Journal of Intellectual Capital

Emerald Article: Knowledge sharing and innovation performance: A

comparison between high-tech and low-tech companies
Josune Sáenz, Nekane Aramburu, Olga Rivera

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JIC
10,1 Knowledge sharing and
innovation performance
A comparison between high-tech and low-tech
22 companies
Josune Sáenz
ESTE School of Management & Orkestra – The Institute of Kompetitiveness
and Development (IK þ D), University of Deusto, San Sebastián, Spain
Nekane Aramburu
ESTE School of Management, University of Deusto, San Sebastián, Spain, and
Olga Rivera
ESTE School of Management & Orkestra – The Institute of Kompetitiveness
and Development (IK þ D), University of Deusto, San Sebastián, Spain

Abstract
Purpose – The aim of this paper is to test empirically the degree of influence of different
knowledge-sharing mechanisms on the innovation capability of firms, as well as to analyse the degree
of relevance of each innovation capability dimension to value creation. Additionally, the role of
technology intensity as a moderator variable of the aforementioned relationships is examined.
Design/methodology/approach – An ad hoc questionnaire was designed and addressed to the
CEOs of the companies making up the target population of the research (Spanish manufacturing firms
with more than 50 employees and R&D activities). Structural equation modeling (SEM) based on
partial least squares (PLS) was then applied in order to test the main hypotheses of the research.
Findings – The results obtained show that knowledge sharing is a key issue in order to enhance the
innovation capability of firms. Nevertheless, depending on the innovation capability dimension being
considered and on the technology intensity of the firm, the type of knowledge sharing which appears
to be more fruitful varies. On the other hand, technology intensity also moderates the degree of
relevance of each innovation capability in value creation.
Originality/value – The main contribution of the paper is to provide empirical evidence about the
impact of knowledge sharing on innovation. Moreover, it reveals what the most effective
knowledge-sharing mechanisms are for this purpose, and provides companies with a basic framework
in order to shape their knowledge management strategies.
Keywords Knowledge management, Knowledge sharing, Manufacturing industries, Spain
Paper type Research paper

Journal of Intellectual Capital
Vol. 10 No. 1, 2009
pp. 22-36
q Emerald Group Publishing Limited
1469-1930
DOI 10.1108/14691930910922879
1. Introduction
In today’s competitive landscape, innovation is a must. Superior innovation provides
companies with opportunities to grow faster, better, and smarter than their
competitors – and ultimately, to influence the direction of their industry (Davila et al.,
2006).
Since the seminal works by Nonaka (1991) and Nonaka and Takeuchi (1995), the
concept of innovation has been closely related to that of “knowledge creation”. Along
these lines, it is generally assumed that the process of innovation consists of an
ongoing pursuit of harnessing new and unique knowledge (Subramaniam and Youndt, Knowledge
2005). sharing and
In particular, knowledge creation involves a continuous process through which one
overcomes the individual boundaries and constraints imposed by information and past innovation
learning by acquiring a new context, a new view of the world, and new knowledge. By
interacting and sharing tacit and explicit knowledge with others, the individual
enhances the capacity to define a situation or problem, and apply his or her knowledge 23
so as to act and specifically solve the problem (Nonaka et al., 2006). In the case of
organizational knowledge creation, this means making available and amplifying the
knowledge created by individuals as well as crystallizing and connecting it with the
organization’s knowledge system (Nonaka and Takeuchi, 1995; Nonaka et al., 2006).
Therefore, knowledge sharing and diffusion are both essential in order to create new
knowledge and produce innovation (Dalkir, 2005).
On the other hand, innovation is a dynamic capability (i.e. a capability which allows
the company to create, extend or modify its resource base; Helfat et al., 2007) with
multiple dimensions. The first is that of ideation (Davila et al., 2006), which involves
new idea generation and selection. Selected new ideas should then be put into practice
(Van de Ven and Angle, 2000). This brings us to the execution phase. In this phase,
managing innovation projects effectively should be combined with the ability to fit
them into budgeted costs and deadlines (i.e. timeliness and cost efficiency). Finally, all
the aforementioned dimensions should lead to value creation.
Considering this, the aim of this paper is to test empirically the degree of influence
of different knowledge sharing mechanisms on the innovation capability of firms, as
well as to analyze the degree of relevance of each innovation capability dimension in
value creation. Additionally, the role of technology intensity as a moderator variable of
the aforementioned relationships is examined.

