Building Resilience in Fragile Healthcare Systems: The Role of Knowledge Management and Intellectual Capital in Improving Service Quality in Iraq

This study examines how Knowledge Management (KM) relates to Health Service Quality (HSQ) in fragile healthcare systems, both directly and indirectly through Intellectual Capital (IC), which encompasses human, structural, and relational capacities. Iraq’s healthcare system, weakened by decades of conflict and resource constraints, provides a critical empirical context. A cross-sectional survey of 201 healthcare professionals across Iraqi public hospitals was conducted between January and March 2025. KM and IC were operationalized as second-order reflective-formative constructs using validated scales adapted to the Iraqi context. Partial Least Squares Structural Equation Modeling (PLS-SEM) with SmartPLS 4.0 assessed measurement validity, structural relationships, mediation, and predictive accuracy (power = 0.95, α = 0.05). KM was associated with HSQ through both direct effects (β = 0.335, 95% CI [0.111, 0.563], p = 0.008) and stronger indirect effects mediated by IC (β = 0.468, 95% CI [0.228, 0.710], p < 0.001), indicating that knowledge practices are most effective when they build organizational intellectual capital. These findings are interpreted through the specific constraints of a fragile, conflict-affected context; fragility itself was not modelled as a construct but functions as the defining contextual condition that shapes how KM and IC operate. Because the sample was limited to four urban public tertiary hospitals in Baghdad and Basra, the results describe how KM and IC operate in this segment of a fragile system rather than across Iraq’s health sector as a whole. It should be noted that HSQ was assessed by healthcare providers; patient-reported quality was not directly captured. IC showed complementary partial mediation, carrying 58.3% of KM’s total effect on HSQ. The model explained 80.3% of variance in IC (Q 2 = 0.687) and 69.7% in HSQ (Q 2 = 0.562), with all constructs meeting reliability and validity thresholds (CR > 0.85, AVE > 0.60, HTMT < 0.85).