to 6.

Groups
1 2 3
Q. 35: To what extent is efficient sorting and storing of knowledge important? 4,193 5,409 6,966
Q. 41: To what extent do you agree with the statement that it is important to protect
2,417 3,743 5,051
knowledge assets against unauthorized exposure or theft?
Q. 42: To what extent do you agree with the statement that your company has enough
1,719 2,514 2,943
proper motivators to encourage the production of new knowledge?
Q. 25: How often do you carry out the monitoring of the progress of KM development? 2,611 3,321 3,364
Q. 48: To what extent do you agree with the statement that your company has adequate
1,011 1,669 1,736
financial investment in the construction of the KM technological system?
Q. 50: To what extent do you agree with the statement that enough time to perform
,331 ,356 ,090
knowledge-related activities is provided for the employees?
Q. 9: To what extent does the following statement apply: There is a frank recognition of
1,425 2,135 2,814
mistakes without fear of punishment?
Q. 12: To what extent does the following statement apply: There is enough stimulation
2,586 2,757 2,851
and resources for the employees to explore new possibilities?
Q. 13: To what extent does he following statement apply: Inividuals are encouraged to
2,696 3,301 2,957
ask questions?
Q. 15: To what extent does the following statement apply: We use an appropriate KM
3,932 5,543 5,551
system?
Q. 18: To what extent does the following statement apply: Our company provides a
6,192 8,521 10,584
simple use of information technology?
Q. 53: To what extent do you agree with the statement that company provides adequate
5,119 4,998 6,841
training for taking the KM related roles?
Q. 62: To what extent does the following statement apply: The company has an estab-
lished system of internal mechanism with a view to coordination strategy, budget and 2,420 4,685 6,150
managing the human resources of the company?
Q. 3: To what extent does the following statement apply: The managers act as an exam-
-,221 -,019 -,918
ple to show the desired behavior?
Constant -56,938 -98,98 -134,66

Table 13: Discriminant analysis - Classification table groups and value added per employee
Estimated classification into groups
Groups Total
1 2 3
1 17 0 0 17
N 2 0 22 2 24
Actual classification 3 0 1 21 22
into groups 1 100,0 ,0 ,0 100,0
% 2 ,0 91,7 8,3 100,0
3 ,0 4,5 95,5 100,0
1 14 3 0 17
N 2 0 22 2 24
Cross-check of clas- 3 0 4 18 22
sifying groups 1 82,4 17,6 ,0 100,0
% 2 ,0 91,7 8,3 100,0
3 ,0 18,2 81,8 100,0

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Organizacija, Volume 50 Research Papers Number 2, May 2017