2. Research hypotheses
In order to make knowledge sharing happen within and among organizations, several
researchers have focused on the study of different ad hoc mechanisms and initiatives
which could act as facilitators. Many of these mechanisms take advantage of
information and communication technologies (i.e. they are “IT-based”; Dalkir, 2005;
Davenport, 2007), whereas in other cases, personal interaction between individuals is
the key (i.e. “people-focused” knowledge management; Wiig, 2004).
Although ad hoc or specific initiatives for knowledge sharing could be very helpful
in order to enhance knowledge creation and subsequent innovation, knowledge
sharing should not be understood as something to be apart from day-to-day business
management. On the contrary, knowledge sharing should pervade everyday work and
be embedded at the heart of the firm’s basic management processes (strategy
formulation, organization, and control). Along these lines, several authors have paid
attention to the organizational context or management conditions which could support
knowledge creation and knowledge sharing processes (Hedlund, 1994; Nonaka and
Takeuchi, 1995; Nonaka et al., 2003). However, the study of the knowledge sharing
which takes place through the aforementioned management processes (strategy
formulation, organization, and control) has not really been addressed by the
researchers in the knowledge management arena. This study is intended to shed some
light on this issue.
JIC Given the existence of different types of knowledge sharing (IT-based,
people-focused, and the one which takes place through day-to-day management
10,1 processes) and given the existence of different innovation capability dimensions (see
section 1), the question arises as to the degree of relevance of each type of knowledge
sharing in order to enhance each of the innovation capability dimensions.
For this to be tested, a first set of hypotheses has been formulated:
24 H1. Knowledge sharing which takes place through day-to-day management
processes has a positive impact on:
H1a. The generation of new ideas.
H1b. Innovation project management.
H1c. Timeliness and cost efficiency.
H2. Knowledge sharing which takes place by means of IT-based initiatives
positively affects:
H2a. The generation of new ideas.
H2b. Innovation project management.
H2c. Timeliness and cost efficiency.
H3. Knowledge sharing which takes place by means of people-focused initiatives
has a positive impact on:
H3a. The generation of new ideas.
H3b. Innovation project management.
H3c. Timeliness and cost efficiency.
As far as this first level of analysis is concerned, and as regards the new idea
generation process, another influential element connected to knowledge management
has been considered: the existence of a knowledge vision. This refers to the guideline
principles that indicate to an organization’s members in which area knowledge creation
or innovation should be pursued, and which competence of a corporation should be
utilized to accomplish innovation (Ichijo, 2007). Having a clearly established and
shared knowledge vision should increase the effectiveness of the new idea generation
process. Therefore, the following hypothesis has been tested:
H4. The existence of a knowledge vision positively affects the new idea generation
process.
Moreover, it may be considered that managing innovation projects effectively can have
a positive impact on the generation of new ideas. For instance, a good project
management method may help to keep record of lessons learned, and thus to build new
knowledge on a more sound basis. This is more in accordance with a non-linear vision
of the innovation process (Kline and Rosenberg, 1986). In addition, a good project
management system should lead to timeliness and cost efficiency. According to this,
the following hypotheses have been formulated:
H5. Managing innovation projects effectively positively affects the new idea
generation process.
 H6. Managing innovation projects effectively has a positive impact on timeliness Knowledge
and cost efficiency. sharing and
Moving now on to the second level of our research, the aim here is to analyze the degree innovation
of relevance of each innovation capability dimension on value creation. For this to be
checked, the hypotheses formulated are as follows:
H7. The new idea generation process has a positive impact on value creation. 25
H8. Managing innovation projects effectively positively affects value creation.
H9. Timeliness and cost efficiency have a positive impact on value creation.
Finally, the role of technology intensity as a moderator variable in the research model
(see Figure 1) has been explored. Two types of companies have been considered –
medium-high and high technology companies versus medium-low and low technology
firms. In the case of the first group, the knowledge dealt with is supposed to be more
complex and “sophisticated” than in the case of the latter group. Therefore, it would be
interesting to see whether this has any influence on the type of knowledge-sharing
mechanism which is more effective in order to enhance the innovation capability of

