How knowledge-based HRM practices affects aspects of innovation capability through knowledge management: the moderating role of innovative culture

Purpose Given the important of knowledge resource and human capital for improving innovation competence, the purpose of this study is to examine the influence of knowledge-based HRM practices on product and process innovation of firms via the mediating role of knowledge management capability and moderating role of innovative culture. Design/methodology/approach The paper used structural equation modeling and empirical data collected from 271 participants in 156 manufacturing and service firms to examine the level of how knowledge-based HRM practices and knowledge management affect product and process innovation under the moderating role of innovative culture. Findings The research findings confirm the mediating roles of knowledge management between knowledge-based HRM practices and two specific types of innovation namely product and process innovation. It also firstly reveals the positive moderating role of innovative culture in enhancing the effects of knowledge management on product innovation. The results underline the necessity of building an innovative climate and knowledge-based HRM practices to stimulate knowledge management for improving innovation capability of firms in the developing and emerging markets. Research limitations/implications The paper helps bring deeper insights to leaders and practitioners about the new knowledge-based approach that enhances innovation competence for organizations. Originality/value The paper significantly contributed to theoretical and practical initiatives on theory of HRM practices and knowledge management by showing different moderating and mediating mechanism thereby firms can follow to enhance innovation capability of firms in developing and emerging markets.