Knowledge management systems, absorptive capacity, and innovation success

Innovation is considered a major driving force for the prosperity of firms and entire economies. Research suggests that a firm’s capacity to acquire and utilize relevant knowledge from internal and external sources, i.e. its absorptive capacity (ACAP), is decisive for innovation success. But what is the role of Knowledge Management Systems (KMS) for a firm’s ACAP and innovativeness? Surprisingly, despite lots of mature research on both, ACAP and KMS, there is a gap linking the two. This paper hence asks: What is the effect of knowledge management systems usage on absorptive capacity and innovation success? Responding to recent findings in the management and organizational sciences we develop a theoretical model that links the availability and usage of KMS with a firm’s ACAP and its organizational knowledge to explain innovation success. An empirical evaluation using data from 224 manufacturing firms shows that a firm’s KMS strongly contributes to its ACAP and catalyzes the innovation process. The results suggest that organizational knowledge is important for innovation success and that successful KMS work through enhancing particular facets of ACAP.