Automatic linear modeling by a grading system? - the possible answers are 1, 2, 3 and
4. According to the reply of the respondent, the regression
The second section includes the calculation of the estimat- coefficient which is set for a specific response is used for
ed value added per employee by using the linear regression the calculation value.
coefficients. We used an automatic linear modeling meth-
od (Yang, 2013). Typically, the variables with the ordinal Group 2 with regards to the value added
measurement scale are unsuitable for linear regression In the case of the linear regression model of Group 2, six
function, so we used a special method of linear modelling, independent variables, which are presented in Table 15,
namely the automatic linear modeling (part of the SPSS were selected. Below are the selected variables with the
statistical program package). For the dependent variable, corresponding coefficients: (Table 15)
we chose value added per employee, the independent vari- We eliminated two answers from the analysis, because
ables depend on the cathegory determined by multiple they were perceived as surplus values, which could distort
discriminant function. For each group of values added per the model. Further, we added a diagram and tables of co-
employee, we set variables which contribute the most to efficients. Additional explanations and descriptions of the
clarification and regression of value added per employee, results are not given because of a similar interpretation as
by means of automatic linear modeling. Independent vari- in the previous section, with the difference of changed cal-
ables data is drawn only from the corresponding group, culated values of coefficients.
this means that if the discriminant analysis selects Group
1, the regression coefficients are calculated only from in- Group 3 with regards to the value added
dependent variables (described below) which belong to In the case of the linear regression model of Group 3, six
Group 1. Below, we present a linear model for each group independent variables, which are presented in Table 16,
according to value added per employee. were selected: (Table 16)
To use the model for assessment of the value added
Group 1 with regards to the value added per employee, we need new answers (e.g. from a person
In the case of the linear regression model of Group 1, five who is a manager or deals with knowledge related tasks in
independent variables, which are presented in Table 14, the company). For the classification into one of the three
were selected. The selected variables for the linear regres- groups, the respondent must first answer the questions pre-
sion model of Group 1 are: (Table 14). sented in Table 12. Then, for the prediction of value added
The table of regression coefficients of Group 1 explic- per employee (it applies to the respondent’s company), we
itly and clearly shows the relative magnitude and direction place the new questions depending on the before ranked
of the coefficients. It was possible to answer each inde- group (e.g. if the company is classified in Group 1, then we
pendent variable (survey question) only with the predeter- place questions from Table 14). With automatic modeling,
mined values, e.g. To what extent (1 to 4) do you agree we calculate the new “possible answers”, namely 1 to 4 or
with the statement that the work performance is motivated 1 to 5. Previously, it was possible to submit the answers

Table 14: The table of regression coefficients of Group 1

Regression
Selected variables for linear regression - Group 1 Possible answers
coefficients
1 2.738,11
Q. 46: The work performance is motivated by a system of evaluation (1 to 4). 2 57.173,90
3,4 0
2,3,5 -7084,648
Q. 49: The company sufficiently provides resources to create new knowledge (1 to 5).
1,4 0
2 23844,307
Q. 51: The company provides sufficient education for KM (1 to 5).
1,3,4,5 0
1,3 -12468,932
Q. 58: We are rewarding for the purpose of retaining employees (1 to 4).
2,4 0
2,3 10823,943
Q. 7: There is a high organizational culture that values knowledge (1 to 4).
1,4 0
Intercept 40322,159

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Organizacija, Volume 50 Research Papers Number 2, May 2017

from 1 to 6 (multiply each answer with the corresponding other factors within the organization, and, secondary, how
regression coefficients and then sum it all together). much they contribute to the overall result of the company.
Knowledge can also be expressed in other ways, not only
as a “know-how” notion, but collective forms of knowl-
7 Discussion and conclusion edge, such as organizational culture and climate in the or-
ganization, can also be perceived. The empirical analysis
It is important for the company’s management to know, was made to determine in what way the respondents un-
primarily, which of the knowledge factors mostly affect derstand the stated hypotheses. We tested the hypotheses

Table 15: The table of regression coefficients of Group 2

Regression
Selected variables for linear regression Possible answers
coefficients
Q. 10: It is considered that the cooperation between employees is important (1 1 -21616,482
to 3). 2,3 0
3 -23677,136
Q. 25: We are regularly monitoring the progress of KM development (1 to 3).
1,2 0
Q. 31: The company has a clearly defined ownership of the initiatives arising 1 21259,937
from the KM group (1 to 3). 2,3 0
Q. 36: It is important to improve procedures for finding the necessary knowl- 3,4 -24194,388
edge (1 to 4). 1,2 0
Q. 53: The company provides adequate training for taking the KM related roles 4 34867,215
(1 to 4). 1,2,3 0
10 33965,614
Q. 66: What is the industry (economic branch) of your company?
1,2,3,7 0
Intercept 51994,262

