The linkage between individual value and knowledge creation in human capital
Abstract
This study aims to examine the relationship between individual value and knowledge creation in human capital.The effect of individual value on each element of knowledge creation – socialization, externalization, combination and internalization – is tested in this study. The study also tested the effect of each component of knowledge creation with human capital. Data were collected using an online questionnaire. A total of 286 questionnaires were sent to managers of medium-sized companies in the province of Bali, Indonesia. Of the 196 questionnaires that were sent, returned and filled out completely, 158 had responses that were utilizable, showing a usable response rate of 80.61%. Data analysis was carried out using variance-based structural equation modelling with a partial least squares approach (SEM-PLS) with WarpsPLS 7.0. The results of the study found a significant positive effect of individual value on each element of knowledge creation: with socialization, with externalization, with combination and with internalization. This study also found that each component of knowledge creation has a significant positive effect on human capital: socialization, externalization, combination and internalization, respectively. This study shows that the value that is believed by individuals based on knowledge can be a strong factor of competitiveness for future of human capital.
Keyword : individual value, knowledge creation, socialization, externalization, combination, internalization, human capital
How to Cite
Kusumawijaya, I. K., & Astuti, P. D. (2023). The linkage between individual value and knowledge creation in human capital. Business: Theory and Practice, 24(1), 70–81. https://doi.org/10.3846/btp.2023.15726
This work is licensed under a Creative Commons Attribution 4.0 International License.
References
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Huang, Y. C., & Wu, Y. C. J. (2010). Intellectual capital and knowledge productivity: The Taiwan biotech industry. Management Decision, 48(4), 580–599. https://doi.org/10.1108/00251741011041364
Khadan, J. (2018). Estimating the effects of human capital constraints on innovation in the Caribbean. Economies, 6(2), 33. https://doi.org/10.3390/economies6020033
Kock, N. (2020). WarpPLS User Manual Version 7.0. ScriptWarp Systems, 141.
Lado-González, E. M., & Dopico, D. C. (2017). The importance of intangible assets in the strategic management of the firm: An empirical application for banco Santander. European Research Studies Journal, 20(2), 177–196. https://doi.org/10.35808/ersj/636
Lepak, D. P., & Snell, S. A. (2002). Examining the human resource architecture: The relationships among human capital, employment, and human resource configurations. Journal of Management, 28(4), 517–543. https://doi.org/10.1177/014920630202800403
Madhani, P. M. (2012). Intangible assets: Value drivers for competitive advantages. Best Practices in Management Accounting, April 2012, 147–164. https://doi.org/10.1057/9780230361553
Malhotra, Y. (2000). Knowledge assets in the global economy: Assessment of National Intellectual Capital. Journal of Global Information Management, 8(3), 5–15. https://doi.org/10.4018/jgim.2000070101
Marr, B., Schiuma, G., & Neely, A. (2004). Intellectual capital – defining key performance indicators for organizational knowledge assets. Business Process Management Journal, 10(5), 551–569. https://doi.org/10.1108/14637150410559225
Meglino, B. M., & Ravlin, E. C. (1998). Individual values in organizations: Concepts, controversies, and research. Journal of Management, 24(3), 351–389. https://doi.org/10.1177/014920639802400304
Memon, S. B., Syed, S., & Arain, G. A. (2017). Employee involvement and the knowledge creation process: An empirical study of Pakistani banks. Global Business and Organizational Excellence, 36(3), 53–63. https://doi.org/10.1002/joe.21780
Mitra, J., Abubakar, Y. A., & Sagagi, M. (2011). Knowledge creation and human capital for development: The role of graduate entrepreneurship. Education and Training, 53(5), 462–479. https://doi.org/10.1108/00400911111147758
Musil, B., Rus, V. S., & Musek, J. (2009). The Rokeach value survey in comparative study of Japanese and Slovenian students: Towards the underlying structure. Studia Psychologica, 51(1), 53–68.
Mutamba, C. (2016). An exploration and critique of the use of human capital theory in human resource development research. In AHRD Conference in the Americas, February (pp. 1–18). RELT.
Newman, B. D., & Conrad, K. W. (2000, 30–31 October). A framework for characterizing knowledge management methods, practices, and technologies. In Proceedings of the Third International Conference on Practical Aspects of Knowledge Management (PAKM2000). Basel, Switzerland.
