Nurturing Innovation Through People: Impact of Knowledge-Based Human Resource Management and Knowledge Sharing

Although knowledge-based human resource management (KHRM) is widely recognized as an enabler of innovation, it remains unclear how much of its influence operates through knowledge sharing (KS), particularly where knowledge is highly mobile and largely tacit. As human resource practices are unlikely to translate into innovation without the knowledge behaviors they elicit, the mediating role of KS requires direct examination. Grounded in the knowledge-based view and complemented by the ability–motivation–opportunity framework and the dynamic capabilities view, this study examines the mediating role of KS in the relationship between KHRM and employees’ perceptions of firm innovation performance (IP) in the Indian software industry. Data were collected through convenience sampling from 156 software professionals in 15 software companies in Bangalore and Hyderabad, India, and analyzed using partial least squares structural equation modeling. KHRM was strongly associated with KS (β = 0.715) and directly associated with IP (β = 0.326), and KS was positively associated with IP (β = 0.329). KS partially mediated the KHRM–IP relationship, with the indirect effect accounting for approximately 41.9% of the total association in this sample. The findings suggest that employees’ perceptions of KHRM are associated with their perceptions of IP both directly and through KS. High knowledge mobility and tacitness, which were not measured, provide a possible explanation for these findings. However, their influence remains to be tested. This study offers a context-informed account of this mechanism and guidance for managing knowledge in high-attrition industries.