Knowledge Management Maturity and Performance in a Project Environment: Moderating Roles of Firm Size and Project Complexity

Abstract

We develop alternative theoretical models to explain the possible association between knowledge management maturity (KMM) and firm performance within a project-based firm setting. In addition to the direct maturity-performance linkage, we conjecture possible moderating effects by firm size and two aspects of complexity of projects. To empirically evaluate the theoretical model, an instrument measuring KMM and all other key variables was developed and tested. A cross-sectional survey was performed for Singapore construction firms with targeted respondents in senior management. Out of 746 firms that were invited, 68 provided useful responses, a 9% response rate. The result suggests strong, positive moderation effects of firm size and project structural complexity. A relatively weak, negative moderation effect was also observable for project uncertainty. A combined moderation effect of firm size and complexity was also examined. It was found that KMM utility was significantly observable only for a group of construction firms that simultaneously exhibits the two favorable contexts [larger size and high (low) structural complexity (uncertainty)]. This study provides theoretical extension and refinement to understand the KMM-performance relationship. It goes beyond a traditional assumption of direct association—the higher the better. The result also offers interesting practical insights on the benefit of KMM from more nuanced perspectives.