Page 1 of 11
Journal for Studies in Management and Planning
Available at http://edupediapublications.org/journals/index.php/JSMaP/
ISSN: 2395-0463
Volume 03 Issue 02
February 2017
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 164
Impact of Knowledge Inertia on Organizational Innovation
(Mediating Role of Organizational Learning)
Aqeela.M.S.F1
, Victor. L.D2
1 Assistant Lecturer, Department of Management, Eastern University, Sri Lanka
2
Senior Lecturer, Department of Management, Eastern University, Sri Lanka
aqeelasiraj@gmail.com , vldila@yahoo.com
ABSTRACT
Drucker considers knowledge as the only
competitive advantage of an organization. So
knowledge is considered as an effective resource
for organizations and individuals to survive.
However, individuals usually make use of their
experience and prior knowledge when they
encounter problems, and solve similar problems
in the same solution. These managerial
predictive behaviors may endanger an
organization which is in a competitive
environment. This common routine problem- solving is called “Knowledge Inertia” (Shekari
& Ahmadi, 2011).
The aim of this research is to see the impact of
knowledge inertia in organizational learning
and organizational innovation. The study took
three variables named knowledge inertia,
organizational learning and organizational
innovation which is analyzed in private sector
organizations.
Information was gathered from employees who
are working in private organizations. The
sample size is 200 employees in Puttalam
District. The collected data are presented
through univariate analysis, bivariate analysis,
and simple mediation analysis and cross tab
analysis using the SPSS 19.0 software.
According to the results obtained through the
data, the level of knowledge inertia is in
moderate level and the organizational learning
and organizational innovation are in high level.
Further it is proved that the knowledge inertia
and the two variables organizational learning
and organizational innovation have negative
relationship as well as the organizational
learning and organizational innovation have
strong positive relationship.
On other hand it can be found the
organizational learning plays a role as a
mediator between knowledge inertia and
organizational innovation.
Key words: Knowledge Inertia, Organizational
learning, Organizational Innovation.
1 INTRODUCTION
Knowledge is considered as an invaluable and
effective resource for organizations and
individuals. In the modern economy, knowledge
is the main source of economic and industrial
development
Drucker considers knowledge as the only
competitive advantage of an organization. So
knowledge is considered as an effective resource
for organizations and individuals to survive.
However, individuals usually make use of their
experience and prior knowledge when they
encounter problems, and solve similar problems
in the same solution. These managerial
predictive behaviors may endanger an
organization which is in a competitive
environment. This common routine problem- solving is called “Knowledge Inertia” (Shekari
& Ahmadi, 2011). Knowledge inertia theory was
suggested first by Liao in 2002.
"Inertia" not only has a negative impact on the
exploitation of knowledge, but also may divulge
commercial secrets and strategies that an
organization has.
There are lot of obstacles for efficient and
fruitful knowledge management and
organizational learning.
Page 2 of 11
Journal for Studies in Management and Planning
Available at http://edupediapublications.org/journals/index.php/JSMaP/
ISSN: 2395-0463
Volume 03 Issue 02
February 2017
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 165
Inertia would result in lack of innovation and
expected behavior, which may jeopardize the
survival or undermine the advantage of an
enterprise in a highly competitive environment
(Liao, Fei and Chen, 2007).
Knowledge inertia may pose significant barriers
to organizational learning. Knowledge inertia
may also be a significant barrier to change
innovation and adaptation in turbulent economic
environments (Collinson and Wilson, 2006).
Based on the study the researcher intended to
identify the thing that whether there is an impact
of knowledge inertia on organizational learning
and organizational innovation in private sector
organizations.
Based on the intention of the research researcher
draw some Objective as,
To identify the degree of existence of
knowledge inertia, organizational
learning and organizational innovation
To examine the relationship between
knowledge inertia and organizational
learning
To examine the mediating role
organizational learning
2 LITERATURE REVIEW
2.1 Knowledge
Both as power and as a resource, knowledge is
strategically important for individuals and
enterprises. The third industrial revolution is
based on knowledge which changes the way an
individual, an enterprise or even a nation can
create wealth and prosperity. All together we
can say that the knowledge is so important to
each and every organization. According to
(Drucker, 1995), he states the knowledge as,
“Knowledge has become the key economic
resource and the dominant-and perhaps even the
only-source of comparative advantage.”
2.2 Knowledge Management
Knowledge management has been proposed as a
methodology that can manage the knowledge of
the organization. Knowledge management
defined as,
“Knowledge Management is the process of
sharing, distributing, organizing, creating,
storing and understanding of knowledge about
organization policies, processes and products”
(Ahmad and Khan, 2008).
2.3 Knowledge Inertia
Using the principles of inertia in physics to
knowledge management, Liao (2002) states that
knowledge inertia is a barrier to knowledge
management and may inhibit an organization’s
capability to learn and solve problems. Often
routine problem-solving procedures are adopted
to save time and effort as well as to avoid risks.
