1. Introduction
Since the intensification of knowledge management, the values in the process of organizational innovation is taking place increasingly in the business industry [
1]. Business firms intensely observe an indispensable role of organizational innovation, feasibility endurance, and success by the capacity of grasping the enshrouded value of critically attained, implicit, and explicit knowledge [
2]. In recent years, services or products of traditional labor and innovative organizations have progressively substituted with unceasing revolution by customers’ needs, necessities, and demands through knowledge-based businesses [
3,
4]. Knowledge management is categorically a dynamic factor for business organizations, predominantly garments, and textile industry [
5]. In today’s competitive and turbulent market, knowledge management sharing plays an indispensable role in creating new knowledge in the process of sustainable innovation in organizations. In an earlier study, Barachini (2009) recognizes that business firms have to inspire their workforce to share critical information and knowledge regularly to grasp and reuse in hand knowledge assets [
6]. Typically, scholars focus on the organization's idea of developing knowledge management and supportive culture for the innovation process.
Business firms seek to build a knowledge-friendly strategy, which helps them in sharing, transmitting, and reusing valuable insights. Instantaneously, business companies take measures in introducing methods of useful knowledge sharing and procedures of innovation in daily business operations to enhance creativity, innovation, and business performance worldwide s. In the present unstable economic environment, globalization, innovation, rapid technological advancements have become strategic and financial drivers. The process of innovation in a business organization heavily relies on the availability of knowledge. Access to knowledge enhances innovation, which helps business organizations to achieve valuable benefits, effectiveness, sustainability, growth, and economic prosperity [
7]. Sustainable organizational innovation (SOI) is a continuous process of perceiving, exploring, and learning, which enables enterprises and business organizations to innovate new procedures in business organizations, new markets, new and improved products, and services [
8]. Presently, knowledge management (KM) is a well-established and recognized field of study. Lin [
9] defined KM as flow and sharing of knowledge inside an industry or a firm. The studies have explored that KM empowers firms to create modern methods to realize viable benefits, effectively attaining knowledge, and improve sustainable organizational innovation [
10]. In views of Park, Ribière [
11], “Today’s world economy is recognized as enormous competitiveness in businesses, establishing learning systems, creating products and services mergers and adopting and managing rapidly changing technologies. Such kind of competitive and energetic business environment ask for managing organizational knowledge even more competitively.”
Wiig [
12] clarified knowledge management by defining it as a range of clearly described procedures, methods, and techniques employed to find out valuable information in different administrative procedures. He determined knowledge management's purpose was primarily to empower business in alternative perspectives, first to secure its prospects and achievements, after that, concentrate on building a firm or industry to sensibly, considering its knowledge assets. Though, the overall aim of KM is to improve organizational competitiveness [
13]. Knowledge management is the source of organizational achievement and a significant source in empowering businesses to produce innovative goods and services as well as grow new-markets and bringing sustainability in companies. Moreover, Adams and Lamont [
7] recorded in their research work that knowledge management is a vital source for realizing continuous innovation resulting in competitive and sustainable benefits. Effective knowledge management can bring immediate paybacks and improvement in workforce productivity, increase services value, and competitive advantages through creativity and consequently brings sustainability in firms [
10].
According to Levinthal and March [
14], organizational learning (OL) ensued as an added ability to compete with the changes takes place due to the influential and unstable organizational environment. Organizational learning leads to better output and acts as a tool to control and improve the performance of a business as well as realize ongoing organizational accomplishments [
15]. While the industry will progress to organizational innovation and the culture of OL motivates workers for creativity.
The garments and textile industry contribute almost 50% of Pakistan’s exports and are the primary principal constituent of trade. Garments sector, because of current promising changes for the businesses in Pakistan and the probable future developments in the global world business edifice for the industry, can perform a significant part in increasing Pakistani exports. Besides, garments-manufacturing echoes with Pakistan’s policy to help in saving and generating resources for employment and economic growth due to the sector’s capital intensive and energy saving nature [
16,
17]. Considering the economics as well as the employment importance of this sector, the researchers selected this sector.
The primary concern of the current study was theory related, i.e., examining the relationships between acknowledgment management, sustainable organizational innovation, and organizational learning. Existing knowledge management literature designates that already employed methods were uncertain, and the statistical link among knowledge management and organizational learning has not been principally stated [
18]. The current research concentrated on the new and original methods of calculating the association between knowledge management, sustainable organizational innovation, and organizational learning. Further, in what way the statistical connection can form virtuous debate concerning innovation procedures. The current research focuses on addressing the literature gaps highlighted above, and it attempted to examine the association between knowledge management and sustainable organizational innovation. At the same time, organizational learning was taken as a mediating variable by addressing the literature gap means the missing statistical link between the studied variables and the literature gap in terms of the garments industry, SMEs, and developing countries like Pakistan.
3. Materials and Methods
The materials and methods were designed to explain specific methodologies employed for testing and describing the empirical relationship between the studied variables knowledge management, organizational learning, and organizational innovation. This section includes study design, research philosophy, target population, study sample, research instrument used for data gathering, data gathering methods, study framework or model, techniques used for analyzing data, and research ethics.
