Firms generate new knowledge that leads to innovations by recombining existing knowledge sources. A successful recombination depends on the availability of a knowledge stock (human capital pool) and the flow of knowledge within the firm (induced by HRM systems). While human resource theory expects complementarities between human capital pools and HRM systems, it does not explicitly address how knowledge exchange may be guaranteed or fostered. Moreover, empirical approaches neglect the complexity of such complementarities. In this study we develop a model that integrates a firm’s knowledge stock and flow into a knowledge creation (KC) system comprising four ideal types. This system explains the occurrence of superior incremental innovation performance. We empirically analyze the KC system by applying fuzzy set qualitative comparative analysis (fsQCA) and identify configurations concurring with our ideal types. The results show that the use of human capital and HRM practices depends on firm size and industry dynamism.