Abstract

Creativity and innovation are considered critical factors in promoting the competitiveness of small and medium-sized enterprises. The directors of these companies seek to know how to transform the results of creativity into innovation. Therefore, there is a growing interest in looking more deeply into the elements that affect creativity and innovation. This study analyses the following aspects: (a) The effect of the creative process on product and process innovation, (b) the role of knowledge management (KM) in the creative process, and (c) the role of industrial clusters in KM and the creative process. The research model is validated using Partial Least Squares data from industrial SMEs in Chile. The findings demonstrate the influence of industrial clusters on KM and the creative process and the impact of knowledge creation on the creative process. Our results enable a broader understanding of SMEs' creativity and innovation model.