Figure 1.
Research model
JIC firms, and whether this affects the degree of relevance of each innovation capability
dimension on value creation.
10,1
3. Research method
The population subject to study is made up of Spanish manufacturing firms (energy,
water, and construction companies included) with over 50 employees and with R&D
26 expenses in their balance sheet. In order to gather information about the relevant
variables of the research, an ad hoc questionnaire was designed and addressed to the
CEOs of the companies making up the target population by the end of the year 2006
and the beginning of the year 2007. One hundredand forty-two answers out 1,239 were
obtained, which means an average response rate of 11 percent. Seventy-five
questionnaires corresponded to medium-high and high-technology companies and 67
to medium-low and low-technology firms.
A PLS structural equation modeling approach was used to analyze the data. PLS is
a common methodological approach used in management research (Bontis et al., 2007;
Bontis and Serenko, 2007). The PLS approach works in two stages:
(1) The assessment of the reliability and validity of the measurement model.
(2) The assessment of the structural model.

This sequence ensures that the constructs’ measures are valid and reliable before
attempting to draw conclusions regarding relationships among constructs (Barclay
et al., 1995).
The sample sizes obtained are large enough to carry out a statistical study based on
the PLS structural equation modeling approach (Chin and Frye, 2003). According to the
complexity level of the model to be tested, the minimum sample size required was
calculated, and this was made up of 70 firms. Thus, in the particular case of
medium-low and low-technology firms, the sample size is just on the border line.
In the next section, the measurement model is presented in more detail.

4. Constructs and measures

The first set of constructs of the model is the one related to the different types of
knowledge sharing taken into consideration. In the case of the knowledge sharing
which takes place through day-to-day management processes (MPKS), the following
items have been measured:
MPKS1. Whether the strategy formulation process allows a wide set of
contributions and viewpoint exchange to occur among the members of
the company (Aramburu et al., 2006).
MPKS2. Whether middle managers contribute effectively to the exchange of
knowledge and information among upper and lower hierarchical
levels (Nonaka and Takeuchi, 1995).
MPKS3. Whether strategy follow-up meetings based on the use of the balanced
scorecard are an important point for reflection, viewpoint exchange,
and subsequent adoption of action (Simons, 2000).
MPKS4. The degree of incorporation of external agents’ thoughts and
viewpoints in management processes (Almeida et al., 2003).
In the case of IT-based knowledge sharing (ITKS), the degree of use of different Knowledge
IT-based instruments as a means for knowledge sharing has been analysed (Dalkir, sharing and
2005; Davenport and Prusak, 2000):
innovation
ITKS1. E-mail.
ITKS2. Online discussion forums and/or blogs.
27
ITKS3. Intranet.
ITKS4. Extranet.
ITKS5. Groupware tools.
ITKS6. Online knowledge repositories.
Finally, as far as people-focused knowledge sharing (PKS) is concerned, the degree of
use of different initiatives in order to promote social interaction among individuals has
been measured (Wiig, 2004):
PKS1. Communities of practice and/or meetings by field of interest.
PKS2. Forums.
PKS3. Storytelling and/or lessons learned and/or best practice collection and
diffusion.
PKS4. Coaching and/or mentoring.
PKS5. Employee functional rotation.
PKS6. Employee external mobility.
PKS7. Meeting events and/or workshops in order to promote reflection as
well as knowledge and experience sharing with external agents.
All the indicators proposed so far have been measured by means of seven-point Likert
scales (1-7) and are formative in nature: that is, the use of the different initiatives
mentioned gives rise to the existence of knowledge sharing (i.e. the latent variable
being analyzed).
The next construct of the model refers to the existence of a knowledge vision (KV).
In this case, the following items have been considered:
KV1-5. The existence of specific policies and/or guidelines related to different
domains of innovation (products and/or services; production and/or
service delivering methods; logistics; marketing; and management
methods), together with the degree of cognition of the aforementioned
policies and/or guidelines by the members of the company.
KV6. The degree of visibility of top management’s commitment to
innovation.
Although the last indicator proposed was measured by means of a seven-point Likert
scale (1-7), the measurement of the first five indicators (KV1-5) was done in a slightly
different way. First of all, the managers were asked to tell whether policies and/or
JIC guidelines existed for the different domains under consideration, and then, for those
10,1 elements with specific policies and/or guidelines, the managers were asked to assess
the percentage of the head count that was aware of them. Five possibilities were
proposed:
(1) less than 25 percent;
(2) 25 percent or more, but less than 50 percent;
28
(3) 50 percent or more, but less than 75 percent;
(4) 75 percent or more, but less than 100 percent; and
(5) 100 percent.

