Knowledge management and innovation performance in a high-tech SMEs industry

This article examines how knowledge management (KM) affects innovation performance within biotechnology firms. This is an industry in which small- and medium-sized biotech enterprises live together with the biotech divisions of large pharmaceutical firms. We conceptualize KM as a set of practices and dynamic capabilities, and hypothesize that KM dynamic capabilities act as a mediating variable between KM practices and innovation performance. We use structural equation modelling to test the hypotheses on a data set from the biotechnology industry. The results support our conceptualization and demonstrate its utility in explaining differences in innovation performance across firms. Findings …