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RESEARCH ARTICLE
Abstract:
Background:
Currently, the issue of a company’s innovative and competitive development is relevant in all areas of activity. The automobile industry, having
innovative component as one of the development vectors, is faced with the task of achieving high competitiveness through active innovative
learnings. This direction is influenced by Knowledge Management (KM) factors, which have a strong impact on the organizational leadership
actions of automobile corporations.
The automobile industry in Thailand is considered successful due to fast-driven KM and technology transfer activities. Unfortunately, the growth
of the Thai auto industry is directly dependent on the performance of the offices of large international leading corporations; therefore, whether the
Thai auto industry will be able to maintain the same marketing position through its own knowledge and technological capabilities is a question.
This study analyzes the impact of KM-based organizational leadership in the automotive industry in Thailand using a Korean case study. Our
research analyzed the knowledge-driven aspects of the automobile industry of Thailand and South Korea to identify the key factors that have a
direct impact on competitiveness through the organizational leadership actions in these two countries.
Objective:
The study aims at investigating KM factors that influence the organizational leadership development of Korean and Thai automotive companies
and evaluating their interdependence using the Cronbach alpha test.
Methods:
This research is based on statistical data and considers the specifics of the studied industry. It has limitations and uses quantitative data to generate
results. The main source of data collection is open source. The test results for each component are organized according to the Cronbach alpha test.
Results:
Two automobile corporations from the Asian region were investigated. The application of organizational leadership in the technological field of
automobile companies and knowledge transferring processes was found; an interdependence between the KM and organizational leadership was
discovered as a result.
Conclusion:
Organization leadership could be used as an application for KM process development within the technological area of automobile companies.
These findings can be used by managers to develop strategic programs to improve the knowledge transferring process and the organizational
leadership in Asian automobile companies.
Keywords: Organizational leadership, Automobile industry, Cronbach alpha test, Knowledge management, Intellectual capital, Asian region.
Article History Received: July 30, 2020 Revised: December 20, 2020 Accepted: January 20, 2021
valuable human resources [1]. In addition, this transformation vidual, group, and organizational). Table 1 shows the
requires a combination of convergent, divergent, and creative categories of knowledge, their dependent and causal elements,
thinking from both managers and key personnel. In other and the structural components that are generally known or
words, as the new external environment develops, necessary in an organization.
organizations undergo changes, and internal competencies and
knowledge develop; all these processes are much more This classification introduces the core of the KMS. It is
complicated. Even the level of knowledge as a valuable asset is obvious that, in the case of ineffective work of managers, most
currently under threat because the very structure and types of of this knowledge will certainly be lost as a result of these
knowledge are changing. This is why organizational leadership changes. In this case, it is imperative to identify implicit
helps to gain required competencies and values. (hidden) knowledge, transform it into explicit knowledge, and
inform management decisions [6]. Therefore, there has been a
The automotive industry in Thailand has a successful
growing attempt in order to maintain a good level of
history. It plays an important role in the national economy and
knowledge in the form of a knowledge-based economy, which
every year strengthens its position as the center of auto
is in fact one of the most critical duties of automotive
production in Southeast Asia. Home to world-class
organizations. That is why organizations have made attempts to
automobiles such as Ford, Toyota, and Nissan, Thailand is become learning organizations [7].
known as “Detroit of Southeast Asia”. However, the growth of
the industry depends on the productivity of Transnational Every modern automotive company, facing rapid changes
Corporations (TNCs), so there are high risks regarding whether in the industry, tries to maintain the established competitive
the Thai auto industry can maintain its previous technological advantage. In such a situation, there are two ways to maintain
and economic positions only with its own technological competitive advantages: changing the existing strategy or
completely replacing it. Automotive companies have become
capabilities.
equipped with the latest technology to be efficient and effective
This case study uses a qualitative method to analyze both under new conditions [11]. However, realizing the importance
the Thai and Korean auto industries since 1960, with the aim of of flexible knowledge, they have decided to combine human
analyzing and comparing the Thai auto industry and the capital and accumulated knowledge with the production of high
Korean auto industry in the development and transformation of technologies. According to K.D. Lawrence et al. (2016), in this
knowledge. This article analyzes the dynamic process of regard, organizations began to use IT and high technology
technology learning and the formation of key knowledge in together with innovation to achieve efficiency [12]. In this
industries using the following structures: the global structure of approach, the effectiveness turned out to be weak since the
the technological environment, the structure of the institutional need to combine the type of knowledge with the types of
innovations produced was not taken into account, so there was
environment, and the structure of dynamic technology learning.
no added value over the long term. It was then that automotive
Over more than six decades, the automotive industry has companies realized that, in order to make progress, emphasis
evolved from an agricultural economy to a fast-growing must be placed on other core values, such as organizational
manufacturing economy in many developing countries, culture, human capital, and intellectual potential.
including South Korea and Thailand [2]. At the initial stage, Knowledge management is essential for the development
South Korea and Thailand did not have their own accumulated of organizational leadership and product innovation, especially
technological capabilities for production. The Government's in the automotive industry. The need to create a flexible
scientific policy has played a key role in the development of internal environment conducive to open internal
the industry in both countries [3, 4]. The dynamic development entrepreneurship and individual commitment to stable
of the automotive industry in Korea is a success story that sets corporate creativity has also been mentioned in the previous
an example of the rebirth of the catch-up economy into a literature [13]. A balanced (in combination with environmental
leading global manufacturer with competitive knowledge. The conditions) organizational environment is very important for
South Korean auto industry has proven its ability and interprofessional activity, as it is driven by the goal of the
commitment to produce its own national cars. Korea has prosperity of innovative human capital. It requires behavioral
established and maintained a unique and independent human models for innovative ideas that translate new knowledge into
resources strategy for the automotive industry. An independent the service industry, operational and management processes, an
national strategy protected local firms from overseas TNCs that organizational structure, and process customization [14].