Thus, the whole scale for each domain of innovation ranges from 0 to 5, “0” meaning
that no policy and/or guideline exists for that domain, and “5” that the policies and/or
guidelines defined are known by all the members of the company.
Again, this construct is formative in nature – that is, the existence of the different
policies and/or guidelines and the degree of visibility of top management commitment
to innovation give rise to the existence of a knowledge vision.
We then have the set of constructs corresponding to each of the dimensions of the
innovation capability. The first is the one related to the new idea generation process
(NIG). In this case, the following items were checked, all of them referring to the last
five years:
NIG1. Whether the company has been able to identify numerous opportunities for
incremental improvement.
NIG2. Whether the company has been able to identify numerous opportunities for
radical innovation.
NIG3. Whether the firm has been able to identify many alternative and new uses
for already existing technologies.
NIG4. Whether the new idea generation process has been managed in a conscious
and effective way.
NIG5. Whether the company has been able to clearly distinguish which of the new
opportunities identified had a greater potential for development.
As far as innovation project management (PM) is concerned, this encompasses the
following indicators, all of them being related to the last five years:
PM1. Whether the method used by the company for innovation project
management has made things really easy.
PM2. Whether the company has been able to reuse the knowledge generated
through innovation projects carried out in the past.
PM3. Whether the different innovation projects carried out have been suitably
coordinated.
PM4. Whether the role distribution in innovation projects carried out in
cooperation has been the best it could be.
Finally, the timeliness and cost efficiency dimension (TCE) is made up of the following Knowledge
measures (once again, each referring to the last five years): sharing and
TCE1-2. Whether incremental/radical innovation projects carried out have innovation
been finished on time.
TCE3-4. Whether incremental/radical innovation projects carried out have
fitted into budgeted costs. 29
All the indicators corresponding to the different constructs making up the innovation
capability of firms were measured by means of seven-point Likert scales (1-7) and are
reflective in nature – that is, they reflect the goodness of each innovation capability
dimension.
To bring the presentation of the measurement model to a close, only the value
creation construct (VC) remains to be explained. With a five-year scope and using
again seven-point Likert scales (1-7), the following reflective measures were chosen:
VC1. Whether incremental innovation projects carried out have shown expected
results.
VC2. Whether radical innovation projects carried out have shown expected
results.
VC3. Whether innovation outcomes have had a very positive impact on the
company’s income statement.
VC4. Whether innovation outcomes have had a very positive impact on the
company’s competitive position.
VC5. Whether innovation outcomes have allowed the company to grow and
improve its market share.

