The Influence of External and Internal Knowledge Sources on Innovative Performance of Craft SMEs: The Moderating Role of Organisational Learning

Purpose: The study aims to investigate the impact of external source of knowledge (EK) and internal source of knowledge (IK) on the innovative performance (IP) of SMEs in the craft industry, with a focus on the moderating role of organisational learning (OL) in this relationship. Methodology: The weavers in the craft industry of Ghana were purposefully selected, and out of the population, 321 were sampled using simple random sampling, of which 317 questionnaires were completed. Findings: The research revealed that sourcing knowledge both internally and externally has a positive impact on SMEs’ IP. Further, OL negatively moderates the relationship between EK and SMEs’ IP. Also, OL positively moderates the relationship between IK and SMEs’ IP. In the end, three hypotheses were supported, except for H3, which was rejected. Based on these outcomes, craft SMEs should focus on mentorship and training to strengthen internal knowledge. Craft associations and the government should fund these training initiatives to help weavers acquire new knowledge. Practical implications: The findings of the current study suggest that both internal and external sources of knowledge impact positively on craftworkers’ IP; however, internal source of knowledge helps best. Craft industries and associations should support sharing knowledge internally and be open to external trends, while still giving recognition to weavers who are inventors but are reluctant to share knowledge. Such initiatives would allow such inventors to be willing to share knowledge with others. OL was also found to have a significant positive effect on internal sources of knowledge and IP. Craft weavers who want to be more innovative in their work should create a good OL environment.