Effect of Knowledge Management on Competitive Advantage in the Real Estate Sector: The Case of Pam Golding Properties

A Research Project Report Submitted to the Chandaria School of Business in Partial Fulfilment of the Requirements for the Degree of Master of Business Administration (MBA)This study’s impetus stems from the realization that the real estate industry in Kenya is currently rife with challenges, despite property pundits auguring its promising future. For real estate firms to remain relevant, research is necessary to investigate the use and management of Knowledge and its effect as a source of Competitive Advantage. The general objective of this study was to investigate the effect of knowledge management (KM) on the competitive advantage of real estate firms. This research was guided by four specific objectives: 1) to determine the dimensions of knowledge management employed by real estate firms in Kenya, 2) to determine the effect of information technology in KM on competitive advantage 3) to determine the effect of leadership style in KM employed on competitive advantage and 4) to determine the effect of organizational structure in the KM employed on competitive advantage in real estate firms. The research design selected for this study was a descriptive research to identify and explain association between variables. The target population for the study were all the fifty employees of Pam Golding Properties (PGP), Kenya. Fifty questionnaires were distributed and 46 responded obtaining a 92% response rate. The study employed Spearman’s correlation and multiple linear regressions for analysis. Data collected utilized SPSS (version 24) software and analysis done gave both descriptive and inferential statistics. Following analysis, results were presented in tabular and chart form and descriptions given. Analysis of the first objective which was to examine the dimensions of knowledge management applied in the firm, revealed that at PGP Kenya, there was a clearly defined system of KM that was widely understood and utilized by both employees and management. However, PGP does not share information with other RE industry players for better knowledge management. The second objective established that employees used technology tools to create, share and store knowledge. Critical to note was that IT in use contributed to enhanced knowledge and eased decision making. Analysis of the third objective seeking revealed that the organization’s leadership embraced an open-door policy and enhanced free knowledge sharing through dialogue and feedback. Many respondents however, strongly agreed that little if any awards or promotions were given for knowledge creation or enhancement. The fourth objective showed that PGP’s organizational structure facilitates task accomplishment according to KM services. This study concludes that PGP Kenya has acknowledged that they viewed KM to be a major strategic imperative for staying competitive in the industry. The firm’s investment in budgetary allocation, staff trainings and IT infrastructure has had impetus from this realization. The main motivator for PGP implementing KM was quality service delivery, competitive advantage sustenance and client acquisition and retention. PGP has enjoyed competitive advantages in innovation, quality service and employee efficiency because of investing in KM. However, it also concludes that PGP could stand to benefit more from KM if it incentivized knowledge creation among employees. From the study it can be inferred that KM has benefited the firm and not only enhances efficiency leading to competitive edge but also delivers expertise to the firm by giving the firm’s agents, the opportunity to focus on its key competencies. This study recommends that real estate firms invest more in KM systems; not only on internal information sharing but liaise with related and supporting industries e.g. banking, to capture and share knowledge that would be vital in alignment of knowledge to business strategy for both industries, ultimately contributing to profitability and performance. The study further recommends that RE firms should strike a balance between people and technology elements of KM. A good technology-based KM system need not be complicated or capital-intensive, in so far as it could serve the core business by providing internal information within a group and sharing customer-specific information with clients. It should further be noted that the best tools and processes alone cannot achieve a KM strategy. Ultimately, KM aims to free up professional ‟valuable” time to focus on creating thoughtful and innovative approaches. For further studies, there is a need to undertake a study to establish the barriers involved in KM implementation between related/supporting industries fundamentally in knowledge sharing in order to bridge the gap between industries