Testifying the Mediating Role of Innovation in Knowledge Management and Organisational Performance Relationship

Abstract

The purpose of this paper is to assess the synergistic impact of knowledge management (KM) on organisational performance (OP). Further, this paper testified the mediating role of innovation in the relationship between knowledge management and organisational performance. Primary data has been collected through self-modified and well-structured questionnaires, which were distributed among employees working in the general insurance sector of the Jammu District of J&K, by using the census method. Secondary sources investigated were books, newspapers, and relevant journals. Extensive review of literature has been conducted to frame the dimensions of the construct, namely knowledge management, innovation, and organisational performance. Questionnaires have been duly purified and validated before data analysis. Structural equation modelling technique has been used to assess the impact of knowledge management on organisational performance. The results revealed a significant and positive impact of KM on OP. Furthermore, the Baron and Kenny approach has been used to testify the mediating role of innovation, and the results found a partial mediation, which signifies the existence of a direct relationship between KM and OP, as well as an indirect relationship through innovation. The respondents might have given the information regarding knowledge management, innovation, and organisational performance on the basis of their own perception. In order to implement an effective knowledge management system, management should create a culture conducive to learning and knowledge.