Navigating borders, cultivating innovations: the dynamic role of cross-border knowledge transfer in SMEs

While the last two decades have witnessed a burgeoning stream of research on cross-border knowledge transfer (CBKT), the current literature has remained relatively silent on how CBKT impacts innovation of SMEs in developing economies. Drawing on the dynamic capabilities view, this study examines the relationship between CBKT and small and medium-sized enterprises (SMEs)' innovation performance. In addition, we examined the mediating role of knowledge management dynamic capabilities (KMDC) in the relationship between CBKT and innovation performance. Empirical results using data from 370 SME owners and operators in Nigeria show that CBKT positively impacts the innovation performance of SMEs. We also found empirical support for the mediating role of KMDC on the relationship between CBKT and SMEs' innovation performance. Specifically, we observed that CBKT is significantly related to KMDC, leading to improved innovation performance among SMEs engaged in cross-border activities. This study advances existing literature by providing insight into the mechanisms and strategic linkages that support cross-border knowledge transfer and the innovation performance of SMEs in developing markets. The study outlines the implications for research and practice.