Christian Wiradendi Wolor, Faerozh Madli, Mahmoud Ali Rababah, Hasan Mukhibad, Wong Chee Hoo
Micro, small, and medium enterprises (MSMEs) play a crucial part in augmenting a nation’s gross domestic product (GDP). Nevertheless, MSMEs continue to encounter obstacles, particularly in utilizing knowledge management to enhance their business performance. Hence, this study aims to investigate the correlation between the utilization of knowledge management for innovation and its influence on the performance of MSMEs, addressing an unexplored area of research. Data was collected through a field survey with a sample of 371 respondents from MSME business actors in Indonesia. The results of this research showed that the implementation of knowledge management does not directly affect the performance of small and medium-sized enterprises (SMEs). However, knowledge management positively influences innovation, which in turn positively affects the performance of these enterprises. The study makes a theoretical addition to the field of science and practice for MSMEs. The theoretical importance of this research lies in understanding that knowledge management alone does not lead to improved performance of SMEs without innovation. This underscores the importance of knowledge management in fostering innovation, which is essential for enhancing business performance amid rapid technological advancements. Practically, the findings suggest that SMEs should begin by identifying critical types of knowledge necessary for their operations and innovations, storing this knowledge systematically in accessible databases. Copyright © 2024 by the author(s).
Faculty of Economics, State University of Jakarta, Jakarta, 13220, Indonesia; Faculty of Business, Economics and Accountancy, University of Malaysia Sabah, Kota Kinabalu, 88400, Malaysia; Jadara Research Center, Jadara University, Irbid, 21110, Jordan; Faculty of Economics and Business, Semarang State University, Central Java, 50229, Indonesia; Faculty of Business and Communication, INTI International University, Nilai, 71800, Malaysia
