Strengthening Organizational Performance Mediated by Absorptive Capacity Through Knowledge Management and Entrepreneurship Orientation

Creative resources applied in the digital age 4.0, creative ideas in the industrial world with unique products are generally used to improve organizational performance. This study analyzes knowledge management (KM), and entrepreneurship orientation (EO) on organizational performance through absorptive capacity (AC) in rural banks in Bali Province. The study population was 160 rural banks in Bali and the sample used the random quota method with the number of respondents as much as 5 percent, namely as many as 120 people. Research analysis method with SEM-PLS technique. The results of the hypothesis test found that 1). There is a positive relationship between knowledge management (KM), and absorption (AC) to organizational performance (OP), 2). there is no effect of entrepreneurial orientation (EO) on organizational performance (OP). 3). Knowledge Management (KM) does not affect absorption (AC), 4). There is a significant positive relationship between entrepreneurial orientation (EO) to absorption capacity (AC).5). Absorption capacity (AC) has not been able to be a mediating variable in the relationship between knowledge management (KM) and organizational performance (OP). 6) absorption (AC) can be a mediating variable in the relationship between entrepreneurial orientation (EO) with organizational performance (OP) in rural banks in Bali Province.