The Influence of Knowledge Management Practices on Performance of Selected Global Audit Firms in Kenya

Abstract

The business environment within which firms operate has been very unstable. The political anxieties, competition from new entrants. Adoption of urgent measures has helped control these challenges as this industry is of much importance to the country’s economy. Audit firms respond to competition in different ways. KBV has identified that advanced knowledge is a key ingredient to enhancing productivity of audit firms. Despite knowledge being recognized as an important asset many audit firms are not doing enough to effectively manage this important asset for competitive advantage. There has been limited knowledge on empirical evidence on the influence of knowledge management practices on performance of Kenyan auditing firms, hence the research gap. There are convincing reasons for organizations such as audit firms to adopt knowledge management practices, to enhance their performance, in the wake of declining tourist number in Kenya. This study sought to examine the influence of knowledge management practices on Kenyan auditing firms. The study adopted a descriptive cross-sectional design, which is used when a certain problem has been specially described and when the researcher is explained for the problem by the respondents. It aimed at examining the influence of knowledge management practices on selected Kenyan audit firms. The target population was the 156 personnel of (4) four audit firms (EY, PricewaterhouseCoopers, KPMG and Deloitte & Touché ), who are management staff stationed at their Head Offices in Nairobi. This research problem was studied using census survey. Questionnaires were used to collect mainly quantitative and qualitative information. Quantitative data gathered was analyzed using descriptive statistic such as percentages, averages, standard deviations and frequencies. Bar charts, graphs and pie charts depicted the information. A regression model was used to depict the connection between the various variables. The study found that knowledge identification, knowledge acquisition, knowledge sharing and knowledge application signficantly affected the performnace of audit firms in Kenya. The study also revealed that knowledge identification, knowledge acquisition, knowledge sharing and knowledge application had positive significant effect on performance. There is need for the management of audit firms to improve on their knowledge transfer as the study found positive association between performance of audit firms in Kenya and transfer of knowledge. There is need for the management of audit firms to improve their strategies for knowledge application strategies.