Table 16: The table of regression coefficients of Group 3

Regression coeffi-
Selected variables for linear regression Possible answers
cients
3 -16391,569
Q. 14: The knowledge is accepted and shared among employees (1 to 4).
1,2,4 0
Q. 16: We use technological tools (tools for collaboration, knowledge base, 2 -33275,606
search engines, document management systems, intelligent systems, etc.) in
the company
1,3,4 0
(1 to 4).
4 29738,143
Q. 21: It is necessary to develop a KM strategy at any cost (1 to 4).
1,2,3 0
Q. 37: Knowledge exchange through usage of electronic media or personal 2 26742,352
contact is important (1 to 4). 1,3,4 0
Q. 52: Company provides sufficient education for the use of KM systems and 2,4 26414,401
tools (1 to 4). 1,3 0
10 51293,661
Q. 66: What is the industry (economic branch) of your company? 1,2,3,7 23347,973
6,8,9,11,12,14 0
Intercept 33716,551

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Organizacija, Volume 50 Research Papers Number 2, May 2017

and successfully verified four out of five. The last, fifth, re- On the other hand, training for performing tasks related
jected hypothesis – ‘Knowledge management helps to the to knowledge management and the use of technological
success of the organization’ did not meet the requirements tools (knowledge base, search engines, document manage-
for approval with the calculated criteria. This was due ment systems, intelligent systems, etc.) also have a posi-
mainly to dispersed answers and the fact that standard de- tive impact on the value added. The survey also showed
viation was unexpectedly large. Knowledge management that employees appreciate the positive organizational
can positively contribute to the success of the organization, culture; it was recognized as a factor of knowledge that
if well managed. Respondents were selected from different positively affects the value added, but to a lesser extent.
sized companies and from different industry branches, so The same applies to a clearly designed business strategy,
large deviations in answers are not surprising. cooperation between employees as well as the access and
Compared to the previous research by other authors sharing of knowledge within the company. Other factors of
(Akhavan, Hosnavi, & Sanjaghi, 2009), (Valmohammadi, knowledge identified in the literature were also recognized
2010), (Davenport & Prusak, 1998), (Brahma & Mishra, as influential in regard to the value added per employee.
2015) and (Bharadwaj, Chauhan, & Raman, 2015), our Among the activities in which the company operates are
findings are in certain parts confirming and in others devi- large differences in the average value added per employee.
ating. Deviations were detected in the area of motivation. The highest value added was observed in compa-
As a restriction of the research, we especially considered nies engaged in the telecommunications and media sec-
the definition of knowledge as a research matter. Knowl- tor, pharmaceutical companies and the energy sector. We
edge can also be expressed in other ways, e.g. in a col- also found that there is a positive correlation between the
lective form, such as organizational culture and climate in amount of value added and the answers that are associated
the organization. Although knowledge contributes an im- with motivation and rewarding of the employees. Reward-
portant part in realizing the company’s performance, there ing and employee‘s motivation are reflected in increased
are also other elements, which we did not cover in this value added. Positive correlation was also found between
research, and also have a strong impact on the company value added per employee and the opinion that it is nec-
result, e.g. economic development of the area in which the essary to develop strategies related to KM. The factor
company operates, the role of government, market disci- that defines the coordination of human resources was also
pline, etc. placed high on the scale of importance. On the other hand,
As a guideline for future research, we suggest period- we discovered that inciting for comparing with other simi-
ic repetitions of the research and inclusion of coefficients lar organizations has a negative impact on the value added.
that reflect the economic and market situation in the ob- The common characteristic of companies with high value
servation period (e.g. economic growth, employment rate, added per employee is shown in the fact that the majority
interest rates - the price of money, etc.). By comparing the of all the received replies concerning motivation, reward-
results of the periodic analysis, we can measure the devi- ing, training and education of employees were rated as
ations of value-added companies in conjunction with the very important.
factors of knowledge, as well as the impact of the econom- We have detected the lowest value added per employee
ic situation on the generation of new knowledge, etc. in companies engaged in the construction, chemical and
tourism sector. For these companies, the opposite applies
8 The practical value of the study as for companies with high value added. The biggest dis-
advantage which we detected in these companies is weak
We see the applicable value of the study in the identifica- organizational culture, insufficient investment in educa-
tion of the most important factors of knowledge with the tion of the employees and inadequate update of the IT
connection to the company’s success measured in euros infrastructure. What is more, the statement »Leaders do
per employee. Primarily, we found out that industry branch not give proper respect to employees« was described as
in which the company operates strongly impacts the value “agree”. We concluded that this is the result of the poor
added per employee. In addition, we confirmed that the management of the companies and not of the employees‘
motivation by assessing work performance is in a strong work.
positive correlation with the value added per employee. The applicability of the study can also be seen in the
This means that a fair assessment (evaluation only, with no construction of a statistical model, with which the value
money reward, etc.) of the employee by the employer has added can be “assessed”. We built a model of the factors
a major impact on the value added. Besides the industry of knowledge which allows us to estimate the value added
branch in which the company is engaged, it turned out that per employee. The assessment of value added is based on
commendation for a job well done in the long-term affects business results from 2010 and therefore has no real pre-
the company’s success. What follows is a factor that is dictive power, so if we form the model today, the result
positively associated with value added, namely the ongo- – estimation of value added per employee would not be
ing monitoring and evaluation of the company’s progress. entirely the same. To start up the model, we need to as-

