CHAPTER V CONCLUSION
5.1 Summary of findings
5.1.2 The effects of KCP upon banking performance
Knowledge creation processpositively affected to the banking performance but not all SECI process had the significant effect toward each perspective of organizational performance. Surprisingly, SECI process was found to be the unimportant factor for customer performance, revealing that the activities of knowledge creation in Thai banks cannot reflect to customer satisfaction, strategy to acquire new customers, and maintaining good relationship with customers. This can be implied that the spiral movement of SECI process in Thai banks could not reach beyond the boundary of organization.
Socialization was the main process in Thai banking industry as it positively affected to every perspective of organizational performance (except customer perspective) with the highest magnitude comparing to the other SECI processes. This reveals that employees in Thai banks focused more on tacit knowledge sharing to perform their jobs which resulted to the outcome of organizational performance.
Socialization not only affect to the business performance but also impact to the working
atmosphere such as trust, openness and good relationships among employees. The result aligns with the research from Kulangara, Jackson, and Prater (2016) that formal socialization increases trust in business environment. The large effect of socialization in Thai banks could be from collectivist society in Thailand which impelled these social activities. Moreover, banking industry is a service industry. Thus, it required a lot of social interactions in the working process when compared with other industries such as manufacturing industry.
Externalization positively affected to 4 perspectives in organizational performance; business process, intellectual capital, employee, and social perspectives.
However, externalization was not affect to financial performance. This could be from the nature of banking industry which is required to comply with the regulations and acts.
Banking employees needed to consider organizational norms and expectations along with regulations and acts before expressing their tacit knowledge. It led to fear of making mistakes issue and hindered externalization process. Activities of externalization create new explicit knowledge for organization which can be shared to other members in organization. It helps reduce time and cost as other members can learn from that explicit knowledge. In this sense, fear of making mistakes limited externalization and minimized its benefits within Thai banks in financial aspect. This could be the explanation why externalization was found to be an unimportant factor in financial performance.
The activities of collect and rearrange existing explicit knowledge into more usable forms positively affected to financial, business process, intellectual capital, and social performance. Having said that, the effect size of combination towards intellectual capital and social performance were in minor degrees. This could related to the concerned point that updating organizational database received the lowest agreement among combination activities. Outdated database hindered the combination processes as employees felt unconfident to use data which resulted in less new explicit knowledge and therefore, lowered the intellectual capital in Thai banks. Moreover, the small extent of combination toward social performance could be from the perception of activities in social perspective as Thai organizations perceived social activities such as CSR activities as non-related working activities. As a result, combination processes which
focused more on creating new explicit knowledge for working purpose had relatively low effect to social performance. Additionally, combination was identified to be a non- essential factor for employee performance. This could be from the individual perception in employee perspective such as working atmosphere, pay and benefit satisfaction which cannot be fulfilled by the combination activities.
Furthermore, internalization processes positively affected financial, business process, intellectual, and employee performance. Comparing the effect size with other SECI processes, internalization had the highest effect size on business process and intellectual capital perspectives. This marks the importance of converting explicit into tacit knowledge which drives business activities and increases knowledge assets in Thai banks. The important role of internalization aligns with the research of Hubers, Poortman, Schildkamp, Pieters, and Handelzalts (2016). Their findings indicate that the more engagement in socialization and internalization, the deeper knowledge that employees gain in educational context. In the opposite way, internalization was not affect to organizational performance in social perspective. This could be explained by the perception of non-related working activities in social perspective which limited the internalization processes within Thai banks. With the above findings according to the relationship between knowledge creation process and organizational performance, the key points were summarized into Figure 5.1 for clearly understanding.
Collectivism Service industry Socialization
Effect toward perceptions - Financial perspection - Business Process perspective - Intellectual perspective - Employee perspective - Social perspective
Limited
- Customer perspective (External party outside organization)
Externalization
Effect toward perceptions - Business Process perspective - Intellectual perspective - Employee perspective - Social perspective
Limited
- Financial perspective (Fear of making mistakes)
- Customer perspective (External party outside organization)
Internalization
Effect toward perceptions - Financial perspection - Business Process perspective - Intellectual perspective - Employee perspective
Limited
- Customer perspective (External party outside organization)
- Social perspective (Non-related working activities)
Combination
Effect toward perceptions - Financial perspection - Business Process perspective - Intellectual perspective - Social perspective
Limited
- Customer perspective (External party outside organization)
- Employee perspective (Cannot fulfill individual satisfaction)
Figure 5.1 SECI model toward perception of organizational performance in Thai banking industry