The notion of sustainability is most important phenomena in the modern world as changes are noticed in the business models due to knowledge management systems. This article gives an analysis of the link between knowledge management and sustainable development of small and medium business enterprises. This research is quantitative research study and the data was collected randomly from 75 small to medium enterprises in the hospitality industry. A standardized questionnaire was used to gather information from hoteliers. Regression and correlation of the variable was used to analyze the relationship of sustainable development and knowledge management.

The findings are also very useful in understanding knowledge management system in relation to sustainable business of small businesses. Moreover, the research identified the roles played by human resources management in implementing knowledge management programs for employees. Furthermore, the study reviewed that sustainable development of small business is determined by the knowledge acquired, sharing, experiences, resource utilization, competences, and societal cohesion. Individuals’ capacity to harness the ideology of sustainable development depends with understanding the aspect of sustainable development dimensions which consists of social process of learning, personal experiences and knowledge.

Hospitality business that adopted the idea of embracing the concept of applying knowledge management systems and processes in small business requires some elements of applying principles of sustainable development to enhance sustainable competitive advantage. Moreover, providing information about the importance of concentrating on knowledge management system in small business facilitated sustainable development of society through managing viable business that value all stakeholders.

The study has a significant effect to the development of viable small and medium enterprises model that are sustainable in nature through harnessing knowledge management practices which embrace some changes in business operations, customers’ preferences and experiences. Practically, small hospitality businesses require more knowledge management processes that ensures continuous satisfaction of customers in order to achieve sustainable business operations.