took control of the industry. The country has invested in According to H. Dimitriou and R. Gackenheimer (2011),
Research and Development (R&D) for product development there are several important elements of creating a suitable
and has relinquished management control in a joint venture intra-organizational environment and achieving organizational
with TNCs, thereby accelerating the process of creating its own leadership focused on innovation [15]. These elements include
core competencies [5]. leadership motivation to build, promoting human capital and
generating new business ideas while allocating free time, a
In order to successfully build a Knowledge Management comfortable organizational structure to freely advance
System (KMS) in an organization, it is necessary to take into knowledge of innovative human capital, proper use of
account that knowledge consists of various components (indi- corporate culture, an understanding strategy, and tolerance for
taking risks. It has been emphasized that the automotive
* Address correspondence to this author at the School of Industrial Management,
Korea University of Technology and Education (KOREATECH), 1600
organization must benefit from the ability of its employees to
Chungjeol-ro, Byeongjeol-ro, Cheonan City, South Korea; Tel: +82-1099969553; innovate and share knowledge in order to transform the
E-mail: [email protected] organization and make it more competitive [16].
18 The Open Transportation Journal, 2021, Volume 15 Shvetsova et al.
2. KNOWLEDGE MANAGEMENT IN THE quality products. At the same time, automotive companies need
AUTOMOBILE INDUSTRY: A LITERATURE REVIEW to increase the flexibility and adaptability of organizational
design, collect relevant information, create effective
2.1. A Revolutionary Look at Knowledge Management knowledge, share it, and constantly learn. All this is impossible
Modern problems of reducing the impact of direct without close and skillful attention to the creation, renewal,
globalization on local and regional markets require managers to availability, quality and use of knowledge by all employees and
think about new management models, including those related project teams who create innovations at work (in the internal
to KMSs and technology management. According to K.D. environment) and in the market (in the external environment).
Lawrence (2017) [17], these challenges are as follows: In fact, according to Roos J. and Roos J. (1997), employees
(1) Human-oriented factors (culture, people, and of organizations can create intellectual capital using the tools
leadership): Humans work as well as collaborate and of meritocracy, which is based on their attitude towards the
communicate based on culture (both organizational and ethnic, result and their intellectual flexibility [18]. Basic and necessary
such as a regional/national culture), so typical Knowledge competencies related to education and experience, and
Management (KM) activities such as knowledge sharing are intellectual dexterity, as a key modern competence, prepare a
strongly influenced. person to easily perceive changes, quickly adapt to them, and
find innovative solutions in various difficult situations (Lank,
(2) Organization (process and structures): Organizational 2017) [19]. Another approach says that the human capital of an
processes also differ depending on the organizational and organization includes the skills and knowledge needed to solve
geographic culture. Obviously, it is necessary to coordinate problems and a variety of leadership styles (Brooking, 2016)
KM processes in distributed automotive organizations and [20]. The key issue is that human capital is formed only on the
between organizations with different organizational and ethnic basis of intellectual assets that need to be extracted or created,
cultures. and if employees are properly motivated to share their
(3) Technology (infrastructure and applications): knowledge and experience, this can significantly increase their
Technology infrastructures also differ in different countries. level of efficiency and lead to an increase in commercial results
This acceptance of applications is also dependent on (K. Natsuda and J. Toburn., 2011) [21]. Since such experience
preferences (e.g., how technologies are accepted, which and knowledge is something abstract in the minds of every
technological networks are preferred in this industry in this employee of the automotive organization, then any
country). organization striving for success must manage them well in
order to activate them and use them to create value in the
(4) Management system, which includes elements,
market.
parameters of assessment and measurement tools: Approaches
to management change depending on the policy of corporate KMSs are designed to manage the knowledge of an
culture and ethics. Therefore, any KM methods should be organization. W.A. Bhatti et al. (2011) emphasize that KMSs
combined with a chosen strategy for managing the automotive are, first of all, IT systems designed to support or improve the
organization as a whole [17]. processes of creating, storing/retrieving, transferring, and
applying knowledge [22].
In order to serve customers flawlessly in such a changing
environment and consolidate their position in the business, According to these authors, there are two approaches to
companies must shorten production cycle times, operate with building KMSs: a process (task-based) approach and an
minimal costs in fixed assets, reduce overhead costs infrastructure (general) approach. The process approach
(personnel, inventory, and infrastructure), reduce product focuses on the use of knowledge within a certain process, task,
development time, improve service customers, empower or project to increase their private and general efficiency. This
employees, drive productive innovation, and produce high- approach determines the needs of the process only for
Organization Leadership in the Automobile Industry The Open Transportation Journal, 2021, Volume 15 19
information and knowledge directly related to the process. The the authors adhere to the basic concept of the KM process,
infrastructure (general) approach is used when the organization which can be summarized in several stages as follows:
is well structured and has common strategic objectives in
1. Creation of knowledge. Knowledge is a secondary
knowledge and technology management. The process of
product of experience and skill. Explicit knowledge is created
identifying key competencies that are able to determine the
when people make an effort to find a new way to accomplish
leading organizational functions and identify tasks in the field
their tasks or to solve a problem, and sometimes to prevent it
of KM comes to the fore. The approach uses the network
from occurring. Knowledge is then classified into new
bandwidth, its structure, and the way the database is organized
categories and synthesized to create new explicit knowledge.
and aims to form a classification of knowledge and
The creation of this kind is the result of social interactions and
information.
effective communication strategies (D. Pojani and D. Stead,
Both approaches are rational and can be used to create a 2015) [26].
complete KMS. The process approach supports specific work
2. Restoration of knowledge. Knowledge needs to be
activities, while the infrastructural, or generic, approach
preserved and restored in the organization. It is usually
consolidates organizational knowledge into a single system that
recovered in documents, databases, and key organizational
can be used for the tasks of the entire organization, not just the
processes.
