Passive but defiant: the role of innovative capabilities in knowledge management and corporate entrepreneurship

Abstract

PurposeThis paper aims to examine the role of organizational innovative capabilities (OIC) on the relationship between knowledge sharing (KS), corporate entrepreneurship (CE) and firm performance (FP). Specifically, this study uses the knowledge-based view to develop a model that examines the mentioned relationship.Design/methodology/approachUsing survey data from 520 participants across 75 service sector companies in Thailand, measurement and structure models are tested through structural equation modeling to quantify the impact between constructs.FindingsThis study shows that KS and CE positively affect OIC and FP. A positive relationship is also found between KS and CE. The mediating impact of OIC strengthens the relationship between KS and CE on FP.Research limitations/implicationsLike all research using survey methods, the research is prone to respondent biases and generalizability. However, this paper has put the best effort to minimize such effects by rigorous methodological testing to avoid such biases.Practical implicationsThe findings of this study suggest that to improve organizational learning and knowledge-based performance, commitment and understanding of the employees in the entire organization is crucial. KS significantly contributes to developing innovative abilities because of its characteristics of providing firm-specific and socially complex advantages. The way a firm transforms and exploits its knowledge may ascertain its level of innovativeness, such as coming up with certain problem-solving procedures and new product development according to the rapid change in the market demand. However, organizations may only instigate to effectively organize knowledge when their employees are ready to share knowledge. Continuous KS boosts entrepreneurial practices and contributes innovativeness across individuals, groups, units or the entire organization.Originality/valueThe relationship between CE, organization innovative capabilities and FP in the presence of KS is rarely discussed in both theoretical and empirical literature. This study contributes to the literature by arguing that apart from the direct impact of KS on FP, KS can lead the firms toward generating important competitive advantage by forming innovative capabilities that can significantly influence FP.