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Organizacija, Volume 50 Research Papers Number 2, May 2017

semble new answers to the questions (among others, there 1185, http://dx.doi.org/10.1108/00251740510626254
would also be issues which are not directly linked to the Brahma, S., & Mishra, S. (2015). Understanding Re-
knowledge as such, e.g. the year the company was found- searchable Issues in Knowledge Management: A Lit-
ed in, the ownership structure, whether the company is in erature Review. Journal of Knowledge Management,
bankruptcy or expects bankruptcy, etc.) from the person 13(4), 43.
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with the internal structure and operation of the company. vladovanje organizacijskih sprememb [Management
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responses received, we would place the company into one Bukovec, B. (2009). Human Resources Management
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Domen Kozjek is Master Degree graduate at the Uni- ulty of Theology at University of Ljubljana and Faculty
versity of Primorska, Slovenia in the field of Tourism. He of Health Sciences at University of Maribor. She has
is finishing PhD degree at the Faculty of Organisation published eleven books and several articles in journals
Studies Novo mesto. He is the author of several scien- indexed in SSCI, Scopus, CSA, and she has mentored
tific articles. He works in a large retail company. 37 Doctoral theses, over 90 Master theses and several
hundred diploma assignments. She has participated in
the preparation of several higher education curricula,
Marija Ovsenik received her Master degree in Organ- 11 of which have received accreditation. She managed
isational Sciences from University of Maribor in 1985, a Leonardo da Vinci Project and participated in interna-
and her Doctorate in Social Policy and Social Manage- tional projects with the University of Goetheborg. She
ment from University of Sarajevo in 1990. In 2002, she has given invited talks at the University of Goetheborg,
became Full Professor at the University of Ljubljana, Case Western Reserve in Cleveland, USA, Lyn Univer-
Faculty of Social Work. She managed the TEMPUS sity in Boca Raton, USA, and St. Thomas University in
project, which resulted in the educational programme Miami, USA. In 2013, she obtained her second Doc-
Management in Social Work at the undergraduate and torate in Quality management from the Faculty of Or-
graduate levels. She has also taught at the University ganisational Studies in Novo mesto. In 1996, she was
of Maribor and at the University of Primorska, where awarded the prize for outstanding achievements in so-
she was Dean of the Faculty of Tourism for four years. cial protection given by the Ministry of Labour, Family
She has designed the Social Gerontology curriculum and Social Affairs. In 2016, she recieved the »Acknowl-
and implemented it at Alma Mater Europaea, Europe- edgement of Excelence« for her achievements in the
an Centre Maribor, where she currently is head of the area of education, and was given the title »Ambasador
Social Gerontology Department. She also teaches at of Knowledge«.
the Faculty of Organisation Studies in Novo mesto, Fac-

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