Managing Knowledge to Improve Performance: the Impact of Leadership Style and Knowledge Management on Organizational Performance with Moderation Effects via PLS-SEM

The purpose of this study is to analyse the relationship of leadership styles with knowledge management and organizational performance, as well as to analyse the influence of moderating variables on the proposed research model. Structural equation modelling was used to analyse the demographic structures of medium and large companies in Slovenia. The sample consists of data from 135 Slovenian companies that completed the online questionnaire. The findings revealed that leadership style is positively related with knowledge management. Knowledge infrastructure is found to be the key success factor of knowledge management concept as it is positively influencing knowledge management processes. While transformational leadership improves organizational performance, the study did not confirm the influence of transactional leadership on organizational performance. In addition, knowledge management was not confirmed to have a significant influence on organizational performance. However, successful leaders should adopt and combine both styles of leadership in managing knowledge and improving organizational performance. The moderating effects of capital origin and type of ownership showed that foreign capital and private capital have varying influences on leadership style, knowledge management, and organizational performance. The results should be helpful for scholars hoping to glean additional insights regarding research topics, as well as for practitioners who can adjust their leadership style and knowledge management practices to improve their performance.