Unpacking Antecedents of Knowledge Management Success: A Key to Firm Performance in the Banking Sector

In the era of the knowledge economy, knowledge management has become the primary source of existence, growth, and advancement, as well as a powerful means of value creation and a crucial determinant for productivity and competitiveness. Hence, the purpose of this paper was to investigate antecedents of the success of knowledge management. Moreover, this study also attempts to examine the effect of knowledge management on firm performance in the context of the banking industry. The study employed a cross-sectional survey design along with a quantitative research method. Data were collected using a structured survey questionnaire using the census sampling technique. SPSS version 26 and AMOS version 23 were used to perform descriptive statistics, factor analysis, and structural equation model (SEM), mainly path analysis. In this study, IT infrastructure, organizational structure, organizational culture, leadership style, training and education, and policy and strategy emerged as significant variables enabling the firm to create, transfer, integrate, and leverage knowledge. The results, however, revealed that the reward system is not significantly associated with knowledge management. It also became apparent that there is an indirect effect of knowledge management on firm performance. This study contributes to the broader literature on knowledge management success, and its effect on firm performance in Ethiopia’s banking industry. It can be suggested that implementing these knowledge enablers would contribute to the knowledge management strategy of firms which in turn results in improved performance in terms of profitability, customer satisfaction, growth, competitive position, and learning. Overall, the theoretical implications of this article suggest that knowledge management is a critical factor in driving firm performance in the banking sector and that firms need to invest in the necessary resources and infrastructure to support these efforts. By doing so, firms can create a culture of innovation and collaboration that will enable them to succeed in an increasingly competitive marketplace.