We at MTR always ask candidates about their preferred organisation with respect to culture and working environment. Usually candidates focus on the size of the company as a cultural yardstick and add opportunities to learn, develop and be creative as key to their choice of new employer. Most talk about training budgets and allude to external courses.

Interestingly, most learning comes from within the organisation itself.

A series of recent studies turned up some interesting information on how the size of an organisation can have an impact on its ability to share knowledge and innovate.  Large companies are defined as having more than 250 employees and small to medium sized enterprises (SMEs) as having 250 or less.

  • While large and small organisations saw the correlation between knowledge sharing and innovation, the results showed that neither group had yet identified a requirement for a specific person to be responsible for knowledge management.
  • Larger companies, with relatively more resources, believed they were probably better equipped to develop strategic knowledge management systems whereas smaller companies recognised the importance of gaining knowledge from within and sharing it amongst the smaller workforce.
  • Both agreed that the culture of the organisation had a major impact on the ability of any organisation to be innovative.
  • Both recognised that knowledge seemed to be captured more at the senior management level .

A further study, focused on SMEs only, provided some interesting insights. Larger sized SMEs (being a maximum of 250 employees) were more strongly committed to updating their existing products whereas smaller companies were more technologically innovative.  When it came to managing knowledge, the study found that larger SMEs were better at building structure around handling, managing and imparting knowledge, which included having specific knowledge management systems in place.  Research appeared to suggest that SMEs with a staff of between 26 and 50 were more dissatisfied with the organisation’s ability to capture, share and manage tacit knowledge.

These findings contradicted previous research which showed that as the size of an organisation increases, the ability to share knowledge both internally and externally decreases.  It was previously suggested that as an organisation surpasses 150 employees, issues arose due to the more complex organisational structure. There was less effective communication, weaker interpersonal relationships between teams and team members and a decreased level of trust between employees.  It was suggested that the larger the organisation, the more bureaucracy became an issue. Yet research elsewhere suggests that larger organisations can still be innovative.  This appeared to be due to the larger number of employees available to generate ideas.

However, the key to innovation remains the ability of employees to be willing enough and able enough to share and tap into the organisation’s retained knowledge. Willingness to engage and share knowledge came down to the ability of the larger organisations to foster affective commitment amongst its employees. This suggests that well defined strategies around knowledge management and affective commitment are both essential in maintaining innovation and a resulting competitive edge.

In other words, no matter how large or small an organisation is, opportunities to develop, learn and be creative depend on how well the company manages its knowledge and how it treats its employees. Assessing both attributes involves asking questions, at interview, about whether the organisation is geared up to encourage knowledge share from its employees and how freely it then disseminates that information within.