tasks of the process or project. Most interesting is the approach
of the Knowledge Habitants of Charles (1989), which supports 3. Application of knowledge. Knowledge by itself has no
the concept of a dual approach, proposing to develop an value if it is not used. When it is used in an organization to
organization-wide KMS to integrate various task-/process- accomplish and facilitate tasks in a specific way, then it is
based KMSs into a single environment and integrated system considered valuable and contributes to the creation of core
[23]. After implementing the KMSs, regardless of the approach competencies and competitive advantages.
and classification, it is necessary to determine the success or
4. Transfer of knowledge. In fact, it is the process of
effectiveness of the chosen strategy by looking back at the rate
transferring knowledge in an organization between processes
of change in the external environment. J. Guimon (2017) lists
and people. Dissemination occurs throughout the organization,
three reasons for measuring the success of a KMS:
among employees and between organizations, when they use
1. To provide a basis for company valuation; any communication channels.
2. To stimulate management to focus on what is important;
2.2. Organization Leadership and Transferring Innovations
3. To justify investments in KM activities [24].
It should be noted that a systematic focus on the three basic
It is known that there are two main types of knowledge: principles of management is the foundation of any successful
implicit and explicit. Implicit knowledge is difficult to innovative organization. First, innovation must be part of the
articulate and express in words, text, or pictures and therefore main strategic planning process (so far, only a few global
requires more management effort. Explicit knowledge is automotive companies have succeeded). Only with this
content that has been recorded in any tangible form, such as approach can a successful motivating environment for
words, audio recordings, or images. Automotive companies innovation be created, as well as managed, monitored, and
most often develop their own explicit knowledge bases that are measured. All of these processes are embedded in a key
protected from outside use. element of a growth-oriented strategy. Second, managers
There is also a kind of paradox here: It is usually a little acquire existing (and often untapped) opportunities for
more difficult for highly qualified and experienced personnel to innovation without wasting resources on new change programs
articulate their ideas and knowledge. Newbies, on the other that reduce the effectiveness of ordinary work. At the same
hand, are more likely to easily articulate what they are trying to time, they create conditions for the emergence and dynamic
do because they usually follow the instructions for the process development of organizational innovation networks. Third, key
and do not have enough negative experience with any personnel can make clear decisions to promote a culture of
innovative implementation, which is the reason for the innovation based on employee trust and knowledge transfer
decrease in motivation. A popular misconception of many from one competence center to another. If such an
managers and authors is that KM focuses on displaying what is organizational culture is created, the staff realizes that their
implicit in more explicit or tangible forms, and then stores or ideas are perceived and appreciated, and that they can freely
implements those forms somewhere, usually in some form of share ideas and, together with management, find ways to solve
intranet or knowledge portal. However, any knowledge has its problems (C. Cho, 2014) [27].
own expiration date, so it should not only be stored, but also Since new ideas always generate other ideas as part of a
changed and improved depending on the needs of the external network of interaction, organizational networks of specialists
environment. allow the creation of whole cycles of innovation. Moreover,
KM is, in fact, a systematic activity throughout the effective networks enable people with different knowledge and
organization, designed to integrate the process of coordination problem-solving techniques to leverage the synergistic effect of
of competencies, which includes the creation, exchange, ideas overlapping. Therefore, by focusing on getting the
storage, and application of knowledge to achieve broad maximum result from innovation networks, the management
organizational goals (M. J. Gallivan, 2011) [25]. Although team can achieve more based on the available resources
different points of view have been given on the KM process, without launching large-scale transformation programs, which
20 The Open Transportation Journal, 2021, Volume 15 Shvetsova et al.
significantly saves resources [28]. the owner of the technology) believes in the exaggerated value
of the invention, so the technology audit is very important at
An analysis of existing innovation networks in a company
the first stage of the transfer process. The selection of
helps management personnel analyze their characteristics
assessment criteria is determined by the purpose of the audit
(frequency of cooperation, degree of cross-functional
interaction of network participants, etc.). Moreover, such and varies by industry, region, and specific environmental
interaction allows us to identify people who are most actively conditions. Technology audit involves determining the
transmitting information and knowledge. Such information can technical level and assessing compliance with industry
greatly help in building effective innovation networks: development trends, assessing the level of patent protection
managers can better understand the behavioral motives of and patent purity.
employees and groups and create the most effective Some authors describe and demonstrate the possibility of
workforces. influencing the assessment of knowledge of other components
We have described several formalized organizational of the organization's management system. Therefore, there are
mechanisms for using leadership skills to drive innovation. If many models and approaches to assessing knowledge, but they
the company's management is able to apply these mechanisms should be chosen depending on the strategic objectives.
to solve specific problems, then it usually achieves competitive Widespread discussion of the importance of knowledge in
results. Leading companies use different methods of building managing an organization followed the work of Sveiby (1997)
an innovation culture. in Sweden [29]. This author first raised the question of the
influence of knowledge on the strategic assets of the
1. Dissemination of the idea of innovative development organization and revealed the various effects of their
among top-level personnel. It is great when the head of an assessment on the behavioral model of the organization. Since
enterprise takes innovation responsibly and holds regular then, other authors have supported these approaches and have
meetings on innovation. However, this is not enough. All begun to develop various theories of KM in organizations [30].
managers must agree that driving innovation is a key part of
the company's strategy in order to determine how their personal 3. METHODOLOGY
goals align with innovation objectives and how to drive
innovation through their own example and how to motivate In accordance with modern scientific sources, the elements
middle managers. of the KMS are considered by managers and scientists as
dependent variables, and the results of the functioning of such
2. Transformation of the most successful managers into a system, that is, the processes of knowledge production and
leaders of the innovation process. This means that the knowledge capitals, are considered as independent variables. A
organization needs to evaluate and help managers strengthen conceptual model for this study is shown in Fig. (1).
