Are incentives in knowledge management important??
A staff in ‘ABC’ enterprise refuses to share their intellectual knowledge and to use the available knowledge to support organization human resource. This is because the enterprise did not give rewards for every contribution that he/she given. Knowledge sharing culture that occurs in the enterprise is no rewards culture, and the enterprise argues that staff responsibility is giving their knowledge to organization without any reward because they are already being paid. In this situation staff feel there is no advantages for them whether they share ideas or not. In my opinion, giving rewards or incentive is very important thing in knowledge sharing culture. Incentive also motivates staff to do share knowledge and willing to learn new things. (Does this mean that only they give incentives people will share their knowledge. Is it true of everyone?)
Knowledge sharing is very important for organization, because without knowledge sharing activities organization cannot sustain and organization gradually will loose its competitive edge. (Zhang, 2005). And one of the method that been used by organization to motivate its employees is using incentives scheme.
According to www.wikipedia.org incentive has meaning as any factor (financial or non-financial) that provides a motive for a particular course of action, or counts as a reason for preferring one choice to the alternatives. In knowledge management approach, incentive both material and immaterial is being used to motivate staff to share their knowledge. There are two types of incentives namely intrinsic incentive and extrinsic incentive. Extrinsic incentive consist of material (such as money and goods) and immaterial (career, leadership, working environment, qualification). Intrinsic incentive strongly correlated with the work itself. (Semar,2004).
Feurstein et.al. state that when there is no explicit reward in enterprise incentive scheme, the employees prefer to hide their intellectual knowledge rather that share to public.(Feurstein et.al., 2001). It is obvious that employees more appreciate to share their intellect if they are assured on being rewarded.. Employees also think that their intellect is not free. Muller at.al. adding that incentive brings the positive effect on knowledge sharing. (Muller et.al., 25). Through the incentive scheme employees feel more motivated and challenged to learn and share new things. Employees enjoy take and give environment as well as the increase their creativity. Furthermore Dell and Grayson (1998) in (Taylor, 2006) indicate that incentives can encourage knowledge sharing before developing a knowledge sharing culture. Giving financial incentive also can motivate employee helping each other. (Taylor, 2006).
Incentive can be given both to individual and group employee. The group incentive will motivate the team work task and increase the helps other intensity since one task is done by some people. However, individual incentive or usually called tournament based incentive will increase the individualistic and encourage competition. Bonner et al, 2000 in Taylor, 2006). This is quite complicated for the organization when apply an incentive for its employees, sometimes some employees have a conflict to each other because of competition.
Another opinion, applying financial incentive is ineffective (Herzberg, 1968, Bonner & Sprinkle, 2002) in (Taylor, 2006). It supported by Bock & Kim (2002)and Bock et al (2005) that found an expected reward is unrelated with knowledge sharing attitudes.(Taylor, 2006) . Furthermore, Dixon, 2000 said that financial incentive do not promote knowledge sharing. (Taylor, 2006).
In conclusion, incentive both material and immaterial still becomes the primary method to increase and motivate knowledge sharing activities in organization. Employees feel that rewards & incentives is an appropriate barter method.
References:
Anonymous. Incentive. Retrieved May 3, 2007 from World Wide Web http://en.wikipedia.org/wiki/Incentive
Feurstein, M., et.al., (2001). Incentive to share knowledge. Proceedings of the 34th Hawaii International Conference on System Sciences. Retrieved from
Muller, R M., et.al.,(2005). The influence of incentive and culture in knowledge sharing. Proceedings of the 38th Hawaii International Conference on System Sciences. Retrieved from
Semar, W,(2004).:Incentive systems in knowledge management to support cooperative distributed forms of creating and acquiring knowledge. Proceedings of the International Conference on Information and Knowledge Engineering - IKE’04. Retrieved May 3, 2007 from World Wide Web http://www.inf-wiss.uni-konstanz.de/People/WS/ike04-cc.pdf
Taylor, E.Z,(2006). The Effect of Incentives on Knowledge Sharing in Computer-Mediated Communication: An Experimental Investigation. Journal of Information Systems. (20)1: 103-116. Retrieved from
Zhang, Z,(2005). Managing knowledge assets in organizations: Role of incentives and information systems. DAI-A 66/12, Jun 2006. Retrieved from
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The following article may be useful:
Siemsen, Enno, Sridhar Balasubramanian, and Aleda Roth (2007), “Incentives that Induce Task-
Related Effort, Helping, and Knowledge Sharing in Workgroups,” Management Science, vol.
53, no. 10, p. 1533-1550.