Abstract:
In this study, we examine the relationship between knowledge management capability and operational agility which is an important antecedent of competitive advantage in organisations. We first set out to determine the KM and organisational agility dispositions and then tested the relationship between the two in the Kenya banking sector using data from 172 respondents from commercial banks. Data was collected using structured questionnaires that were derived from literature and tested for validity and reliability prior to their use. We found that the relationship between knowledge management capability and market capitalizing agility was weak, negative and not significant at p < 0.05 but at p <0.1 (r = - 0.142, p<0.063). We also compared the mean scores of the two strategic capabilities across a set of demographic variables and found significant (p < 0.01) variation in the two strategic capabilities across age, level education, and working experience. Further, a negative and significant relationship (p < 0.05) was found between both strategic capabilities and all the demographic variables. This one of first attempt to examine the relationship between KM capability (lower order capability) and market sensing agility (higher order capability) in a developing economy context. The findings imply that KM capability has not reached the threshold to positively influence the market capitalizing agility which is necessary for superior performance and that there are demographic characteristics that impact both knowledge management capability and market capitalizing agility. It is recommended that a further examination of KM capability and market capitalizing agility be conducted to determine what aspects lead to negative relationship between these two capabilities and between them and age, education and work experience.
