How intermediaries manage knowledge to support public procurement of innovation: The case of UK defence

We investigate how innovation intermediaries mobilise their knowledge management capacities to support public procurement of innovation (PPI). Prior research on PPI intermediation has highlighted various knowledge-intensive roles of intermediaries (e.g., as subject experts and trainers), but how exactly intermediaries are organised internally and how they operate to source, process, and transfer PPI-related knowledge remains elusive. We offer novel insights through a rich case study of intermediation in the UK defence context, where intermediaries are tasked with addressing gaps in innovation-oriented procurement knowledge and capabilities and help to improve procurement performance. We contribute to PPI intermediation literature by showing how intermediaries utilise their absorptive capacity and desorptive capacity to manage technical, commercial, and managerial knowledge in support of PPI implementation. We also extend the broader literature on innovation intermediaries by unveiling the organisational structures, processes, and routines underpinning the enactment of intermediary absorptive and desorptive capacities; and elucidating the distinctive nature of desorptive capacity in the context of innovation intermediation. We additionally demonstrate that intermediaries' absorptive capacity, rather than that of client organisations, creates value for intermediaries and their clients alike. • Innovation intermediaries mobilise their knowledge management capacities to support public procurement of innovation (PPI). • Intermediary absoprtive capacity and desortpive capacity are key to value creation. • We unveil the intermediary's organisational structures, processes, and routines underpinning these capacities. • Intermediary knowledge informs PPI decisions and suppliers' understanding of buyer needs and of supply chain capabilities.