An Empirical Study of How the Knowledge Management Is a Driver of Innovation for Software Sector SMEs in México

Purpose – Knowledge Management (KM) in Innovation process (INNOV), is a powerful engine that drives the company towards competitiveness (INSEAD, 2014; WEF, 2014); however, many small and media enterprises (SMEs) in México, ignore it. So, the aim of the present study is to discover the key factors of KM that are involved in the INNOV, prevailing in the field of software sector SMEs in Guadalajara (SSG), Mexico.Design/methodology/approach – This research is a documental study about KM and how is related as driver on the INNOV; to achieve this, it was designed a questionnaire splitted in two parts: the first one, corresponding to KM that involved (5) factors: KM Leadership (KMLD); KM Capture and Acquisition (KMCA); KM Training and Mentoring (KMTM); KM Policies and Strategies (KMPS); KM Communications and Rewards (KMCR) with 23 total indicators as variables. The second one, INNOV that involved (6) factors: Innovation Value Added (IVADD); Innovation Input Items (IIIT); Innovation Process (INPROC); Innovation Output Items (IOIT); Innovation Performance (IPERF) and Innovation Feedback (IFEED) with 39 total indicators as variables. So, we designed a questionnaire (62 variables), as a measurement instrument based on Likert Scale (1 to 5 interval) in order to determine the degree of agreement with well Cronbach's Alpha confidence (0.8432). We proceeded to do a survey to the total 200 CEOs belonging to the SMEs from SSG. The results were analysed using Structural Equations Modelling (SEM) to find validity and reliability of the structure to discover by the system equations, the underlying variables and their interrelationships. Finally, we found most representative KM variables to drive the INNOV, were: KMCA (0.9095); KMCR (0.8845); KMTM (0.8815); KMLD (0.8780); KMPS (0.8235). Finally we solved the (5) hypotheses finding the relationship between the KM factors and INNOV have significant positive effects.Originality/value – It lies in the design of a construct that identify the underlying KM factors and variables sized according an exploratory and multi-correlational study to drive 1814 the INNOV. All the factors and variables were collected from the principal theories about both subjects and jointed in a solid set by SEM to find their respective correlations.Practical implications – This study, shall serve to the SSG to identify what variables and factors from KM, are able to drive the INNOV and get a better place for competitiveness