Examining the Conceptual Models on Knowledge Management in Indonesian Organizations: A Survey of the Banking and Insurance Companies in Central Java

Abstract

The knowledge management is a major strategic imperative that supports financial organizations in a competitive environment. The importance of knowledge management is reflected in the fact that most of the managers saw their organizations as knowledge-based organizations that recognized the importance of knowledge, knowledge acquisition, knowledge dissemination and responsiveness to knowledge. Although various processes have been linked to knowledge management, it is clear that financial organizations realize that these processes must be supported by organizational culture and ICT usage. The objectives of this study are to examine the conceptual models of knowledge management, to examine the causal relationship between internal organizational variables and knowledge management, and to determine the causal relationship between knowledge management and competitive intensity. This study surveyed the financial industrial environment by choosing the banking and insurance companies in three major cities in Central Java and Jogjakarta Special Province as the research population (total sample, N=201). The research subjects were the branch managers of the banking and insurance companies who were considered to have a sound understanding of knowledge management in their respective companies. This result indicated that the null hypothesis (model hypothesis) stating that there is no significant difference between the model and the acceptable empirical data was confirmed. This study demonstrated that the knowledge management activities were part of a system that had some linkage with other variables and functions as strengthener for the achievement of competitiveness through competitive intensity.