Today knowledge creation, an important part of knowledge management is an essential issue for success of every firm. But there are few researches which have investigated the role of this process on the performance of organizations. Thus to fill this gap this paper has tried to investigate the significance of knowledge creation process in improving the market, customer and financial performances of service sector organizations. To attain this goal this paper conducted the banking industry in Isfahan as one of the most important organizations in service-sector to investigate the nature of relationship between knowledge creation and organizational performance. In order to examine the main hypothesis Structural Equation Modeling (SEM) and Amos graphic have been used. The results imply that knowledge creation process can positively affect the performance of a service-sector organization.
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