Knowledge management in offshoring innovation by SMEs: role of internal knowledge creation capability, absorptive capacity and formal knowledge-sharing routines

Abstract

Purpose In spite of the increased attention on knowledge management processes as important variables for firms to generate performance benefits within supply chain literature, little is known about how these variables could impact offshoring innovation (OI) relationships held by small and medium-sized enterprises (SMEs). Considering their growing importance, this study aims to investigate the interplay between the internal knowledge creation capability, absorptive capacity and formal knowledge routines in attaining OI performance benefits for SMEs. Design/methodology/approach Grounded in the knowledge-based view theory, this study forwards various hypotheses between the variables of interests. The authors test the hypotheses using survey data collected from 200 European SMEs that engage in offshore supplier relationships. Findings The findings suggest that internal knowledge creation capability is positively associated to absorptive capacity. Not only is absorptive capacity positively associated to OI performance outcomes but it also positively mediates the effect of internal knowledge creation capability on OI performance. Additionally, formal knowledge-sharing routines negatively moderate the relationship between absorptive capacity and OI performance. Originality/value This study contributes to the supply chain as well as SMEs innovation literature by empirically showing that through enhanced internal knowledge creation capability, absorptive capacity goes beyond merely accessing and assimilating the supplier’s knowledge to achieve innovation gains. The results suggest that to succeed in gaining knowledge and subsequent performance benefits within OI, it is essential for SMEs to create and retain knowledge internally.

Knowledge management in SMEs: a follow-up literature review

“…Based on the mediation-moderation analysis, Khraishi et al (2022) demonstrated that absorptive capacity and internal knowledge creation capacity influence offshoring innovation performance, while absorptive capacity mediates the relationship between internal knowledge creation and offshoring innovation performance. Further, their findings indicate that formal knowledge sharing routines moderate the relationship between absorptive capacity and offshoring innovation performance.…”

“…, Alegre et al (2013), Audretsch and Belitski (2021), Azyabi (2018), Bloem and Salimi (2022), Byukusenge and Munene (2017) Hassan and Raziq (2019), Kmieciak and Michna (2018), Khraishi et al (2022), Lee and Wong (2015a, b), Liu and Abdalla (2013), Obeso et al (2020), Permatasari et al (2022), Santoro et al (2019), Schoenherr et al (2014), Scuotto et al (2020, Ul Zia (2020), Wang and Yang (2016), Wibowo and Grandhi (2017), Yusr et al (2021)…”

Bright and dark side of knowledge management practices in firms using information systems: examining different moderating impacts

“…Innovativeness is considered a process that exploits creative ideas for commercial gain and the benefit of the firm (Chatterjee, 2021;Khraishi et al, 2022). Therefore, creativity and innovation are found to work in tandem (Escrib a-Esteve and Montoro-S anchez, 2012).…”

How absorptive capacity influences project performance

“…In recent decades, the literature has analyzed the AC mediation effect on firm performance and found a significant positive relationship between the variables tested. For instance, conceptual ambiguity of AC (Song et al, 2018), innovation and mass customization (Liu et al, 2018), internal cost management, information systems integration, AC and interorganizational cost management (Fayard et al, 2012), knowledge management in offshoring innovation by small and medium-sized enterprises (SMEs) (Khraishi et al, 2022), among others.…”

“…, 2018), internal cost management, information systems integration, AC and interorganizational cost management (Fayard et al. , 2012), knowledge management in offshoring innovation by small and medium-sized enterprises (SMEs) (Khraishi et al. , 2022), among others.…”