Effects of knowledge management on innovation capabilities amongst small and medium enterprises in South Africa: The case of Buffalo City Metropolitan Municipality

Abstract

Background: South Africa is witnessing a growth in small and medium enterprises (SMEs). Given this rise in SMEs, there is a need to pay attention to those factors that influence how these enterprises perform.

Aim: The purpose of the study was to investigate the effects of knowledge management (KM) on innovation capabilities (IC) in SMEs with a special focus on Buffalo City Metropolitan Municipality.

Setting: This study is the first to investigate the effects of KM on IC in SMEs operating in South Africa. Given the scarcity of studies on KM in SMEs in the sub-Saharan region, this study contributes to the literature on the effects of KM on IC.

Method: A quantitative research approach was followed in carrying out this study. Descriptive and inferential statistics were performed to answer the research questions and test the hypotheses of the study. The respondents (n = 280) were SME representatives operating in the Buffalo City Metropolitan Municipality.

Results: Knowledge management is found to exert a positive effect on SMEs’ IC.

Conclusion: Findings from the study can assist various practitioners, directly or indirectly involved with development of business, to develop strategies that improve SMEs’ growth and sustainability. These practitioners include strategic management researchers, policymakers, SME owners and managers and lecturers.