Knowledge Management - Relationship between Innovation and Performance

Our aim is to shed light on the consequences of knowledge management (KM) strategies on firm’s innovation and corporate performance. Organizations are not aware of the real implications that KM may have. Based on an empirical study consisted of 168 organizations and structural equations modeling, results show that both KM strategies (codification and personalization) impacts on innovation and organizational performance directly and indirectly (through an increase on innovation capability). Also, findings demonstrate a different effect of KM strategies on diverse dimensions of organizational performance .
Now, enterprises can learn about the positive impact of KM and KM strategy on innovation and performance. Specifically, companies know that with a clear KM strategy they can be more innovative, achieve better financial results, improve processes and develop human resources’ capabilities. And, in turn, those benefits foster the link innovation-performance .These conclusions may help academics and managers in designing KM strategic programs in order to achieve higher innovation, effectiveness, efficiency and profitability.