The Mediating Role of Knowledge Management in the Relationship Between Intellectual Capital and Innovation Performance of Banks in A Developing Country Perspective

Prof. Yitbarek Takele Bayiley; Abel Aragaw Zeleke

The study investigated the direct and indirect effects of Intellectual Capital (IC) on Innovation Performance (IP) using Knowledge Management (KM) as mediating variable.

Design/methodology/approach: EFA and SEM were employed to identify and validate the battery of factor structures.

Findings: IC directly influenced KM while KM directly affected innovations. Hypothesized direct effects of Social Capital (SC) and Customer Capital (CC) on IP were partially supported, while the indirect impact of Human Capital (HC) on innovations was not supported. Inexplicably, the relationship between HC and Product Innovation (PDI) was negative though HC directly affected PDI, challenging the existing theoretical underpinnings.

Practical Implications: The study concludes KM has a mixed (full, partial, competitive) mediation effect in the relationship between IC and innovation performance.

Originality/value: The paper contributes to the limited empirical literature examining the relationship between IC, KM & IP in the sub-Saharan African banking sector.

[ FULL TEXT PDF 1-15 ] DOI: 10.30566/ijo-bs/2022.03.82

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