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The present study investigates the relationship between CEO's information literacy and innovation in small and medium-sized enterprises (SMEs). Even if information literacy's business value has been recognized in recent literature, its impact on organizational innovation, a critical and strongly information intensive process, has never been studied before. Structural equation modeling based analysis of data collected from 184 company CEOs in Finland revealed that CEOs’ information literacy has a positive impact on the development of exploratory and exploitative innovations in SMEs. Additionally, opportunity recognition mediates the relationship between information literacy and innovation. Overall, the influence of information literacy is slightly stronger on exploitation than exploration. Nevertheless, the mutual positive effect suggests that information literacy enhances innovation ambidexterity in organizations. Based on these findings, we discuss theoretical and practical implications as well as future research opportunities in workplace information literacy research.
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