their mentoring and mediation skills so that they can develop
their teams more effectively through effective workforce Having studied the literature, the authors put forward a
organization. As a result, networks will become more efficient. hypothesis that the knowledge capital of an organization has a
serious positive impact on the development of organizational
3. Create opportunities for guided experimentation and leadership of an automotive company in the implementation of
quick success. Unsurprisingly, this approach is the best for the process of transferring innovations and technologies.
launching a change program in large organizations. The ability
to quickly achieve concrete success is even more important in The research methodology is based on quantitative data
terms of innovation: people need to see real results and obtained in the public domain and limited in time. Moreover,
participate in the change in order to get down to business employees of Korean and Thai automotive manufacturing
quickly and learn as you go, select an innovative topic or area, companies were interviewed, their technology and knowledge
and create small project teams. strategies were analyzed, and experts were involved.
Today's large automotive corporations are competitors if Cronbach’s alpha, α (or coefficient alpha), developed by
they demonstrate an ability to manage change, including Lee Cronbach in 1951, measures reliability or internal
creating dynamic synergies of new technology applications consistency. “Reliability” is how well a test measures what it
and, accordingly, the manifestation of the rapid growth of the should. For example, a company might give a job satisfaction
potential of new technologies. At the same time, the key task of survey to their employees. High reliability means it measures
reducing costs while maintaining the level of quality and job satisfaction, while low reliability means it measures
competitiveness remains. The ability to combine the something else (or possibly nothing at all).
capabilities of technology with the needs of the market in the Cronbach’s alpha tests to see if multiple-question Likert
face of rapid change and an uncertain environment is the key to scale surveys are reliable. These questions measure latent
the future prosperity of a particular business, requiring high
variables, hidden or unobservable variables, such as a person’s
agility from the company.
conscientiousness, neurosis, or openness. These are very
Technology transfer is a process based on an accurate and difficult to measure in real life. Cronbach’s alpha will
reliable assessment of the commercialization potential of a determine whether the test designed is accurately measuring
development. Usually, the initiator of the transfer (the author or the variable of interest.
Organization Leadership in the Automobile Industry The Open Transportation Journal, 2021, Volume 15 21
Knowledge capital
Structural capital:
organizational culture,
Effectiveness of
organizational structure,
organizational learning,
organizational
operational process, leadership
information system
A high level of alpha may mean that the items in the test
are highly correlated. However, α is also sensitive to the (1)
number of items in a test. A larger number of items can result
in a larger α, and a smaller number of items in a smaller α. If Here, N is equal to the number of items, c¯ is the average inter-
alpha is high, this may mean redundant questions (i.e., they are item covariance among the items, and v¯ is the average
asking for the same information). A low value for alpha may variance.
mean that there are not enough questions on the test. Adding
more relevant items to the test can increase alpha. Poor A rule of thumb for interpreting alpha for dichotomous
interrelatedness between test questions can also cause low questions (i.e., questions with two possible answers) or Likert
values, as can measuring more than one latent variable. scale questions is as follows:
and South Korea for the study due to the following reasons: (a) international source by exchanging a share of organizational
The automotive industry in South Korea has been developing capital in exchange for access to technology. For example, 12
rapidly for over a decade and is one of the key industries that percent of Hyundai shares were transferred to Mitsubishi
has contributed to the creation and transformation of new Motors, and Kia transferred 20 percent to Ford in order to gain
industrial knowledge to create a new development path access to the technology. However, in the case of the Daewoo
economy. This successful example is seen as an effective cooperation, the joint venture with GM initially showed
model for creating a development plan for other developing significant results through successful knowledge exchange and
countries. b) Although it took six times longer, the Thai auto integration into the international environment. However,
industry has followed a very similar economic development without effective management oversight, Hyundai could not
path to South Korea; however, in terms of knowledge, develop its own product to meet market needs. For this reason,
Thailand still lags far behind. As a result, it is important to Daewoo switched to a strategy of independence and increased
explore the path of development of industry knowledge, as well its productivity using the internal resources already
as search for improvements in innovation for the Thai accumulated by that time. In Thailand, as in the case of
automotive industry in the near future. Daewoo, a joint venture with foreign TNCs limited the
productivity of local companies. This indirectly influenced the
Over the past century, the development of the automotive
development of technological potential and promoted the
industry has become one of the central areas of the global
activation of Thai companies to create their own independent
economy and has spread throughout the world. The center of
strategy.
the global automotive industry moved from the European
continent to other parts of the world: the United States in the This study is based on these research questions below:
1920s and to Japan in the 1980s after the oil crisis of the 1970s
1) How does KM affect the organizational leadership of an
[30]. In the early 1980s, global car production was around 30
automobile company?
million units. The seven-leading auto-manufacturing countries
(Japan, USA, Germany, France, Italy, UK and Canada) 2) How do knowledge and intellectual capitals depend on
dominated 80 percent of global vehicle production. In the 20th each other?
century, the global automotive industry was actively influenced 3) What is the role of innovative learning in the automobile
by globalization and increased the number of joint ventures industry?
between car manufacturers in different regions of the world, as
this provided quick access to various markets. As the trend of 4.2. Thai Automobile Industry
internationalization expanded significantly, trade policies of
other trade sectors affected the automotive industry, which also Over 50 years, Thailand proved its potential for fast
affected knowledge transfer. Thanks to this, many foreign car development of automotive manufacturing and has become a
manufacturers have achieved success in local and regional leading global automotive production base in the Association
markets. Japan became the first East Asian country to build and of Southeast Asian Nations (ASEAN). From an assembler of
export assembly plants overseas, and then became the world's auto components to a top automotive manufacturing and export
leading automaker. In the context of the increasing influence of hub, its performance achieved more than 1.98 million vehicles
globalization, automobile manufacturers began to hire foreign produced and was worth USD 27 billion in 2017. These
suppliers because of lower production costs, improved quality, successes also ranked the country as the best automobile
shorter lead times for key components, and more reliable producer in Southeast Asia, the 6th best commercial vehicle
services (US International Trade Commission, 1985) [30, 31]. producer, and the 12th best automobile producer in the world in
Demand and production grew steadily together. The 2017 (Fig. 2).