5. Research findings
Following the sequence of analysis described in section 3, the main findings of the
multivariate analysis carried out are as follows.
As far as the measurement model evaluation is concerned, this differs depending on
the nature of the construct. In the case of constructs made up of reflective indicators
(i.e. when the observed measures are the consequence of the latent variable, and
therefore should be highly correlated), individual item reliability, construct reliability,
convergent validity, and discriminant validity should be checked. However, in the case
of constructs made up of formative indicators (i.e. when the observed measures give
rise to the existence of the latent variable), multicolinearity problems should be
explored.
As regards the reflective constructs of the model (the ones related to innovation
capability and value creation) all the tests carried out have shown satisfactory results.
Indicator loadings (individual item reliability) are greater than 0.7, with a few
exceptions that are nevertheless very close to the aforementioned limit (the lowest
value is 0.6316). On the other hand, composite reliability (which measures construct
reliability) is higher than 0.8 in all cases; average variance extracted (which measures
convergent validity) is greater than 0.5 in all constructs; and discriminant validity is
JIC excellent too. As regards formative constructs (i.e. the rest of the constructs of the
10,1 model), multicolinearity problems have not been identified.
Once the quality of the measurement model has been guaranteed by means of the
aforementioned tests, the quality of the structural model should then be assessed. This
refers to the strength of the research hypotheses and to the amount of variance
explained (R 2) in the case of endogenous constructs, as well as to an analysis of the
30 predictive power of the model.
In order to assess the research hypotheses, path coefficient levels should be
examined, as well as their degree of significance, by means of bootstrapping
techniques. Table I summarizes the results obtained.
The path coefficients shown in Table I reflect the direct impact of a particular
construct on another. However, the conceptual model applied in this research (as
shown in Figure 1) encompasses several mediating effects too. For instance,
considering that managing innovation projects effectively may reinforce the goodness
of the new idea generation process, as well as the timeliness and cost efficiency
dimension of the innovation capability, the different types of knowledge sharing
analyzed not only have an impact on the aforementioned innovation capability
dimensions directly, but also through the project management construct.
Therefore, the aforementioned indirect effects should be calculated too. This is what
has been done in Table II, by multiplying the values of the path coefficients involved in
each mediating effect. According to this, the following conclusions can be drawn.
As regards the degree of influence of each type of knowledge sharing on the new
idea generation process, and with the exception of the knowledge sharing which takes
place through day-to-day management processes (which in no case has a relevant
influence on this dimension), important differences arise according to the technology
intensity of the companies analyzed. In the case of medium-high and high-technology
companies, people-focused knowledge sharing initiatives are key, whereas in the case
of medium-low and low-technology firms, IT-based initiatives appear to be the most
relevant.
On the other hand, the additional t-tests carried out for the multi-group analysis
(Chin, 2003) show that the difference between the two types of company is statistically
significant with regard to people-focused knowledge sharing, whereas in the case of
IT-based knowledge sharing the aforementioned difference is in the threshold of being
significant.
These findings may suggest that the degree of complexity and sophistication of the
knowledge being dealt with in the case of medium-high and high-technology
companies makes it more difficult to articulate it (a necessary condition for IT-based
knowledge sharing). Thus, personal interaction becomes more relevant. In contrast, in
the case of medium-low and low-technology firms, the lower degree of complexity of
the knowledge being dealt with makes it easier to articulate it and to share it by means
of IT-based initiatives, this being extremely effective.
In addition, having a knowledge vision which is shared by the members of the
company appears to be an essential condition in order to enhance the effectiveness of
the new idea generation process. This is true for all the companies analyzed and,
moreover, to a very similar extent. Additionally, the results obtained show that
managing innovation projects effectively clearly reinforces the generation of new
 Medium-high and high-technology Medium-low and low-technology
General sample companies companies
Path coefficients t-value Path coefficients t-value Path coefficients t-value
Hypotheses (b ) (bootstrap) Support (b) (bootstrap) Support (b ) (bootstrap) Support

H1a: MPKS ! NIG 0.053 0.6572 No 0.039 0.3405 No 2 0.028 0.2276 No

H1b: MPKS ! PM 0.268 * * 2.7318 Yes 0.230 * 1.7350 Yes 2 0.289 * 2.5453 Yes
H1c: MPKS ! TCE 0.162 1.2601 No 0.207† 1.2956 Yes 0.058 0.3394 No
H2a: ITKS ! NIG 0.195 * * 2.5417 Yes 0.065 0.5490 No 0.318 * * 2.7568 Yes
H2b: ITKS ! PM 0.178 * 2.1341 Yes 0.183† 1.4593 Yes 0.195† 1.6470 Yes
H2c: ITKS ! TCE 0.017 0.1786 No 0.154 1.0798 No 2 0.078 0.5305 No
H3a: PKS ! NIG 20.011 0.1112 No 0.270 * * 2.3513 Yes 2 0.147 1.0654 No
H3b: PKS ! PM 0.256 * * 2.7809 Yes 0.352 * * * 3.0411 Yes 0.209† 1.5256 Yes
H3c: PKS ! TCE 0.020 0.1464 No 0.073 0.4154 No 0.169 0.9839 No
H4: KV ! NIG 0.303 * * * 3.7790 Yes 0.330 * * * 3.2110 Yes 0.314 * * 2.5787 Yes
H5: PM ! NIG 0.363 * * * 4.4695 Yes 0.224 * 2.3272 Yes 0.428 * * * 3.8106 Yes
H6: PM ! TCE 0.392 * * * 3.9030 Yes 0.251† 1.5523 Yes 0.448 * * 2.9474 Yes
H7: NIG ! VC 0.478 * * * 6.8714 Yes 0.351 * * * 3.1954 Yes 0.615 * * * 5.9251 Yes
H8: PM ! VC 0.149 * 1.7820 Yes 0.326 * * * 3.2380 Yes 2 0.036 0.2475 No
H9: TCE ! VC 0.177 * * 2.4659 Yes 0.213 * 1.9031 Yes 0.144 1.2150 No
Notes: * * *p , 0:001; * *p , 0:01; *p , 0:05; †p , 0:1 (based on t499, one-tailed test). t ð0:001; 499Þ ¼ 3:107; t ð0:01; 499Þ ¼ 2:334; t ð0:05; 499Þ ¼ 1:648; t ð0:1; 499Þ ¼
1:282
innovation
Knowledge

