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DOI 10.1108/JKM-11-2019-0624 VOL. 24 NO. 9 2020, pp. 2079-2106, © Emerald Publishing Limited, ISSN 1367-3270 j JOURNAL OF KNOWLEDGE MANAGEMENT j PAGE 2079
identified knowledge as an important tool necessary for organizational success (Ooi, 2014).
Knowledge is being acquired, shared and used for gaining advantages (Darroch, 2005) in
raising customer satisfaction and obtaining competitiveness (Kianto et al., 2014; Mothe
et al., 2018). KMP enables organizations to respond to changes (Cillo et al., 2019) and
improves the sustainability of operations (Abbas, 2020) and competitive edge (Del-Giudice
et al., 2017), which in turn bring shareholders’ reliability and customers’ trust (Albort-Morant
et al., 2018).
KMP has been recognized as a significant component in designing and developing new
services and products, managing the operational process in the current business world
(Mardani et al., 2018; Qasrawi et al., 2017). For this reason, organizations seek to espouse
new and effective knowledge management (KM) strategies to achieve sustainable
objectives (Chen et al., 2009). Conferring to Tseng (2014), modern economies are built
using innovative ideas from human intellectual capital, which are contributing to
sustainability and profitability. KMP assists organizations in building up the capabilities
necessary for green innovation (GI) (Schneider, 2015), which further enhances CSP
(Abbas, 2020). GI derived from KMP has contributed to the development of environment-
friendly products (Li et al., 2018). From this, it is evident that KMP can play a fundamental
role in attaining CSP. Knowledge resources and capabilities are the building blocks for
firms’ abilities to innovate sustainably (Mills and Smith, 2011; Shahzad et al., 2019). Within
the firms’ capability framework, OA is increasingly appealed as the organizational ability to
deal with uncertain environmental changes by sensing and responding rapidly to exterior
changes (Lin et al., 2006; Muduli, 2017). For acquiring such agility, organizations must hold
adequate knowledge resources and sufficient capabilities to process available information
and make timely decisions (Kale et al., 2019).
According to Global Innovation Index (GII) statistics, Pakistan is one of the least innovative
nations, and its ranking was 119 in 2017 and 113 in 2018 out of a total of 126 countries
(Global Innovation Index, 2018), although its population is 207 million with 14% GDP share
in the manufacturing sector (Economic Survey of Pakistan, 2017). As per GII, some of the
factors that hinder innovation and growth are institutional factors, human capital factors,
infrastructure and technology factors, market and business factors and, the most valuable
among all of these, the knowledge and creativity factors. As per Pakistan Council for
Science and Technology vision 2025, value addition through innovation and knowledge is
the most critical national development plan for the following decade. Ministry of Science
and Technology of Pakistan has decided to conduct the maiden Industrial National
Innovation Survey (Abrar Hamza, 2018). The thought behind this investigation is to bring
innovations that upgrade the development and sustainability of industrial products in the
global market (Secretary, 2018). These facts motivate the authors to study the KMP for CSP
with special consideration of the Pakistani manufacturing sector routinely with staunch
proposals for policy implications.
The previous researchers have placed KMP under the core consideration in the studies of
organizational performance and knowledge-based innovation (Darroch, 2005; Shujahat
et al., 2017). Relatively a very few studies have assessed the association between the KMP
and CSP despite having a lot of talk in the industrial circles (Gholami et al., 2013; Lim et al.,
2017; Tseng, 2014; Zwain et al., 2012). Recent research has acknowledged a positive
relationship between knowledge absorptive capacity and CSP (Shahzad et al., 2019).
Shahzad et al. (2020) identified that the environmental dimension of sustainable
development (SD) has a positive influence on GI. Abbas and Sagsan (2019) stressed the
positive role of KM in the accomplishment of corporate SD; there is, however, no work
available to establish the impact of OA and GI on the relationship between KMP and CSP.
Besides, Davenport et al. (2019) emphasized the importance of extending the limited
literature on KMP, GI and SD. Thus, the problems mentioned above and the gap in literature
a source of competitiveness for organizations and individuals being hard to imitate. Further,
KMP is a process for acquisition, dissemination and efficacious use of corporate knowledge
resources (Darroch, 2005). It is one of the core strategies and antecedents for organizations
to boost GI and also proficient at exploring new directions for sustainable performance (Lim
et al., 2017). To improve innovation and performance, firms could use already acquired
knowledge (Kianto et al., 2017; Kuo, 2011). The connection between KMP and GI emerges
when the top management invests in eco-friendly and green resources for development in
innovation using the knowledge and competencies of employees (Pérez-Luño et al., 2019).
In this context, organizational learning emphasizes joining corporate strategies with KM
strategies so that GI objectives can be achieved (Buenechea-Elberdin, 2017; Davenport
et al., 2019). The latest research highlighted that KA is primarily essential for achieving CSP
(Shahzad et al., 2019). Lin (2007) highlighted that sharing of knowledge improves
organizational knowledge resources, which is likely to engender novel ideas, and
consequently influence innovative organizational capabilities. Further, tacit knowledge
sharing also has a significant influence on innovative capabilities (Ganguly et al., 2019).
Wong (2013) also suggested that sharing of knowledge significantly impacts GI and
innovation success. Madhoushi et al. (2011) endorsed that KAP permits skills and
knowledge of an enterprise to be converted into product and process development.
