The business environment in which organizations including commercial banks are operating in is characterized by cut-throat competition and changing customer needs. Commercial banks need to be innovative to achieve customer satisfaction and competitive advantage. The ever-changing business environment has made enterprises to realize that knowledge is their key asset in enhancing innovation. This study sought to examine the effect of knowledge Generation on innovation in commercial banks in Kenya. The specific objective of the study was to determine the effect of knowledge generation on innovation. The study was guided by Resource-Based view, knowledge-based view and dynamic capabilities theories. The study adopted an explanatory research design and cross-sectional survey research design. The target population comprised of commercial banks licensed by the Central Bank of Kenya. The study employed a census survey method of all the 38 commercial banks in Kenya. The study used primary data which was collected using structured questionnaires. Descriptive statistics such as frequencies and percentages, means and standard deviation were used to summarize the data. Pearson’s correlation was used to examine the relationship between knowledge management practices and innovation. To test the research hypothesis, simple regression analysis was used. Findings showed that knowledge generation has significant and positive effect on innovation in commercial banks in Kenya. The study concludes that knowledge generation demonstrate a positive impact on innovation in commercial banks in Kenya. This suggests that effective management of knowledge generation enhances the ability of banks to innovate. The study recommends organizations to work towards recognizing their staff appropriately so that they can exhibit improved employee output in terms of knowledge management. Also, Banks ought to customize their training activities to enable employees to perform their duties better.
Ondieki et al. (Wed,) studied this question.