bankruptcy of American Companies General Motors and The largest production consists of 960,413 pickup vehicles
Chrysler in 2009 marked the end of American leadership in the (48 percent), 818,440 passenger cars (41 percent), and other
automotive industry, marking the end of the Detroit era and the commercial vehicles (11 percent). In line with its ambitious EV
end of the era of mass production in leading manufacturing targets, the Thai government is aiming to become the leader of
industries. China is emerging as a major player in the global The Association of Southeast Asian Nations (ASEAN) by
automotive industry thanks to huge domestic demand. After 2025. By 2030, Thailand plans to produce more than 2,500,000
World War II, some developing countries, the so-called New units and increase the production of electric vehicles to 30% of
Industrial Economies (NIS), tried to catch up with the the total annual car production [32].
developed countries by assimilating their technologies. Thus,
those countries that bet on maximizing their research potential According to the Investment Council of Thailand (2019),
achieved rapid economic growth, and some of them reached a the automotive industry is one of the most important sectors of
point where they had forged their own individual path and were the economy in helping to overcome the middle-income trap.
then ahead of the formerly leading countries. The extensive economic plan for special economic zones
provides more investment opportunities for foreign businesses
We propose to consider innovation as a technological in Thailand [33]. A full range of economic benefits and
learning process and the result of the effectiveness of incentives for cars, engines, and parts in border areas such as
knowledge dissemination. There are three sources of Tak, Sa Keo, Mahon Phanom, and Kanchanaburi has been
technology learning: an international source (resources), an supported and implemented to link with the ASEAN Economic
internal source (ability), and an internal effort (motivation). Community (AEC) [34].
South Korea acquired technology as a resource from an
Organization Leadership in the Automobile Industry The Open Transportation Journal, 2021, Volume 15 23
Fig. 2. Number of passenger cars produced in the Asia Pacific region in 2019, by country or region (in 1000s).
Source: STATISTA, 2020 [31].
According to the Investment Council of Thailand (2017), automotive and mechanical engineering sectors. However,
the main research work is carried out at the R&D and training statistics from the National Statistical Center showed that the
center for car assemblers. For example, Toyota Motor supports educational level of most workers in the automotive industry is
vehicle and technology development, including product below the university level. Although Thailand has a skilled
planning, engineering design, and localization. Each R&D workforce, more than half of them lack engineering skills,
center carries out its own independent but market-oriented which are currently among the main scope of skills. The BIO
development. There are currently five automotive R&D centers forecast (2017) states that, in 2021, the percentage of highly
established by automotive assemblers in Thailand (Table 2). skilled workers with a college degree will reach 61 percent of
Moreover, the Thai government supports the automotive all workers in the Thai auto industry, while 27 percent will
industry through the implementation of the Automotive Master have a Bachelor's degree in engineering, and only 5 percent
Plan, setting targets for Thailand to achieve a higher added will have a Master's or higher. Many automotive companies in
value by 2021. Thailand are developing their own employee training programs
to help improve their competitiveness and efficiency
Table 2. Thailand Automobile R&D Centers.
(Investment Council of Thailand, 2017) [36]. We think this is a
good way to find and manage one’s own corporate knowledge.
Company Activities
Toyota Motor Asia Support for car development and technology The Thailand Automotive Institute (TAI) has developed a
Pacific Engineering and in 11 countries in Asia-Pacific, Africa, and technology roadmap for 2012-2016 to implement a joint R&D
Manufacturing South Africa, in 4 research fields including strategy with other organizations. The purpose of the map is to
product planning, engineering design, strengthen Thailand's position as a technology leader in
evaluation, and localization.
ASEAN. The private sector creates and operates research,
Nissan Technical Center Support for car development in 6 Nissan
development, and engineering activities.
South East Asia production sites across Asian countries.
Responsibility for all R&D processes. According to the ASEAN auto industry, Thailand's
Isuzu Technical Center Covers each single scope of light Investment Council has responded to strong domestic demand
of Asia commercial vehicle (LCV) and private for electric vehicles with support, tax, and import tariff
passenger vehicle (PPV) research and
exemptions for major vehicle components, including engines
development for the whole world.
and batteries. This proves the potential of the local market as a
Honda R&D Asia Elevated to be an automobile design and
leading center for the production of Electric Vehicles (EVs) in
Pacific R&D center in 12 countries across Asia and
Oceania. the Southeast Asia region (ASEAN Report, 2012) [37].
Mitsubishi Motors First outside Japan research and
Proving Ground development proving ground. Multipurpose 4.3. The Korean Automobile Industry
testing. According to Kim & Hwang (2000), in the 1950s, the
Source: Board of Investment, 2017 [35].
Korean government supported the chaebol system as the
According to the Investment Council of Thailand (2017), backbone of industrialization for ambitious export purposes. A
the number of workers in the Thai auto industry in 2016 chaebol is a large industrial conglomerate that is run and
exceeded 7,000,000 persons. Thailand has 29 universities and controlled by an owner or family in South Korea. A chaebol
other institutions offering educational programs in the often consists of many diversified affiliates and is controlled by
24 The Open Transportation Journal, 2021, Volume 15 Shvetsova et al.
an owner whose power over the group often exceeds legal 2018, about 32 thousand FCEVs were delivered to South
authority. The Foreign Capital Attraction Act (FCIA) has Korea. In addition, as of March 2018, about 9.3 million South
increased foreign direct investment in South Korea [38]. The Koreans were using car-sharing systems [41]. The number of
purpose of attracting foreign capital in Korea was to establish a electric vehicles and gas stations for them is also rapidly
balance between payments and access to resources such as increasing.
technology and knowledge. Korean car firms offered equity in
The Korean Automobile industry entered the foreign
exchange for access to technology and self-government
markets with overseas production of 1.88 million units in 2009.
because they themselves had a complex system of innovation.
