Abstract

Small and medium sized enterprises (SMEs) cover a high percentage of total operating enterprise number and play an important role in economic development and job creation. They have very limited resources. Knowledge is the only resource that they can exploit to create competitive advantage and organizational performance. The managerial system of SMEs is established and controlled by the owner manager reflexing their cognitition and values. Hence, knowledge management in SMEs is also dependent upon their cognition and values created from their demographic variables such as age, education, profession, managerial experience as well as personality characteristics; namely, need for achievement, locus of control, flexibility to name a few. These owner manager’s characteristics exert influence on the knowledge management and organizational performance. In this study, a model is introduced to explain the relationship between owner manager’s characteristics, knowledge management and organizational performance with market orientation as a mediator for the relationship between knowledge management orientation and organizational performance.