Abstract

Firm innovation more and more relies on how well companies control their knowledge resources because information is a key asset in the present day. Companies are thus driven to always grow and use knowledge to keep a competitive advantage by innovation. This study investigates the separate impacts on company innovation of several knowledge management characteristics and offers an integrated approach including both linear and non-linear dynamics—an area that has been underexplored. Using a logical and statistical approach, 437 banking industry employees completed an online survey to provide data. Using Structural Equation Modelling (SEM), one might evaluate quadratic correlations between variables. The study shows that whereas knowledge application follows a U-shaped path, knowledge production shows an inverted U-shaped association with innovative results. On the other hand, information sharing, application, and protection keep straight relationships with innovation; knowledge sharing turns out to be the most important engine. Given that their impacts are not always linear, our results imply that an undue emphasis on particular knowledge management techniques might be harmful. Especially in knowledge-intensive industries, the research offers insightful direction for managers by stressing the importance of deliberate monitoring and strategic change of knowledge management techniques to optimize innovation performance.