Knowledge Management as a Source of Innovation and Competitive Advantage for SMEs in Peripheral Regions

Abstract

The advent of knowledge management has offered new opportunities for small and medium-sized enterprises (SMEs) in peripheral regions to leverage knowledge as a source of competitive advantage. However, few studies at firm level examine the role of knowledge management in helping to improve innovation and competitiveness in SMEs in such regions. This paper explores how SMEs in peripheral regions can use knowledge management concepts and practices of knowledge acquisition and assimilation to achieve higher levels of innovation implementation. Survey findings indicate that more innovative firms are more likely to acquire or source external knowledge through various methods, and are more likely to have higher levels of absorptive capacity. Overall, the authors conclude that SMEs in peripheral regions can use knowledge acquisition and assimilation as antecedents to innovation to help overcome innate tangible resource limitations.