Knowledge Creation and Financial Firm Performance: Mediating Processes from an Organizational Agility Perspective

Abstract

Knowledge creation has emerged as a critical area in information systems research in the past decade [1]. One of the mechanisms through which knowledge creation enhances firm performance has been theorized as organizational agility. This paper empirically examines the role of organization agility as a mediator between knowledge creation processes and financial firm performance. Our survey study of 134 firms combined with objective measures of firm performance indicates that two forms of organizational agility -- customer agility and operational agility, significantly mediate the effect of knowledge creation processes on firm performance. Our findings confirm prior research results that were based exclusively on survey data, and provide additional discussions on the role of organizational agility in facilitating the effect of knowledge creation processes on firm performance. Implications for researchers and managers are discussed.