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Purpose The purpose of this paper is to theoretically broaden the knowledge-based view (KBV) by examining the significant intermediary role that inter-functional coordination (IFC) plays in acquiring new knowledge and exploiting it throughout the entire higher education institution (HEI) community for innovation generation (INNG). Design/methodology/approach Data collected from a survey of 282 lecturers purposively selected from the business schools of 20 HEIs in the Greater Accra region of Ghana was analyzed using partial least squares structural equation model to test the hypotheses proposed for the study. Findings The results revealed that IFC significantly predicts teamwork and strong relationships across faculties, departments and units, and has a positive effect on the generation of innovations such as improved curricula, enhanced academic instruction and quality research output. Practically, the findings advise HEI managers to invest resources and efforts at building strong relationships that facilitate collaboration, trust and interactions among varying faculties, departments and units. This will enhance inter-functional knowledge sharing in academia to sustain a competitive advantage and continued relevance. Research limitations/implications There are limitations that must be considered when interpreting and generalizing the quantitative results of this study. Data were collected from faculty staff of 20 public and private HEIs in the Greater Accra region of Ghana. Although the majority of HEIs are clustered in this region, the results may still not be representative of all HEIs in Ghana. Practical implications Managers of HEIs are advised to commit to ensuring the management of IFC to promote knowledge sharing across faculties and departments. Managers are also advised to ensure that staff are made to be responsible for their cooperative and integrative teamwork. They are also advised to ensure that faculty and departmental goals are aligned with the overall goals of the university. Staff may also be encouraged to act as partners and not just employees through rewards, incentives and recognition packages. Social implications Attention should be focused on creating lateral relations among faculty and department members to achieve internal social capital. They are advised to invest resources and efforts in building a culture of teamwork and connectedness through strong informal networking that facilitate collaboration between faculties and departments while cultivating a shared vision throughout the university. Originality/value The main contribution of this paper is that it theoretically extends the KBV by empirically broadening the scope of absorptive capacity (ACAP) beyond its dimensions to include the “collaborative mechanism” (IFC) through which knowledge can be holistically exploited. The paper also contributes to existing literature by examining the intermediary role played by IFC in the relationship between ACAP and INNG in the HEIs domain which has been least discussed in the ACAP literature.