The role of knowledge-oriented leadership in knowledge management practices and innovation

•This study explores relationships between knowledge management practices, organizational leadership and innovation.•We examine the impact of a specific type of leadership, knowledge-based leadership, in a firm's innovation performance.•The study tests a model of relationships through the Partial Least Squares (PLS) statistical technique in a sample of technological firms from Spain.•We find that knowledge management practices mediate the effect of knowledge-oriented leadership on innovation performance.•Innovation performance in knowledge based firms depends on both exploration and exploitation KM practices.

This study aims to examine the role of a specific type of organizational leadership – knowledge-oriented leadership – in knowledge management (KM) initiatives that seek to achieve innovation. An analysis of the knowledge-based view of the firm gives rise to several hypotheses, with structural equation modeling (SEM) analysis through partial least squares (PLS) providing the methodology to test these hypotheses. This approach yields results for a sample of empirical data from technology industries. This paper presents empirical evidence of the mediating effect of KM practices in the relationship between knowledge-oriented leadership and innovation performance. In line with previous literature, results show that, although KM practices themselves are important for innovation purposes, the existence of this kind of leadership encourages the development and use of KM exploration (i.e., creation) and exploitation (i.e., storage, transfer, and application) practices. A major implication is that, as a result of this development and the use of KM practices, the firm is able to improve its performance in product innovation.