Effective KAP enables the firms to produce sustainable products through innovative
production processing technologies. Further recent studies also identified that KM
practices positively impact GI (Abbas and Sagsan, 2019). From the literature, it is quite
evident researchers are paying more attention on how KM helps to attain GI. Therefore, the
following hypothesis is proposed:
H1. Knowledge management process (KMP) has a positive and significant effect on
organizational green innovation (GI).
3.1.1 Knowledge acquisition. The term acquisition implies the aptitude to recognize and
attain new knowledge, which is crucial for effective organizational processes (Attia and
Salama, 2018). Primarily, employees acquire new knowledge from internal corporate
sources such as colleagues and team members (Qasrawi et al., 2017). KA is obtaining or
H2. Green innovation (GI) has a positive and significant effect on corporate sustainable
performance (CSP).
3.2.1 Environment sustainability. Different organizations have a diverse stimulus for
embracing GI. Environment sustainability and GI both are a relatively new topic; research
on these emerging concepts is also escalating (Albort-Morant et al., 2018). The environment
sustainability means changes in production technologies that intend to lessen the adverse
impacts on the natural environment (Galdeano-Go mez et al., 2013). It is the leading strategy
4.2 Measures
The authors used a seven-point Likert scale ranging from 7 to 1 “strongly agree” to “strongly
disagree” to rate all the used constructs. This study has adopted the constructs from
available literature with some minor modifications to ensure contextual consistency. The
final questionnaire was checked by two experts to ensure consistency. A pilot study was
conducted to ensure the content validity from 52 organizations’ sample. Some small
adjustments were made in the survey to ensure validity and reliability; anyway, the complete
results established the formal data collection. KMP was measured using the 16 items from
Darroch (2003). Darroch (2003) distributed these items into three dimensions of KMP, i.e.
KA, KD and KAP. Where we measured the KA using six items from the Darroch (2003), “Our
organization is quick to detect change in customer preference and their adoption.”
Similarly, KD was measured by using the five items from Darroch (2003), “Our organization
actively arranges coaching and training sessions for knowledge transfer.” Additionally, KAP
was measured by using the five measures from Darroch (2003), “Our organization responds
quickly to changing technology.” CSP was measured by three dimensions: environment,
economic and social sustainability. It was adopted from the Bansal (2005) using various
items of the constructs. For instance, ENVS was measured by using the six items from
Bansal (2005), “Our organization reduced likelihood of environmental accidents through
process improvements.” Similarly, ECOS was measured by using the five items from Bansal
(2005), “Our organization created spin-off technologies that could be profitably applied to
other areas of the business.” In addition, SOCS was measured by using the four items from
Bansal (2005), “Our organization communicated the firm’s environmental impacts and risks
to the public on regular basis.” Furthermore, GI was measured by using the six items from
the Song and Yu (2018); for instance, “Our organization uses the fewest amounts of
materials to comprise the product for conducting the product development or design.”
Finally, OA was measured by using the six items adopted from Cegarra-
5. Data analysis
We analyzed the data by using IBM SPSS version 24 and SmartPLS version 3.2.8, using
partial least squares structural equation modeling (PLS-SEM). This study used PLS-SEM
because of the following reasons. This technique is most recommended when the focus of
the research is to predict and explore the dependent variables to explain the maximum
variance. So, PLS-SEM is the best prediction-oriented approach (Rolda n and Sa nchez-
Franco, 2012). It can also handle both the measurement (outer) and structural (inner)
models simultaneously. Further, it is an appropriate approach for the analysis of complex
path models (Hair et al., 2016). Finally, the PLS-SEM can also cater to small sample size
and provide more accurate results. Hence, PLS-SEM seems to be an appropriate approach
for this study.
OA 0.783
ECOS 0.131 0.816
ENVS 0.180 0.673 0.834
GI 0.198 0.437 0.439 0.826
KA 0.064 0.444 0.405 0.351 0.833
KAP 0.088 0.422 0.407 0.576 0.331 0.844
KD 0.029 0.427 0.443 0.363 0.464 0.348 0.814
SOCS 0.099 0.401 0.490 0.396 0.216 0.371 0.261 0.870
Notes: OA = organizational agility; ECOS = economic sustainability; ENVS = environment
sustainability; SOCS = social sustainability; GI = green innovation; KA = knowledge acquisition; KD =
knowledge dissemination; KAP = knowledge application
OA
ECOS 0.152
ENVS 0.198 0.749
GI 0.221 0.484 0.472
KA 0.074 0.491 0.436 0.377
KAP 0.102 0.469 0.436 0.628 0.353
KD 0.066 0.479 0.483 0.398 0.499 0.382
SOCS 0.111 0.441 0.528 0.427 0.224 0.403 0.281
Notes: OA = organizational agility; ECOS = economic sustainability; ENVS = environment
sustainability; SOCS = social sustainability; GI = green innovation; KA = knowledge acquisition; KD =
knowledge dissemination; KAP = knowledge application
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Author affiliations
Mohsin Shahzad, Ying Qu, and Abaid Ullah Zafar are all based at the School of Economics
and Management, Dalian University of Technology, Dalian, China.
Saif Ur Rehman is based at the Department of Management Sciences, Lahore Garrison
University, Lahore, Pakistan.
Tahir Islam is based at the School of Economics and Management, Tongji University,
Shanghai, China and Faculty of Business Administration and Social Sciences, Mohammad
Ali Jinnah University, Karachi, Pakistan.
Corresponding author
Ying Qu can be contacted at: quying@dlut.edu.cn
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