Korean automobile manufacturers established local plants in
Moreover, the Korean government wanted to redirect limited
many countries around the world. The purpose of Korean
capital resources to industries vital to long-term economic
automobile manufacturers was to sustain growth as a world-
growth (Kim & Hwang, 2000) [39]. For this reason, Korea has
leading auto producer. Recently, with modern technology, the
shifted its national economic interest towards a unique and
Korean auto industry has focused on eco-friendly cars such as
independent strategy.
hybrid cars, electric cars, and fuel battery cars. Policy support
The Korean automotive industry began in the 1960s. The has been enhanced to improve the quality of the industry (KSP,
increase in the amount of used military equipment during the 2014) [42].
war raised the number of repair enterprises. The experience of
Korean workers and their knowledge has been an important 5. DATA ANALYSIS AND RESULTS
asset and an important resource for the development of the The results of testing each component in accordance with
Korean auto industry. National auto parts factories such as the Cronbach alpha test are as follows:
Daewon Global and Yoosung were established in 1953. The
Sibal is Korea's first assembled car from used parts. In 1955, ● Creating and acquiring component: 0.70;
seven Sibals were produced, and in 1957, this number ● How to store knowledge: 0.78;
increased to 459. However, many studies have estimated that ● How to share knowledge: 0.78;
Korean automobile production began with the assembly of the
Knockdown (KD), and a significant number of vehicles were ● How to use knowledge: 0.79;
produced in 1962 [40]. ● Human capital: 0.70;
For decades, South Korea's automotive industry has grown ● Structural capital: 0.75;
exponentially and has also been an indicator of the economic
● Communication capital (partnership): 0.74;
growth in the East Asian region. This main industry in the
country influenced other industries as well, such as electronics, ● The total expert opinion: 0.72.
advertising, financial services, and construction. The
Since the Cronbach's alpha coefficient in the expert
automotive industry in South Korea is currently undergoing
opinion is 0.7 higher than the required minimum, the
major changes that began even before the COVID-19 period
objectivity and reliability of the expert opinion are confirmed.
(Table 3). The South Korean government intends to produce
To once again check the reliability of the expert opinion, the
6.3 million fuel-electric vehicles (FCEVs) and build 1200
authors additionally carried out a factor analysis of the
filling stations across the country by 2040 to reduce
interrelated components of the organization's management.
greenhouse gas emissions and develop energy independence. In
Development stage Import Substitution Internalization (1971-1990) Generation Stage Leading Stage (From
(1960-1970) (1990-2009) 2010)
Characteristic Enhance S.K.D. assembly, Local model early production, Generation of technology World leader - new
Localization C.K.D. Innovative local model with new engine design dominant design;
manufacturing.
SKD has been semi knocked
down, and CKD is completely
knocked down.
Source of Technology import, joint Technology import joint venture, In-house R&D, technology In-house and open
technology venture export market, in-house R&D import innovation
Product Assembly Mass production, national car Indigenous model Electric car, smart car
development
Management model Japanese and EU model Local model, F-F development Local model Local model
model
Market Domestic market orientation Export orientation Moved toward strengthening International market
export capacity
Result Gained assembly line experience Moved toward strengthening Sustainable upgradation as a Maintained leading
with mass production export capacity regional base position in global
production
Organization Leadership in the Automobile Industry The Open Transportation Journal, 2021, Volume 15 25
For the study, 16 experts (middle managers and project the implementation of a KMS in an organization;
managers) from Thai and Korean car companies were selected
● Communication capital has a direct and positive impact
using a simple random sample method.
on the dissemination and strengthening of knowledge in an
The interview process was arranged on the sample organization.
documents from each business process of the automotive
The authors proposed to develop a semantic model that
company. For example, a group of experts analyzed a set of
determines the various mutual influences of all these
competencies and factors, which have a strong impact on the
components on the final efficiency of the organizational
production process.
leadership of an automotive company. The next step was to use
The authors used the data obtained in the process of simple a standard functional model that makes it possible to assess the
sampling. These data were processed in order to identify their degree (weight) of the influence exerted by each parameter in
direct relationship; that is, they were checked simultaneously in the entire structure of relationships. (Fig. 3) shows the weights
the analysis of Structural Equation Modeling (SEM). In this of the predicted relationships in this model.
study, an SEM was used to collect, analyze, and interpret the
According to the indicators presented in Table 4, one can
data obtained. SEM allows one to use research results to
judge the productivity of the research model.
confirm or disprove a hypothesis. First, all system components
are modeled, and the model's reliability is then assessed. The The model fit indices allow us to assess the degree of the
evaluation uses special indicators that show the ratio of the chi- model's suitability for assessing interrelated options since the
square to the degree of freedom of the exponent. The degree of ratio of the chi-square to the freedom index is 2.67, which is
freedom must be determined by a value less than the acceptable less than the acceptable value of 3; also note that the root mean
level of 3, and the root-mean-square value of the approximate square value of the approximate error (0.039) is in the desired
error must be calculated. The possible value of the permissible range of allowed values, and the Pi (0.0005) indicator shows a
error should be less than 0.08; the Pi value must be less than result that is less than the acceptable range, which is 0.05. In
0.05. It is also necessary to adjust the compliance index during accordance with the results of this model, the authors revealed
the study, which should be greater than 0.9. a direct impact of knowledge capital on the effectiveness of
When assessing the significance and influence of organizational leadership actions since this influence has a
knowledge capital on the productivity of organizational value of 4.32, which exceeds the value of 1.96. The standard
leadership, the authors used a weighty factor model, and to model (Fig. 4) is then applied to the study to assess the
assess the weight of this influence, the researchers used a importance of the impact of organizational communication
standard organizational KM model. It is important to determine channels on the dissemination of knowledge in the
the limitations of the application of this model, which are organization.
expressed in the fact that the values should be determined at We further hypothesized how human capital, structural
the level of 0.95. At the same time, indicators that do not fall capital, and relationship capital (partnership) affect the quality
within the range from 1.96 to -1.96 are the most significant. of existence of organizational leadership (sub-hypothesis).
