The Effect of Talent- and Knowledge Management on the Performance of SMEs: Evidence from Malaysia

The role of Talent Management (TM) and Knowledge Management (KM) in organisational performance has received increased attention across a number of disciplines in recent years. Determining the impact of TM and KM on organisational performance especially financial and innovation performance is important for the future of small-and-medium-sized enterprises (SMEs). There is a growing body of literature that recognises the importance of TM and TM for sustainable competitive advantages. Although TM,KM and their consequences are important, they are nonetheless understudied, which have led to some concern about these issues especially in an emerging country like Malaysia. As such, this PhD thesis has empirically tested the relationship between TM and KM and their effects on organisational performance. In addition, this study has also examined the interaction effect of senior managements' perception of the strategic importance of HR on the aforementioned relationships in a multi-industry sample of 144 Malaysian SMEs. It has used the resource-based view theory in its framework to place more emphasis on the ability of managers to drive better performance from the strategic human capital resources available to them. Supported by the too-much-of-a-good thing effects in management, the results have indicated inverted U-shape curvilinear relationships of TM-KM strategies and organisational performance. Furthermore, the results have also suggested that senior management's emphasis on strategic HR would have its primary interaction effects on KM strategy implementation and financial performance relationship. However, the positive influence has been positively significant at low level of senior managements' attention. This finding has shown the capability of Malaysian SMEs in implementing both of these strategies and underscored the importance of senior management in emphasising the importance of strategic human capital resources.