Nonaka, I., & Nishiguchi, T. (2002). Knowledge emergence: Social, technical, and evolutionary dimensions of knowledge creation. Journal of Economic Issues, 36(3), 819–821. https://doi.org/10.1080/00213624.2002.11506518
Nonaka, I., & Takeuchi, H. (1994). The knowledge-creating company: How Japanese companies create the dynamics of innovation. Journal of International Business Studies, 27, 196–201. https://doi.org/10.1057/jibs.1996.13
Nonaka, I., Toyama, R., & Konno, N. (2000). SECI, Ba and leadership: A unified model of dynamic knowledge creation. Long Range Planning, 33(1), 5–34. https://doi.org/10.1016/S0024-6301(99)00115-6
Pojasek, R. B., Garn, J., & Papadopoulos, N. (2001). Knowledge management and visual context. Environmental Quality Management, 11(1), 77–87. https://doi.org/10.1002/tqem.1207
Rastogi, P. N. (2000). Knowledge management and intellectual capital – The new virtuous reality of competitiveness. Human Systems Management, 19(1), 39–48. https://doi.org/10.3233/HSM-2000-19105
Rokeach, M. (1968). A theory of organization and change within value‐attitude systems. Journal of Social Issues, 24(1), 13–33. https://doi.org/10.1111/j.1540-4560.1968.tb01466.x
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Scharmer, C. O. (2001). Self-transcending knowledge: Sensing and organizing around emerging opportunities. Journal of Knowledge Management, 5(2). https://doi.org/10.1108/13673270110393185
Schwartz, S. H. (2011). Value orientations: Measurement, antecedents and consequences across nations. In Measuring attitudes cross-nationally (pp. 169–203). Sage. https://doi.org/10.4135/9781849209458.n9
Seleim, A., & Khalil, O. (2007). Knowledge management and organizational performance in the Egyptian software firms. International Journal of Knowledge Management (IJKM), 3(4), 37–66. https://doi.org/10.4018/ijkm.2007100103
Shih, K. H., Chang, C. J., & Lin, B. (2010). Assessing knowledge creation and intellectual capital in banking industry. Journal of Intellectual Capital, 11(1), 74–89. https://doi.org/10.1108/14691931011013343
Society for Human Resource Management. (2015). Business and human capital challenges today and in the future. Society for Human Resource Management.
Spender, J.-C. (1999). Chapter 7 – Organizational knowledge, collective practice and Penrose rents. In Knowledge and strategy (pp. 117–132). Elsevier. https://doi.org/10.1016/B978-0-7506-7088-3.50010-3
Spender, J. C., & Grant, R. M. (1996). Knowledge and the firm: Overview. Strategic Management Journal, 17(S2), 5–9. https://doi.org/10.1002/smj.4250171103
Teece, D. J., Pisano, G., & Shuen, A. (1997). Dynamic capabilities and strategic management. Strategic Management Journal, 18(7), 509–533. https://doi.org/10.1002/(SICI)1097-0266(199708)18:7<509::AID-SMJ882>3.0.CO;2-Z
Tiwana, A. (1999). The knowledge management toolkit. Prentice Hall.
Yu, C., Zhang, Z., Lin, C., & Wu, Y. J. (2017). Knowledge creation process and sustainable competitive advantage: The role of technological innovation capabilities. Sustainability, 9(12). https://doi.org/10.3390/su9122280
Zhou, A. Z., & Fink, D. (2003). Knowledge management and intellectual capital: An empirical examination of current practice in Australia. Knowledge Management Research & Practice, 1(2), 86–94. https://doi.org/10.1057/palgrave.kmrp.8500009
Barney, J. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99–120. https://doi.org/10.1177/014920639101700108
Bontis, N. (1999). Managing organizational knowledge by diagnosing intellectual capital: Framing and advancing the state of the field. International Journal of Technology Management, 18(5), 433–462. https://doi.org/10.1504/IJTM.1999.002780
Bontis, N., William Chua Chong, K., & Richardson, S. (2000). Intellectual capital and business performance in Malaysian industries. Journal of Intellectual Capital, 1(1), 85–100. https://doi.org/10.1108/14691930010324188
Central Bureau of Statistics. (2021). Bali Province in figure 2021. Bali, 576.
Chaudhry, N. I., Bilal, A., Awan, M. U., Bashir, A., Campus, G., & Campus, Q. (2016). The role of environmental consciousness, Green Intellectual capital management and competitive advantage on financial performance of the firms: An evidence from manufacturing sector of Pakistan. Journal of Quality and Technology Management, XII(Ii), 51–70.
Chen, C. J., & Huang, J. W. (2009). Strategic human resource practices and innovation performance – The mediating role of knowledge management capacity. Journal of Business Research, 62(1), 104–114. https://doi.org/10.1016/j.jbusres.2007.11.016
Chin, W. W. (1998). Commentary: Issues and opinion on structural equation modeling. MIS Quarterly: Management Information Systems, 22(1), vii–xvi.
