The effect of knowledge management capacity on firm performance through sequential mediations of strategic HRM, administrative and technical innovations

Abstract

Purpose This study aims to explore the relationship between knowledge management (KM) and firm performance through mediating effects of strategic human resource management (HRM) and organizational innovations. Design/methodology/approach Usable responses from 638 employees belonging to 230 organizations operating in India were collected via questionnaires. To determine the hypothesized relationships between the study variables, namely, KM capacity, strategic HRM, administrative innovation, technical innovation and firm performance, bootstrapping method via PROCESS was put into use. Findings The findings strengthen the notion that effective KM in firms leads to better innovation capabilities and higher firm performance. Further, the study reveals that the effects of KM capacity on firm performance go through a relationship chain (serial mediation) consisting of strategic HRM, administrative innovation and technical innovation. Practical implications The results undeniably infer that the effective management of knowledge is critical for leveraging innovations and other performance indicators in organizations. More specifically, it does not only result in enhanced firm performance but also in proper utilization of strategic HR practices for the benefits of employees, with a boost in administrative and technical innovations in organizations. Originality/value By confirming several mediation paths through strategic HRM, administrative and technical innovations, this study offers some noteworthy insights in expounding the relationship between KM and firm performance.