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The aims of this research are to create innovation through knowledge sharing and absorptive capacity in ikat weaving industry Bali. This research is conducted using quantitative and qualitative designs. Questionnaires were distributed, and the results were measured using a 5-point Likert scale. The research population included 1,132 employees of the ikat weaving industry. Samples were selected using Slovin formula, resulting in the minimum samples of 175 employees. WarpPLS was employed to analyze the influences of variables mentioned in the research hypotheses. Knowledge obtained from external resources is expected to complete the available information in the organization. Knowledge sharing would be more meaningful and effective in supporting innovation. Even though knowledge sharing does not significantly influence the improvement of innovation, knowledge sharing is still essential to enhance stakeholders’ comprehension about the business in general and the detailed process of the business. Leaders’ creativity is an important dimension in obtaining and collecting various information from external resources as knowledge sharing has a significant influence on innovation through absorptive capacity. The research in Klungkung Regency is considered to represent Bali because it has the largest number of ikat weaving craftsmen. Knowledge and learning unique things should be maintained in order to enhance employees’ knowledge and comprehensions of new knowledge from external sources.

Creative Innovation through Knowledge Sharing and Absorptive Capacity