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Knowledge management, innovation and firm performance

Jenny Darroch (Assistant Professor of Marketing at the Peter Drucker and Masatoshi Ito Graduate School of Management at Claremont Graduate University. Her current research focuses on the interface between marketing and entrepreneurship, in particular the comparison between market driven and driving markets firm behaviour. She has also published extensively on the role of knowledge management within organizations, in particular as an antecedent. Prior to joining Claremont Graduate University, She was the Director of Entrepreneurship and Senior Lecturer in Marketing at the University of Otago in New Zealand. E‐mail:

Journal of Knowledge Management

ISSN: 1367-3270

Article publication date: 1 June 2005




To provide important empirical evidence to support the role of knowledge management within firms.


Data were collected using a mail survey sent to CEOs representing firms with 50 or more employees from a cross‐section of industries. A total of 1,743 surveys were mailed out and 443 were returned and usable (27.8 percent response rate). The sample was checked for response and non‐response bias. Hypotheses were tested using structural equation modelling.


This paper presents knowledge management as a coordinating mechanism. Empirical evidence supports the view that a firm with a knowledge management capability will use resources more efficiently and so will be more innovative and perform better.

Research limitations/implications

The sample slightly over‐represented larger firms. Data were also collected in New Zealand. As with most studies, it is important to replicate this study in different contexts.

Practical implications

Knowledge management is embraced in many organizations and requires a business case to justify expenditure on programs to implement knowledge management behaviours and practices or hardware and software solutions. This paper provides support for the importance of knowledge management to enhance innovation and performance.


This paper is one of the first to find empirical support for the role of knowledge management within firms. Further, the positioning of knowledge management as a coordinating mechanism is also an important contribution to our thinking on this topic.



Darroch, J. (2005), "Knowledge management, innovation and firm performance", Journal of Knowledge Management, Vol. 9 No. 3, pp. 101-115.



Emerald Group Publishing Limited

Copyright © 2005, Emerald Group Publishing Limited

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