The choice and implementation of a specific research-philosophy help the researchers to clarify the overall research method to be used, evaluate available methods, and be innovative and progressive in selecting and altering techniques that were implemented previously [
69]. Moreover, the concept of research philosophy is based on ideas, values, norms, organizational activities, and traditions. Research philosophy facilitates researchers in obtaining information and knowledge related to their area of study, and it is of three different forms, i.e., realism, positivism, and interpretivism McNabb [
70].
A positivist approach was used in this study, as suggested by Creswell and Creswell [
71]. The positivism approach is built on the judgments, scientific methods being followed, and causes, and their possible effects are being fixed [
71,
72]. Additionally, Mertens positivist approach is appropriate for a social or communal world with the prospect that the societal-world can be taken as the commonplace, employing an unbiased process that results in ordinary findings. However, according to Creswell, positivism philosophy concentrates on defining and describing the relationships, their causes, and impacts; it also simplifies the links and details for forecasting such relationships.
Saunders [
73], based on nature, has categorized research studies into three forms explanatory, exploratory, and descriptive. Exploratory research tries to define a research problem initially and collects basic information concerning to identify a problem and helps establish further research. Explanatory research seeks to shape essential links among studied variables, while the descriptive study is conducted to express a precise figure of situations, individuals, or events. As suggested in Saunders [
73], explanatory research, as well as cross-sectional examination, was employed in this research. This study intends to find the impact of knowledge management on organizational innovation and to check whether organizational learning can mediate the relationship between KM and organizational innovation. A cross-sectional design was employed in this study. The cross-sectional research tries to find the association among studied variables at a particular time. It describes the rise of a phenomenon that examined how the studied-variables are connected. The benefit of selecting a cross-sectional design is that it is comparatively economical and timesaving than a longitudinal study. In this study researcher employed structural equation modeling (SEM). The method of SEM is a set of statistical techniques that permits us to study relationships among independent and dependent variables, either one or more, as well as discrete or continuous. Variables or factors can measure the independent and dependent variables. SEM has alternative names such as simultaneous equation modeling, path analysis, causal analysis, causal modeling, confirmatory factor analysis, and analysis of covariance.
3.1. Population and Sample
The population under consideration for the present study included firms working in the garments industry of Gujranwala and Lahore divisions of Pakistan. Data were collected through a self-administered survey. A sampling frame was devised to contain all the garments sector firms situated in the targeted area and to support the selection of samples. A sample of 350 firms was selected for this research. The data from selected firms were gathered through a stratified random sampling technique, as stratified random sampling assists scientists to ensure that the chosen sample is a good representative of the population [
74].
3.2. Data Collection Instrument
The close-ended, well-structured items were used to collect responses, close-ended items are an effective way of gathering adequate organized replies, which empower numerical analysis, examining hypotheses, and illustrating conclusions. The reactions concerning all study variables were measured through a Five-point Likert scale.
3.3. Data Collection Methods
Groves and Couper [
75] specified that for the creation of valuable data or information, the data-gathering is a significant component. For the present study, researchers initially contacted the targeted firms on the phone as well as through e-mails to get proper consent from them to collect data. Once the formal approval was received, the study survey was distributed to the respondent firms. The participants were informed and briefed about the questionnaire contents to understand it before fulfilling it ultimately. The survey participants were requested to respond to the survey in two weeks. After two weeks, the researchers themselves collected all the distributed questionnaires from participants. Similarly, follow-ups were completed by emails and telephones to improve survey participation. Subsequently, on receiving the duly filled responses, the respondents were acknowledged.
3.4. Variables Measurement
The reliability and validity of the questionnaire employed in the current study were measured and evaluated. This precise study evaluated knowledge management through five different constructs adopted from the previous studies, as described in
Table 1. The selected constructs of knowledge management include expectations of associations with colleagues and peers, hopes of reward for sharing relevant information and knowledge employees contain, knowledge management attitudes, KM behavior, and expected contribution in the form of information and knowledge as indicated in
Table 1.
The available literature categorized organizations as early adopters, late adopters, innovators, and laggards in the literature that are cornering their level of innovation. The literature also classified innovation based on productivity as process innovation and product innovation, and the measures are taken considering inputs are resources spend on research and development, all these different measures were used and explained in the literature. As suggested and employed by Manu (1992), this study used three different types of innovation as measures for SOI, i.e., product innovation, process innovation, and administrative innovation, as illustrated in
Table 2.
Organizational learning in this study was measured by focusing on Huber’s model of OL. The researchers studied and analyzed measures used in the literature for OL [
104,
105,
106,
107,
108,
109]. Organizational variable learning was measured using four different dimensions of learning cited in the literature, i.e., acquiring, distributing, and interpreting knowledge as well as organizational memory. The study measured Organizational learning as a sole variable through a model having four dimensions, as discussed in
Table 3.
Following Wang and Hou (2015), education and age were taken as control variables in this study to examine the probable variations between studied SMEs and their possible effects on Organizational innovation processes.