The current world economy has changed from capital based economy to knowledge based economy. It means that company has recognized knowledge as a core. Strategic power for its survival and prosperity and has come to have new management paradigm, so called knowledge management for increasing company competitiveness.
However, it is not easy to measure the outcome of knowledge management since it is invisible.
This study uses the balance performance model of Kaplan and Norton to effectively measure the outcome of knowledge management.
The purpose of the study is to show the importance of knowledge management as a management renovation method for increasing competitive power and improving company values.
This study suggests four performances measurement factors and shows how they influence the competitiveness of a company by an empirical research.
A questionary survey was done to get the research results on a randomly chosen set of large Korea domestic companies which started to knowledge management.
The statistical analysis was done with SPSS 8.0, and the reliability co-efficient total sample was 95.58%.
According to factor analysis, 6 variables were factor 1(management renovation and knowledge ability), 8 variables were factor 2(inner process), 5 variables were factor 3(financial factor), 4 variables were factor 4(customer value).
Using the above 4 factors as independent variables, a multiple regression analysis was done to show how they influenced the four dependent variables of this study the regression analysis showed that all the four independent variables were positively related to the four dependent variables.
All the 16 hypothesis describing these positive relationships were accepted. Especially the factor 1(management renovation and knowledge ability) was found to be the most dominant factor influencing the dependent variables except the inner environment correspondence ability.
This strongly supports the major assertion of this study that it is not financial factor any more, but knowledge that makes a company competent in today's business environment.