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The paradigm shift to a knowledge economy, predicted by Drucker, is currently reflected in a knowing-to-doing gap in healthcare, potentially threatening the lives of long-term care (LTC) residents and sustainability of LTC organizations. The purpose of this grounded theory study was to seek a substantive conceptual theory to explain how LTC uses knowledge management (KM) to improve performance by probing the a priori views and lived experiences of 11 LTC knowledge creators, managers, and users. Data were collected via semi structured interviews that were transcribed and coded. The research questions guided by the conceptual concentrated on how KM is used in LTC, what KM processes enhance or inhibit performance in LTC, the nature of knowledge in LTC, and the potential impact of Deming's theory of profound knowledge on KM in LTC. Data analysis included coding, categorizing, constant comparison, conceptualizing, and theorizing to reveal a tentative unified theory of crafting a system of KM in LTC that theoretically extends Deming's organizational theory of profound knowledge to integrate the individual knower within Deming's organizational perspectives. Findings included participant use of sentinel data and bridging decisions in response to emergent knowledge needs, risk management versus quality management performance drivers, and participant perceptions of resource dependence in response to emergent knowledge needs. Findings also include social change implications for LTC facilities, residents, and staff driven by systematic KM to facilitate clinical best practices, lessons learned, and resourcing the use of knowledge to enhance LTC performance capabilities. Study conclusions include a call for future research related to study findings across the healthcare continuum.