Analyzing the Impact of the Knowledge Management Process on the Banking Sector Performance: By Using the Partial Least Square Method

ABSTRACT The essence of this investigation was to elucidate the impact of knowledge management practices (KMP)—namely knowledge storage (KS), knowledge creation (KC), and knowledge application (KA)—on the performance dynamics of the banking sector in Yemen. Leveraging the partial least squares (PLS) method for analysis, this study scrutinized responses from 380 employees across Yemeni banks, revealing a significant and positive correlation between these knowledge management dimensions and the sector's performance metrics. Key to this study's findings is the assertion that KMP serves as a cornerstone for bolstering efficiency and competitiveness within Yemen's banking institutions. Notably, this research brings to light the pivotal roles played by both human capital and technological advancements in optimizing knowledge management processes. These factors collectively facilitate the sector's adaptability and responsiveness to the ever‐evolving financial landscape.