Chou, S. W., & Tsai, Y. H. (2004). Knowledge creation: Individual and organizational perspectives. Journal of Information Science, 30(3), 205–218. https://doi.org/10.1177/0165551504042803
Curado, C. (2008). Perceptions of knowledge management and intellectual capital in the banking industry. Journal of Knowledge Management, 12(3), 141–155. https://doi.org/10.1108/13673270810875921
Davenport, T. H., & Prusak, L. (1998). Working knowledge: How organizations manage what they know. Harvard Business School Press.
Debowski, S. (2006). Knowledge management. John Wiley & Sons.
Delshab, V., Winand, M., Sadeghi Boroujerdi, S., Pyun, D. Y., & Mahmoudian, A. (2019). Analyzing the influence of employee values on knowledge management in sport organizations. Journal of Science and Technology Policy Management, 10(3), 667–685. https://doi.org/10.1108/JSTPM-04-2018-0039
Fornell, C., & Larcker, D. F. (1981). Evaluating structural equation models with unobservable variables and measurement error. Journal of Marketing Research, 18(1), 39–50. https://doi.org/10.1177/002224378101800104
Freiling, J. (2004). A competence-based theory of the firm. Management Review, 15(1), 27–52. https://doi.org/10.5771/0935-9915-2004-1-27
Gorman, G. E., & Pauleen, D. J. (2011). The nature and value of personal knowledge management. Personal Knowledge Management: Individual, Organizational and Social Perspectives, 2(January 2011), 9–30.
Grant, R. M. (1991). The resource-based theory of competitive advantage: Implications for strategy formulation. California Management Review, 33(3), 114–135. https://doi.org/10.2307/41166664
Grube, J. W., Mayton, D. M., & Ball‐Rokeach, S. J. (1994). Inducing change in values, attitudes, and behaviors: Belief system theory and the method of value self‐confrontation. Journal of Social Issues, 50(4), 153–173. https://doi.org/10.1111/j.1540-4560.1994.tb01202.x
Hair, J. F. J., Hult, G. T. M., Ringle, C. M., & Sarstedt, M. (2017). A primer on partial least squares structural equation modeling (PLS-SEM). Sage Publication.
Henseler, J., Ringle, C. M., & Sinkovics, R. R. (2009). The use of partial least squares path modeling in international marketing. Advances in International Marketing, 20(January), 277–319. https://doi.org/10.1108/S1474-7979(2009)0000020014
Hitt, M. A., Bierman, L., Shimizu, K., & Kochhar, R. (2001). Direct and moderating effects of human capital on strategy and performance in professional service firms: A resource-based perspective. Academy of Management Journal, 44(1), 13–28. https://doi.org/10.5465/3069334
Horwitch, M., & Armacost, R. (2002). Helping knowledge management be all it can be. Journal of Business Strategy, 23(3), 26–31. https://doi.org/10.1108/eb040247
Huang, Y. C., & Wu, Y. C. J. (2010). Intellectual capital and knowledge productivity: The Taiwan biotech industry. Management Decision, 48(4), 580–599. https://doi.org/10.1108/00251741011041364
Khadan, J. (2018). Estimating the effects of human capital constraints on innovation in the Caribbean. Economies, 6(2), 33. https://doi.org/10.3390/economies6020033
Kock, N. (2020). WarpPLS User Manual Version 7.0. ScriptWarp Systems, 141.
Lado-González, E. M., & Dopico, D. C. (2017). The importance of intangible assets in the strategic management of the firm: An empirical application for banco Santander. European Research Studies Journal, 20(2), 177–196. https://doi.org/10.35808/ersj/636
Lepak, D. P., & Snell, S. A. (2002). Examining the human resource architecture: The relationships among human capital, employment, and human resource configurations. Journal of Management, 28(4), 517–543. https://doi.org/10.1177/014920630202800403
Madhani, P. M. (2012). Intangible assets: Value drivers for competitive advantages. Best Practices in Management Accounting, April 2012, 147–164. https://doi.org/10.1057/9780230361553
Malhotra, Y. (2000). Knowledge assets in the global economy: Assessment of National Intellectual Capital. Journal of Global Information Management, 8(3), 5–15. https://doi.org/10.4018/jgim.2000070101
Marr, B., Schiuma, G., & Neely, A. (2004). Intellectual capital – defining key performance indicators for organizational knowledge assets. Business Process Management Journal, 10(5), 551–569. https://doi.org/10.1108/14637150410559225
Meglino, B. M., & Ravlin, E. C. (1998). Individual values in organizations: Concepts, controversies, and research. Journal of Management, 24(3), 351–389. https://doi.org/10.1177/014920639802400304
Memon, S. B., Syed, S., & Arain, G. A. (2017). Employee involvement and the knowledge creation process: An empirical study of Pakistani banks. Global Business and Organizational Excellence, 36(3), 53–63. https://doi.org/10.1002/joe.21780
Mitra, J., Abubakar, Y. A., & Sagagi, M. (2011). Knowledge creation and human capital for development: The role of graduate entrepreneurship. Education and Training, 53(5), 462–479. https://doi.org/10.1108/00400911111147758
Musil, B., Rus, V. S., & Musek, J. (2009). The Rokeach value survey in comparative study of Japanese and Slovenian students: Towards the underlying structure. Studia Psychologica, 51(1), 53–68.
