Tacit Knowledge, Social Networks, Organizational Learning and Competitive Advantage of Information and Communication Technology Content Service Providers in Nairobi

Abstract

The concept of tacit knowledge has attracted significant contributions in scholarship as a core element of organizational knowledge creation, a cornerstone of the concept of organizational learning, and an important driving force of unified managerial action, which serves as a catalyst for organizational competiveness. Some scholars have also argued that social networks serve as a mediation mechanism that facilitates the manifestation of tacit knowledge into a competitive advantage. However, there appears to be few studies that have explicitly tested these theories empirically in the Kenyan context. Many of the previous studies were done in USA, a country whose business landscape has been shaped by many years of economic, political and social cultural evolution. Testing these theories in the local Kenyan ICT sector context was therefore a worthwhile and interesting academic endeavor, particularly in light of the vibrancy of this sector in Kenya today. One key question guided the current study. How does tacit knowledge interplay with social networks and organizational learning to enhance the competiveness of ICT content service providers in Nairobi? The study followed a post-positivist critical realism philosophical orientation, using a cross-sectional survey design approach. Accordingly, a self-administered survey elicited data from study participants. The population for the study was the ICT content service providers licensed by the Communications Authority of Kenya (CAK), a fertile ground for ICT knowledge creation and dissemination. Out of the target population of 197 ICT content service providers licensed by the CAK, 135 firms provided valid responses to the survey. The current study used linear regression and structural equation modeling techniques, which are powerful in the analysis of latent constructs. The study highlighted tacit knowledge as a key driver of competitive advantage. Further, the study showed that organizational learning mediated the effect of tacit knowledge on competitive advantage. The research data did not support the hypothesis that social networks mediate the influence of tacit knowledge on competitive advantage. However, alternative tests using a slightly modified conceptual framework showed that social networks actually mediated the relationship between tacit knowledge and organizational learning. Another key finding of the study was that tacit knowledge and organizational learning had a joint effect on competitive advantage. The study was an additional building block in the Resource-Based and Knowledge-Based Views of strategic management. It is anticipated that the study will enable policy makers to gain fresh insights on the strategic importance of harnessing tacit knowledge possessed by their employees and nurturing an organizational learning culture as ways of improving the competiveness of their organizations. Additionally, the study should encourage strategic management practitioners to proactively identify areas of the business that are dependent on tacit knowledge and assign duties and responsibilities to employees accordingly, in order to ensure sustainable tacit knowledge-driven competitive advantage. The study is limited by the relatively small size of the research domain, and operationalization of latent constructs using multiple indicators some of which are still the subject of debate in academic circles. It is recommended that future studies should take into account the disruption that is currently being driven by technological changes that challenge the underlying assumptions of the Knowledge-Based and Resource-Based Views. Also, future research should consider the use of electronic questionnaires, and explore more robust ways of operationalizing the tacit knowledge construct.