Knowledge management and innovation in SMEs: Case study in Lubango city/Angola

Abstract

This study investigates the relationship between knowledge management processes and organizational innovation in Small and Medium-sized Enterprises (SMEs) operating in the city of Lubango, as well as the associated implications and challenges for organizational performance. A quantitative research design was adopted, using data collected through a structured questionnaire administered to 50 managers. The findings from the regression analysis reveal that Organizational Innovation (β = 0.505) and Process Innovation (β = 0.341) exert positive and statistically significant effects on overall firm performance. Conversely, Product Innovation does not exhibit a statistically significant impact when examined simultaneously with the other explanatory variables. The model explains 64.2% of the variance in performance (adjusted R² = 0.642), with homoscedastic, independent residuals and no problematic multicollinearity (VIF < 3). The results indicate that, within the business context of Lubango, the attainment of sustainable competitive advantage by local SMEs is more closely related to the optimization of internal organizational structures and operational efficiency than to the introduction of new products.  Managers should prioritize knowledge sharing and application, organizational design, managerial training, and process optimization.