This means that the indicator falling within the range from 1.96 Thus, we first applied a meaningful model to determine the
to -1.96 has no weight and is not taken into account in further degree to which each element of knowledge capital influences
evaluation. Fig. (3) shows the impact of organizational management decisions. A standard model was then used that
components and their overall interactions on the production of identified how each aspect affects the quality of the
knowledge capital. organization's learning. We assessed each of the sub-
The main hypothesis is that different organizational hypotheses using separate approaches and using an
knowledge has a direct and positive impact on the formation of independent model. Since there are many scoring models, the
organizational leadership. The main hypothesis is supported by organizers set the limits of the study to select and apply only
the following secondary hypotheses: one scoring model (using factor analysis) [46]. The generalized
results of the corresponding analysis of the data for these
● Human capital has a significant impact on the formation
hypotheses are presented in Table 5. The data indicated in the
of the organizational capital of the organization;
Table 5 will help to further process the results and draw
● Structural capital has a significant and positive impact on appropriate final conclusions.
Capital Process
4.21 Human 5.79 2.19 Creating 5.93
Capital Process
0.55 Human 0.67 0.55 Creating 0.70
The results in Table 5 show an assessment of the development trajectories and strategic planning; all four
importance of various components of knowledge capital, which assessed parameters showed significance. In accordance with
have a direct and significant impact on the management the results obtained, it can be noted that improving the quality
decisions of the organization's management personnel. This of the organization's knowledge capital directly affects the
statement is confirmed by the fact that the value affecting quality of organizational decision-making. It is also obvious
knowledge capital is not in the range from -1.96 to 1.96. This that human capital plays a large role in the quality of decisions
substantiates the previously proposed hypothesis and confirms made by managers and managerial actions. In this regard, the
the proposed assumption that knowledge capital has a authors note that significant components of human capital,
significant and positive impact on the management decisions of influencing the process of formation and manifestation of
the organization's management. Moreover, the obtained values organizational leadership, consist of competence,
of the weight of the human capital indicator show that it has the communication, and creativity. Confirmation of the previously
stated hypothesis also justifies the formulation of important
greatest impact on improving the quality of management
tasks in improving the quality of human capital through various
decisions of the organization (0.89).
training programs in order to optimize the organizational
The general factorial model, reflecting the relationship of design and overall strategy. Several of the components of
variable components in the structural equation model, was structural capital have been shown to be effective in the
applied within the framework of existing organizational creation and development of organizational leadership:
Organization Leadership in the Automobile Industry The Open Transportation Journal, 2021, Volume 15 27
organizational culture, organizational structure, organizational industry were willing to transfer technology to South Korea
learning, and operating procedures [46, 47]. The results through foreign direct investment and foreign licensing. They
obtained do not contradict previously published studies in this had an attractive motivation. However, Korea later faced
area and agree with the results of previous authors. It is restrictions from advanced countries. Informal technical
necessary to note the positive influence of all elements of assistance was applied to reverse engineering that led to
knowledge capital on the further development of organizational innovation. South Korea was able to acquire foreign
leadership in the literature on KM, which is consistent with our technology. As a result, South Korea is now gaining new
conclusions. capacity through technology transfer from foreign sources.
However, Thailand's low absorptive capacity has allowed
6. DISCUSSION TNCs as a technology provider to take advantage of expanding
The effect of globalization and the latest transformation of their market through foreign direct investment and become
world economic relations enhance the role of scientific dependent on foreign direct investment. This is a major
research and emphasize the importance of creating and problem for the Thai auto industry.
introducing new technologies, as well as mechanisms and Korea has been able to develop an independent strategy in
methods of sustainable economic development, as the basis of the automotive industry. The transfer of knowledge through
world competitiveness for automotive organizations. One of foreign technology can increase the level of competence and
the main components of the economic development of such accelerate the process of training local staff through a strong
companies is the transfer of technologies and knowledge, their bargaining power. This is exemplified by Hyundai's
transformation, and their development. The degree of commitment to an independent strategy that delivers dynamic
participation of countries in this process largely determines the long-term learning and by Daewoo's joint venture showcasing
possibilities of their technical progress and competitiveness. In rapid initial learning, albeit not long-term.
the Asian region, an active interest in technology transfer today
is associated not only with the improvement of market relations CONCLUSION
in the economy but also with the leadership of countries in The conducted research proved the significant
world markets. For the development of the economy of each interdependence of knowledge factors and the organizational
country, it is necessary not only to increase the rate of transfer leadership actions of automobile companies. The significant
of unique and advanced technologies and knowledge, attracting impact on human capital of KMSs and the organizational
financial resources to enhance innovation, but also to work leadership formulation of automobile companies was also
proactively, creating economic forecasts. Moreover, the established.
introduction of innovations in enterprises should prevent future
global risks, which will allow for the creation and development Different management practices, knowledge and different
of an efficient infrastructure for the commercialization and elements of intellectual capital can benefit automobile
transfer of technologies (Heisig P., 2019) [47]. These days the companies and maximize value for their owners, but only if
global risk of COVID-19 requires new facilities and skills to they support and reinforce each other. The results show that
develop new knowledge strategies. This is the task for future Thai and Korean companies need to move in this direction if
discussion. they want to develop their technology and knowledge
cooperation successfully.
