Relationship between Total Quality Management, Knowledge Management, and Innovation in the Construction Sector in Indonesia

The construction sector in Indonesia plays a very important role in global competitiveness. One of the main factors that promote national economic growth is innovation. Unfortunately, innovation performance in Indonesia, including the construction sector, is regarded as low. It is believed that the two main causes of low innovation are lack of knowledge and poor quality management. In light of that issue, this study examined the relationship of Total Quality Management (TQM), Knowledge Management (KM), and innovation in the construction sector in Indonesia. PLS-SEM approach was used to analyze the data obtained from 75 respondents, ranging from staff to managerial positions from 6 property developers in Indonesia. Property developers, who are the clients, are believed to be the most influential actors in increasing innovation in the construction sector. The results showed that TQM practices give a significant influence on KM processes through customer focus, people management, and process management. KM processes then give a significant influence on innovation through knowledge sharing and knowledge application.