Investigation of the Relationship between the Knowledge Management Process and Performance of a Construction Company: An Empirical Study

Abstract

Aim/Purpose: This study aims to investigate the relationship between the knowledge management (KM) process and the performance of construction companies. The ultimate goal is to promote better efficiency and competitive advantage in the construction industry by making the best use of knowledge. Background: While attention to KM is currently on the rise, as shown by the number of studies conducted, research on KM in the construction industry of Indonesia is still very rare. However, organizational learning as the implementation of KM provides an opportunity to improve the construction industry, and thus there is an urgency to conduct research on this topic. Methodology: This study lasted for three months and used the survey method, with 100 questionnaires distributed to contractors of grade 6 and 7 on the islands of Java and Borneo in Indonesia. A total of 54 returned questionnaires were deemed complete and eligible for further analysis. Data analysis was performed using the structural equation modeling method with partial least squares (SEM PLS). Contribution: This study helps to measure the relationship value of the KM process and company performance. Findings: The results of this study indicate that the process of KM has a significant and positive influence on company performance, and there is a positive interaction in the process of KM and company performance as well. Recommendations for Practitioners: Construction companies need to perceive that activities undertaken in a construction project should always be assumed to be a KM process in order to make strategic and effective decisions that can result in improvements to customers, finance, internal business, learning, and growth. Recommendation for Researchers: Research on the KM process and information technology needs to be developed more, so that construction companies can apply this knowledge to explore problems and create solutions, resulting in methods to facilitate efficiency and effectiveness. Impact on Society: This paper helps to understand that KM activities provide initial benefits and guidance for companies that want to apply KM. Future Research: Innovative and new ideas to cultivate the KM process in the construction industry need to be explored and developed to improve the implementation.