Does Market Orientation Mediate between Knowledge Management Orientation and Business Performance?

Abstract

The objective of the study is to test the relationship between knowledge management orientation (KMO) and business performance (BP). KMO is a higher-order construct consisting of three second-order constructs: learning orientation (LO), knowledge sharing orientation (KSO), and information technology orientation (ITO). The paper explores the mediating role of market orientation (MO) in the relationship between KMO and BP. In this firm-level study, the personal survey was administered to key informants in 400 listed firms (from manufacturing and service sector) from North Indian States and Union Territories [including Punjab, Haryana, Himachal Pradesh, Jammu and Kashmir, Uttaranchal, Uttar Pradesh, Rajasthan, Chandigarh and National Capital Region (NCR)]. Two respondents each from these 400 firms were approached. The study found that KMO positively affects BP. MO does not mediate the relationship between KMO and BP. Rather, KMO fully mediates the relationship between MO and BP. The study provides evidence in support of KMO as a mediator between MO and BP. KMO of the firm provides a dynamic capability for realizing the benefits of a firm’s MO. The study contributes to the knowledge management literature by empirically validating the KMO, MO and BP constructs.