Structural model
evaluation – Part I
sharing and

31

Table I.
 JIC

32
10,1

Table II.
Structural model
evaluation – Part II
Medium-high and high technology Medium-low and low technology
General sample companies companies
Direct Direct Total Direct Direct Total Direct Direct Total
Endogenous Antecedent effect Indirect Total effect effect effect Indirect Total effect effect effect Indirect Total effect effect
constructs constructs (b ) effect effect RK RK (b) effect effect RK RK (b ) effect effect RK RK

NIG MPKS 0.053 0.097 0.150 4 4 0.039 0.052 0.091 5 5 20.028 0.124 0.096 5 4
ITKS 0.195 0.065 0.260 3 3 0.065 0.041 0.106 4 4 0.318 0.083 0.401 2 2
PKS 20.011 0.093 0.082 5 5 0.270 0.079 0.349 2 1 20.147 0.089 20.058 4 5
KV 0.303 0.303 2 2 0.330 0.330 1 2 0.314 0.314 3 3
PM 0.363 0.363 1 1 0.224 0.224 3 3 0.428 0.428 1 1
PM MPKS 0.268 0.268 1 1 0.230 0.230 2 2 0.289 0.289 1 1
ITKS 0.178 0.178 3 3 0.183 0.183 3 3 0.195 0.195 3 3
PKS 0.256 0.256 2 2 0.352 0.352 1 1 0.209 0.209 2 2
TCE MPKS 0.162 0.105 0.267 2 2 0.207 0.058 0.265 2 1 0.058 0.129 0.187 4 3
ITKS 0.017 0.070 0.087 4 4 0.154 0.046 0.200 3 3 20.078 0.087 0.009 3 4
PKS 0.020 0.100 0.120 3 3 0.073 0.088 0.161 4 4 0.169 0.094 0.263 2 2
PM 0.392 0.392 1 1 0.251 0.251 1 2 0.448 0.448 1 1
VC NIG 0.478 0.478 1 1 0.351 0.351 1 2 0.615 0.615 1 1
PM 0.149 0.243 0.392 2 2 0.326 0.132 0.458 2 1 20.036 0.328 0.292 3 2
TCE 0.177 0.177 3 3 0.213 0.213 3 3 0.144 0.144 2 3
Note: RK ¼ ranking
ideas, especially in medium-low and low-technology firms (in any case, the difference Knowledge
with medium-high and high-technology companies is not statistically significant). sharing and
In the case of innovation project management, all the types of knowledge sharing
considered are relevant in order to enhance this dimension, and no significant innovation
difference arises according to the technology intensity of the company. Therefore, it
seems that the degree of complexity and sophistication of the knowledge being dealt
with only affects the ideation phase and not the execution phase. 33
Moving on now to the timeliness and cost efficiency dimension, and as regards
medium-high and high-technology companies, the knowledge sharing which takes
place through day-to-day management processes appears to be the most relevant,
whereas in the case of medium-low and low-technology firms, people-focused
knowledge sharing is the most important (especially when adding the indirect effect).
On the other hand, and as was the case with the new idea generation process,
managing innovation projects effectively positively affects timeliness and cost
efficiency. Indeed, this is the most influential aspect of this innovation capability
dimension for medium-low and low-technology firms, and the second most influential
in the case of medium-high and high technology companies.
In any case, no significant difference exists between the two groups of firms as
regards the levels of the paths that are connected to this dimension (i.e. timeliness and
cost efficiency).
Finally, as far as the impact of each innovation capability dimension on value
creation is concerned, important differences exist depending on the technology
intensity of the companies analyzed. In the case of medium-high and high-technology
firms, and looking at total effects, a more balanced situation is observed: project
management is slightly ahead of ideation, and timeliness and cost efficiency play a
more secondary role in value creation, albeit a relevant one. However, in the case of
medium-low and low-technology firms, ideation is by far the most relevant innovation
capability dimension for value creation. Indeed, the differences between the two types
of company examined are statistically significant, both for ideation and project
management.
What could explain this situation? Considering that technological innovation
(product/process) is the prevalent one among the companies analyzed, complexity and
sophistication could again be behind the results obtained. In the case of a high-tech
company, once the ideation phase is completed, making the new idea a reality may
involve a very complicated process (consider, for example, a pharmaceutical firm), and
therefore a great part of the final success will depend on the effectiveness of the
execution phase. In contrast, in the case of a low-tech company (let us take a clothes
manufacturer), once the new idea has emerged, making the new concept a reality will
not be so complicated (talking in relative terms, of course), and therefore the main part
of the success will depend on the brightness of the new idea.
To bring the structural model evaluation to a close, the amount of variance
explained in each of the endogenous constructs and the predictive power achieved
should be analyzed. The latter has been verified by means of the Stone-Geiser test,
where cross-validated redundancy (Q 2) must be higher than 0 in order to consider that
the model, as it refers to each specific endogenous construct, has predictive power.
Table III summarizes the results obtained.
JIC
Medium-high and Medium-low and
10,1 high-technology low-technology
General sample companies companies
Variance Predictive Variance Predictive Variance Predictive
Endogenous explained power explained power explained power
constructs (R 2) (Q 2) (R 2) (Q 2) (R 2) (Q 2)
34
NIG 50.42 0.2027 53.71 0.2000 57.54 0.2415
PM 35.12 0.0957 43.71 0.1676 33.21 0.0671
TCE 26.74 0.0059 32.24 0.0426 30.36 2 0.0253
Table III. VC 46.83 0.2001 54.09 0.2633 44.80 0.1669
Structural model
evaluation – Part III Note: Variance figures are percentages