Stagnant knowledge sources and obsolete prior
experience result in the same solutions and
approaches being employed to deal with
problems.
So knowledge inertia is a dangerous one for the
organizations. Hence, in order to grasp the trend
of economic development and meet current
challenges, enterprises should seek ways to
strengthen the development of knowledge and
pay more attention to organization and
individual innovation. However, individuals
often have their natural inertia in the process of
innovating depending on the knowledge. They
tend to follow the original path of thinking and
resort to their prior knowledge and experience
for solutions when facing problems.
“Such routine problem-solving strategy is
termed knowledge inertia” ( Liao, Fei & Liu,
2008).
Among the gathered literatures, most scholars
(Zhao & Wu & Wang, 2012) adopt the
definition of knowledge inertia raised by Taiwan
Scholar Liao (2002), who defines knowledge
inertia as,
“People are used to solve problems with the
routine problem solving procedures, stagnant
knowledge sources, and prior experience or
knowledge”
Applying the concept of inertia to human
behavior shows that individuals often resort to
constant methods for dealing with problems
(Liao et al., 2008). (Huff, Huff and Thomas,
1992) describe inertia as,
“an overarching concept that encompasses
personal commitments, financial investments
and institutional mechanisms supporting the
current ways of doing things”.
“The degree of the level of commitment to the
organisation’s current strategy will grow over
time as current ways of operating According to
Liao et al (2008), KI is provided the empirical
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Page 3 of 11
Journal for Studies in Management and Planning
Available at http://edupediapublications.org/journals/index.php/JSMaP/
ISSN: 2395-0463
Volume 03 Issue 02
February 2017
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 166
evidence to support that is comprised of two
dimensions: experience and learning inertia.
Experience inertia is defined as individuals solve
problems with prior experience and knowledge.
Learning inertia is referred as individual learn
knowledge from the same source. However,
Adams et al. (1998) found that inertia hindered
organization capability to learn. In the other
words, inertia could be considered as a barrier
for organizational learning. For individuals, KI
obstructed learning ability, and then affects
organizational learning and organizational
innovation.
Learning Inertia
When individuals feel that by applying past
experience and knowledge, there is no need to
acquire new knowledge, thereby, they face
inertia in learning and teaching stages. In fact,
learning inertia is the opposite of organizational
learning. (Shalikar, Lahoutpour and Rahman,
2011)
Experience Inertia
By experience inertia we mean that an
organization has some problems in its areas of
activity in where experience is very limited and
consequently they are not able to overcome the
obstacles. Experience is considered as one of the
learning sources, which about 70% of learning is
go through that. Learning originates from our
reactions to different situations in our everyday
life.
2.4 Organizational Learning
In this light, organizational learning, defined as,
“The capability for organizations to create,
disseminate, and act upon generated knowledge,
can be regarded as a source”. (Auh and
Mengue, 2005).
Commitment to Learning
Human beings need to learn new things every
day in order to improve their mental and
physical health and ameliorate their growth by
the help of learning which an internal trend is.
We learn from all past experience. All in all, an
individual’s commitment to learning and also
his/her ability to learn is vital for an
organization. (Shalikar, Lahoutpour and
Rahman, 2011). Shared Vision
Shared vision is the discovery of common
images about future, which strengthens real
commitment in the members of the organization.
Vision, points to a clear image and in some
cases abstract topics in future that explain why
we need to work hard to create such a vision
(Shalikar, Lahoutpour and Rahman, 2011).
Open-Mindedness
Open-mindedness is an analytical method for
phenomenon and a way to escape from the
enchanted perceptions. The main idea of “Open- mindness” by Anthony Rothman who is a
modernism thinker- is: “experiences based on
wisdom”. Organizations need free vision, free
expression and self-activation in order to convert
implicit knowledge of the employees to formal
knowledge, share the information and spread
them within the employees. Such elements get
managers prepared for methodology and
knowledge management (Dovenport, 1997, 45).
2.5 Organizational innovation
According to recent negotiations and discussions
about organizational innovation, “producing
new products depends notably on research and
development issues”. (Kuratko, &Hodgetts,
2004, 172-174).
Innovation allows organizations to progress
parallel with the changes flourishing in the
environment. It’s a strategic key in responding
to the new challenges of an environment full of
uncertainties.
Wu et al., (2008) suggest that an innovation is
defined as,
“An idea, a product or process, or a system that
is perceived to be new to an individual”.
Administrative Innovation
Administrative innovation occurs within the
administrative processes and has influence on
social systems in organizations, which include
rules, trends, instructions and communications.
(Shalikar, Lahoutpour and Rahman, 2011).
Technical Innovation
Technical innovation entails importing raw
materials or equipment from other industrial
fields in order to produce new products, which
are made radically different from developing the
usage of the products or new formulation. For,
by combination of several technologies, a
completely different product will be presented.
(Shalikar, Lahoutpour and Rahman, 2011).
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