Management faculty of Shahid Sattari Aeronautical University Innovation Management in Defensive Organizations 2676-7112 7 4 2025 01 20 The Effect of Knowledge Absorption Capacity on Improving Innovation and Performance of Defense Knowledge Based Enterprises The Effect of Knowledge Absorption Capacity on Improving Innovation and Performance of Defense Knowledge Based Enterprises 23 42 212020 10.22034/qjimdo.2024.425268.1639 FA Reza Parsi MSc. In MBA, Marketing orientation, Faculty of Management, Kharazmi University, Tehran, Iran. Leila Saiedi Assistant Professor, Department of Management, Faculty of Management, Islamic Azad University, Tehran West Branch, Tehran, Iran Ali Jokar Assistant Professor, Department of Management, Shahid Sattari University of Aeronautical Sciences and Technology, Tehran, Iran. Journal Article 2024 01 02 Background & Purpose: Rapid technological changes have fundamentally changed the way firms' innovate, making the need for knowledge to collaborate and create shared value inevitable in today's markets. Therefore, this study investigated the indirect effect of knowledge absorption capacity (KAC) on the firm' performance (FP) through Innovation strategy (IS) and open innovation (OI).<br />Methodology: The present applied research has a quantitative approach, which is descriptive-survey in terms of nature and method. The statistical population of the research included 128 managers of knowledge-based enterprises in the field of defense. The sample size was determined based on Kerchesi-Morgan table of 97 people. Data were distributed and collected through a non-random sampling method, using a standardized questionnaire. Demographic data were analyzed with SPSS version 26 software, and research model data were analyzed by Smart PLS software version 3 by adopting the variance-based approach in structural equation modeling.<br />Findings: All hypotheses were confirmed at the 99% confidence level, and the results showed that the KAC has a positive and significant effect on the IS, and the input and output activities of OI. Also, the positive and significant impact of IS, and input and output activities of OI on the FP was confirmed.<br />Conclusion: This study contributes to the advancement of existing knowledge and theory in the fields of knowledge management and innovation with a special emphasis on knowledge-based enterprises, and provides relevant information to decision-makers to enable the development of innovation and maximize the performance of knowledge-based enterprises through strengthening the necessary capabilities. Background & Purpose: Rapid technological changes have fundamentally changed the way firms' innovate, making the need for knowledge to collaborate and create shared value inevitable in today's markets. Therefore, this study investigated the indirect effect of knowledge absorption capacity (KAC) on the firm' performance (FP) through Innovation strategy (IS) and open innovation (OI).<br />Methodology: The present applied research has a quantitative approach, which is descriptive-survey in terms of nature and method. The statistical population of the research included 128 managers of knowledge-based enterprises in the field of defense. The sample size was determined based on Kerchesi-Morgan table of 97 people. Data were distributed and collected through a non-random sampling method, using a standardized questionnaire. Demographic data were analyzed with SPSS version 26 software, and research model data were analyzed by Smart PLS software version 3 by adopting the variance-based approach in structural equation modeling.<br />Findings: All hypotheses were confirmed at the 99% confidence level, and the results showed that the KAC has a positive and significant effect on the IS, and the input and output activities of OI. Also, the positive and significant impact of IS, and input and output activities of OI on the FP was confirmed.<br />Conclusion: This study contributes to the advancement of existing knowledge and theory in the fields of knowledge management and innovation with a special emphasis on knowledge-based enterprises, and provides relevant information to decision-makers to enable the development of innovation and maximize the performance of knowledge-based enterprises through strengthening the necessary capabilities. https://www.qjimdo.ir/article_212020_9a8b5f4ea035bf1b270f12d7f998c4b4.pdf