As can be seen, the amount of variance explained for the different constructs is quite
good, and the model proposed accounts for 54 percent of the variance explained in the
case of the value creation construct (medium-high and high technology firms) and for
45 percent in the same construct for medium-low and low-technology firms. As a result
of this, the degree of predictive power achieved is also a good one, except in the case of
the timeliness and cost efficiency dimension in the medium-low and low technology
group, where the value of the Q 2 parameter is slightly lower than 0.

6. Conclusions
The research carried out shows that knowledge sharing is a key issue in order to
enhance the innovation capability of firms. Nevertheless, depending on the innovation
capability dimension being considered and the technology intensity of the firm, the
type of knowledge sharing which appears to be more fruitful varies.
Technology level also moderates the relationship between innovation capability
and value creation. Whereas in the case of medium-high and high-technology
companies the influence of the different innovation capability dimensions on value
creation is quite balanced, in the case of medium-low and low-technology firms
ideation is by far the most relevant dimension.
Additionally, the role played by innovation project management is really
noteworthy. Managing innovation projects effectively clearly reinforces the
timeliness and cost efficiency dimension, but the ideation phase also clearly benefits
from good project management. Therefore, the conception of innovation as a non-linear
process is clearly supported.
Moreover, as far as the new idea generation process is concerned, having a
knowledge vision which is shared and known by the members of the company is an
essential element in order to guarantee the effectiveness of the aforementioned process.
From a practical point of view, the results obtained provide companies with useful
insight in order to prioritize their knowledge management efforts. Depending on the
specific weaknesses a company detects on its innovation capability, the results
obtained in the research offer important clues so as to improve the situation. For
instance, let us consider a low-tech firm with serious flaws in its ideation process, but
with quite a good project management system. In this case, the research carried out
would suggest reinforcing the company’s IT-based knowledge-sharing mechanisms, as
well as intensifying communication efforts regarding the firm’s knowledge vision. Knowledge
However, in the case of a high-tech company with the same problem, intensifying sharing and
people-focused knowledge sharing would be more appropriate, with the knowledge
vision reinforcement also being a good point. innovation
In any case, the results presented in this paper need further confirmation. For this to
be done, replicating the survey in different settings would be necessary, as well as
carrying out in-depth analysis of different companies, so as to better understand the 35
dynamics of knowledge sharing in innovation contexts.

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Corresponding author
Josune Sáenz can be contacted at: ysaenz@ud-ss.deusto.es

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