The property of innovation “affordability” characterizes
the ability to acquire or transfer this technology. It is associated As a result of the study, a general multivariate model
with whoever initiates the transfer, that is the receiving party, consisting of dependent and independent variables applicable
the developer, or another person. If the initiator is also a in a model of structural equations was formed. This model was
developer, then the availability of the technology is maximized, developed considering compatibility with the strategy and
since not only is documentation transferred, but also the organizational design of automotive companies, which showed
knowledge characteristic of this technology. In this case, it is certain limitations. All the measured indicators and their
possible to organize the training of personnel immediately and relationships turned out to be significant. The authors identified
at the lowest cost. On the contrary, for technologies that are not the following conclusions:
disclosed by the developer and are protected as a trade secret 1. The effect of the impact of human, organizational, and
(know-how), the availability is minimal. In this case, the communication capital on the effectiveness of organizational
transfer becomes almost impossible, and the development of a actions of the leadership is positive.
special strategy and motivational program is required (Hobohm
2. The organizational leadership of automotive companies
H.-C., 2014) [48].
is the interconnection between the processes of the socio-
The complexity of knowledge transfer is not clearly technological system, the efficiency of which mostly depends
defined today. In general terms, this is defined as the skill level on the strategic constraints and conditions of the external and
required to use and transfer technology. The more complex the internal environment. The availability of quality technological
technology, the higher the skill level required to use and and management infrastructures can help improve the quality
transfer it. The property of integrity in relation to industrial of organizational leadership in automotive companies.
technology characterizes the relationship of technology with
3. The central component of good organizational design
other technologies (Davenport T.H. et al., 2009) [49].
and company infrastructure is the intellectual capital of the
At one time, technology providers in the automotive organization.
28 The Open Transportation Journal, 2021, Volume 15 Shvetsova et al.
This study made it possible to assess and confirm the LIMITATIONS AND FUTURE RESEARCH
positive impact of the elements of knowledge assets on the ORIENTATIONS
process of improving human and structural capital, as well as
There are some limitations to this research:
their positive impact on improving the quality of decisions
made by management. At the same time, the further trajectory
of the development of management decisions and the This research is based on one case study, that is
improvement of organizational leadership through successful knowledge transfer between Korean and Thai
knowledge transfer is determined. companies.
This study is focused on KM and organizational
To explain the influence of structural capital on
leadership, but the role of technology transfer process
organizational leadership, the following causal relationships
has not been discussed.
(prerequisites) were identified: when organizational culture
Only automobile industries from the two countries are
supports the formation, learning, development, and exchange
discussed.
of knowledge, it contributes to the further positive
The period of the survey is limited to two years.
transformation of knowledge and its transformation into key
competencies. In the presence of soft control in the For future research, it is necessary to discuss three typical
organization, adequate organizational design, and an excellent technological learning patterns in the automobile industry.
communication environment in which every employee of the Organizational design incorporates various principled decisions
automotive organization has access to existing information and about the separation of work in the company and the
knowledge, a synergistic effect of the production and
coordination methods between different departments. Thus, the
dissemination of key knowledge is triggered, which leads to a
problem is the protection of intellectual assets during the
high level of competitiveness and technological success of the
knowledge transferring process. By choosing specific solutions
company. However, data and knowledge protection between
in this area, such as involving employees in decision-making or
independent companies is a problem. Therefore, we suggest
creating cross-functional expert groups, a company can
that improving and reinforcing intangible capital can prepare
increase the efficiency of its knowledge resources. The
the right KM structure to promote an organizational leadership
company's unique knowledge is a source of competitive
system’s effectiveness in an automobile organization.
advantage, so the protection of such strategically significant
Through a case study and Cronbach test, we found that knowledge is an important task of KM.
human capital plays a large role in the quality of decisions
Future researchers can consider quantitative and qualitative
made by managers and managerial actions. In this regard,
significant components of human capital, influencing the algorithms of the knowledge transferring process for effective
process of formation and the manifestation of organizational cooperative strategies between independent companies. The
leadership, consist of competence, communication, and significant role of the promotion of technological innovation
creativity. capabilities can be identified, and the intellectual property right
of the enterprises should be recognized as the main criteria,
Thailand has chosen a strategy of organizing joint ventures making a comparison of the three kinds of business learning
with foreign TNCs. Local offices are dependent on the head patterns, and aiming to explore more effective organizational
office. As a result, Thailand is exploring technology through leadership models.
the strategy of the parent firm and becoming dependent on
foreign direct investment. CONSENT FOR PUBLICATION
The strong and centralized Korean government exemplifies Not applicable.
an effective industrial policy. In addition, the establishment of
a science and technology information center in South Korea AVAILABILITY OF DATA AND MATERIALS
has created a network of connections within the industry,
leading to the diffusion of technology through effective The data and materials used to support the findings of this
communication. In Thailand, the role of government and study are available from the corresponding author [O.A.S]
technology learning support in organizations remains upon reasonable request.
dependent on foreign direct investment.
FUNDING
Korean firms acquire and master foreign technology
mainly through simulation design and move towards direct This research received research funding from Korea
investment in R&D. For example, Hyundai increased its University of Technology and Education (KOREATECH)
investment in R&D from 4.4% of sales in 1994 to 7% in 1995, under grant no. #2020-0108.
and this investment continued to increase afterwards. In
CONFLICT OF INTERESTS
Thailand, the company's research and development activities
are controlled by a joint venture to develop more efficient The authors declare no conflict of interest, financial or
functions for individual products [50]. otherwise.
These results can be used to make managerial decisions in
ACKNOWLEDGEMENTS
the process of forming an automobile industry competitive
strategy. Declared none.
Organization Leadership in the Automobile Industry The Open Transportation Journal, 2021, Volume 15 29