Knowledge Management Practices And Performance Of Micro-Finance Institutions In Kenya: A Case Of Uwezo Micro-Finance Bank

ABSTRACT

Knowledge Management is how firms acquire, apply and store their intellectual capital. It is the information obtained and structured to influence the skills and experience of all the organizational employees efficiently and effectively in order to maintain the processing needs of information together with supporting and allowing decision making process on knowledge staff. Over the years Knowledge management has gained much prominence, and more attention has been focused on it to improve Organizational performance. Despite this, lack of information has been transformed to the availability of information and the serious pressures from the global perspective regarding management include identification, creation, dissemination and protection of knowledge. Moreover, how knowledge Management affects organizational performance is a question that has not been adequately addressed. The purpose of this study was, therefore, to assess the effect of knowledge management on the organizational performance of Microfinance institutions in Kenya. In this regard, the study specifically sought to establish the impact of knowledge acquisition, knowledge conversion, knowledge application and knowledge protection on organizational performance of Microfinance institutions in Kenya and it was guided by the knowledge based-view, organizational knowledge creation theory, human capital theory and learning organizational theory. This was a descriptive research design where data was collected through questionnaires. The target population was 111 employees of Uwezo Micro-finance bank. The sample size for the questionnaire was 87 respondents determined using Cooper and Schindler’s formula for sample size selection. Quantitative data were analyzed using frequencies and percentages. Results were presented using frequency distribution tables. Qualitative data were analyzed using bivariate correlation analysis. From the discussion of the key findings, the study made a conclusion that knowledge management practices positively impacted the organizational performance of Micro-Finance institutions in Kenya. Regarding this, the study concluded that all the independent: knowledge acquisition, knowledge conversion, knowledge application, knowledge protection had a statistically significant positive influence on the organizational performance of Micro-Finance institutions in Kenya. The study further, recommended that: The Micro-Finance institutions in Kenya to develop and adopt more solid knowledge acquisition initiatives. This would by far impact on human capital development in the organizations what further enhance the organizational performance; the Micro-Finance institutions in Kenya to consider doing knowledge mapping and to introduce cross-functional working relations between the employees of the organization to ensure knowledge acquired is converted and put into proper use; the Micro-Finance institutions in Kenya to consider introducing more formal channels of knowledge sharing within the organization and across the departments such that the employees are able to freely use both new and existing knowledge to solve new or existing problems in the organization; the Micro-Finance institutions in Kenya to develop and adopt more stringent policies and to ensure all the new employees sign with the company a Non-Disclosure Agreement (NDA) before commencing duty in the organization. This would ensure that this intangible asset stays in the organization.