Mutamba, C. (2016). An exploration and critique of the use of human capital theory in human resource development research. In AHRD Conference in the Americas, February (pp. 1–18). RELT.
Newman, B. D., & Conrad, K. W. (2000, 30–31 October). A framework for characterizing knowledge management methods, practices, and technologies. In Proceedings of the Third International Conference on Practical Aspects of Knowledge Management (PAKM2000). Basel, Switzerland.
Nonaka, I., & Nishiguchi, T. (2002). Knowledge emergence: Social, technical, and evolutionary dimensions of knowledge creation. Journal of Economic Issues, 36(3), 819–821. https://doi.org/10.1080/00213624.2002.11506518
Nonaka, I., & Takeuchi, H. (1994). The knowledge-creating company: How Japanese companies create the dynamics of innovation. Journal of International Business Studies, 27, 196–201. https://doi.org/10.1057/jibs.1996.13
Nonaka, I., Toyama, R., & Konno, N. (2000). SECI, Ba and leadership: A unified model of dynamic knowledge creation. Long Range Planning, 33(1), 5–34. https://doi.org/10.1016/S0024-6301(99)00115-6
Pojasek, R. B., Garn, J., & Papadopoulos, N. (2001). Knowledge management and visual context. Environmental Quality Management, 11(1), 77–87. https://doi.org/10.1002/tqem.1207
Rastogi, P. N. (2000). Knowledge management and intellectual capital – The new virtuous reality of competitiveness. Human Systems Management, 19(1), 39–48. https://doi.org/10.3233/HSM-2000-19105
Rokeach, M. (1968). A theory of organization and change within value‐attitude systems. Journal of Social Issues, 24(1), 13–33. https://doi.org/10.1111/j.1540-4560.1968.tb01466.x
Salzer-Morling, M., & Yakhlef, A. (1999, 22–24 April). The intellectual capital: Managing by measure. In The Critical Perspective on Accounting Conference. University of New York. http://www.exinfm.com/pdffiles/morling.pdf
Scharmer, C. O. (2001). Self-transcending knowledge: Sensing and organizing around emerging opportunities. Journal of Knowledge Management, 5(2). https://doi.org/10.1108/13673270110393185
Schwartz, S. H. (2011). Value orientations: Measurement, antecedents and consequences across nations. In Measuring attitudes cross-nationally (pp. 169–203). Sage. https://doi.org/10.4135/9781849209458.n9
Seleim, A., & Khalil, O. (2007). Knowledge management and organizational performance in the Egyptian software firms. International Journal of Knowledge Management (IJKM), 3(4), 37–66. https://doi.org/10.4018/ijkm.2007100103
Shih, K. H., Chang, C. J., & Lin, B. (2010). Assessing knowledge creation and intellectual capital in banking industry. Journal of Intellectual Capital, 11(1), 74–89. https://doi.org/10.1108/14691931011013343
Society for Human Resource Management. (2015). Business and human capital challenges today and in the future. Society for Human Resource Management.
Spender, J.-C. (1999). Chapter 7 – Organizational knowledge, collective practice and Penrose rents. In Knowledge and strategy (pp. 117–132). Elsevier. https://doi.org/10.1016/B978-0-7506-7088-3.50010-3
Spender, J. C., & Grant, R. M. (1996). Knowledge and the firm: Overview. Strategic Management Journal, 17(S2), 5–9. https://doi.org/10.1002/smj.4250171103
Teece, D. J., Pisano, G., & Shuen, A. (1997). Dynamic capabilities and strategic management. Strategic Management Journal, 18(7), 509–533. https://doi.org/10.1002/(SICI)1097-0266(199708)18:7<509::AID-SMJ882>3.0.CO;2-Z
Tiwana, A. (1999). The knowledge management toolkit. Prentice Hall.
Yu, C., Zhang, Z., Lin, C., & Wu, Y. J. (2017). Knowledge creation process and sustainable competitive advantage: The role of technological innovation capabilities. Sustainability, 9(12). https://doi.org/10.3390/su9122280
Zhou, A. Z., & Fink, D. (2003). Knowledge management and intellectual capital: An empirical examination of current practice in Australia. Knowledge Management Research & Practice, 1(2), 86–94. https://doi.org/10.1057/palgrave.kmrp.8500009