Customer knowledge management in SMEs: Review and research agenda

• Date: 01 January 2021
• DOI: http://doi.org/10.1002/kpm.1653
• Published date: 01 January 2021
• Author: Pornthip Chaithanapat,Sirisuhk Rakthin

RESEARCH ARTICLE

Customer knowledge management in SMEs: Review and

research agenda

Pornthip Chaithanapat | Sirisuhk Rakthin

College of Management, Mahidol University,

Bangkok, Thailand

Correspondence

Sirisuhk Rakthin, College of Management,

Mahidol University, 69 Vipawadee Rangsit

Road, Samsennai, Phayathai, Bangkok 10400,

Thailand.

Email: sirisuhk.rak@mahidol.ac.th

Customer knowledge is one of the most noteworthy assets for firms to manage in

order to improve their products and gain competitive advantage while meeting the

customer needs. Customer knowledge management (CKM) arises when firms see the

significance of customers as a source of firm's knowledge. More importantly, cus-

tomers alter from passive product receiver into active knowledge partners and gener-

ate co-created knowledge with firms. However, despite the popularity of promoting

entrepreneurship and small and medium enterprises (SMEs) for economic develop-

ment, research studies, examining CKM in the context of SMEs, are relatively small

and diverse. In this paper, the authors discuss the concept of CKM from a compre-

hensive literature review as well as other related concepts that are anticipated to

have relationships with CKM in SMEs, namely knowledge-oriented leadership (KOL),

trust in management, and firm performance. A thorough analysis of past research

confirms that the existing literature in this area is highly fragmented. By integrating

the main findings of relevant research streams, a detailed overview of the literature

on CKM in the context of SMEs is established, and a research agenda is set up.

1|INTRODUCTION

Due to the change from industrial revolution to knowledge revolution,

firms today tend to emphasize knowledge as a key factor in success.

Knowledge has become one of the chief assets that firms can possess

to achieve not only a competitive advantage but also continuous

improvements and other benefits in the long run. To achieve a com-

petitive advantage, firms must identify and capture customer

knowledge.

Since knowledge is considered as one of the most noteworthy

assets for firms today to manage, they need to manage not only rudi-

mentary knowledge but also customer knowledge. This not only helps

firms to be able to improve their products and services but also helps

firms emphasize the importance of meeting the needs of their cus-

tomers. Many scholars place the importance of knowledge resources

at the strategic forefront, and knowledge resources are claimed to be

the only factor for firms to differentiate themselves from their com-

petitors (Drucker, 1964; Wilhelm, Gueldenberg, & Güttel, 2013).

Du Plessis and Boon (2004) have suggested that understanding the

needs, demands, and behaviors of customers could be gained through

the integration of knowledge management (KM) and customer rela-

tionship management (CRM), which is also known as customer knowl-

edge management (CKM). The concept of CKM is encouraged when

firms see the significance of customers as a source of the firm's

knowledge. In this way, the implementation of CKM emerges when

firms can change their customers from passive product receivers to

active knowledge partners and generate co-created knowledge, which

is critically important (Gibbert, Leibold, & Probst, 2002; Wilhelm

et al., 2013).

According to the Office of Small and Medium Enterprises Promo-

tion (OSMEP) (2017), SMEs accounted for 99.70% of all companies in

Thailand and employed 78.48% of the total employment in 2016.

They play a significant role in the economy, both in terms of employ-

ment and GDP, where they produced 42.5% of the country's GDP

in 2017 (OSMEP, 2017). To survive and grow sustainably in this

competitive business era, firms must invest in knowledge rather than

in any other resource (Fidel, Schlesinger, & Emilo, 2018; Pil &

Holweg, 2003).

Since customer knowledge alone is not sufficient for a firm to

gain competitive advantage, this paper will discuss CKM and other

Received: 6 August 2020 Accepted: 16 September 2020

DOI: 10.1002/kpm.1653

Knowl Process Manag. 2021;28:71–89. wileyonlinelibrary.com/journal/kpm © 2020 John Wiley & Sons Ltd 71

related variables that influence the performance of firms like

knowledge-oriented leadership (KOL) and trust in management. This

paper is divided into three sections, which include an introduction and

a comprehensive literature review of four main terms: CKM, KOL, firm

performance, and trust in management. Furthermore, this paper will

review the antecedents, outcomes, and challenges of CKM, the

research gap, direction for future research, and proposed conceptual

model.

To build comprehensive literature of CKM, several steps have

been taken to manage the scope of the review and assure a consistent

range of related studies in the sample. First, 216 papers were found

when the term “customer knowledge management”was typed into

the electronic database, SCOPUS, while limiting to studies from 2001

onward. Next, the author limited the source type to journals; there-

fore, conference proceedings, books, and book series were excluded,

resulting in 107 papers. In the third step, the author also excluded

document types: review, an article in press, and conference papers;

the author kept only published journal articles, which resulted in

97 articles in this step. The author further excluded two papers that

are not related to CKM in the subject area of Chemical Engineering

and Medicine; the author ended up with 95 articles in total. Although

95 papers on CKM are relatively high, this paper focuses on the

recent (from 2001 onward) and most cited papers.

The author investigated the term “knowledge-oriented leader-

ship”in SCOPUS and followed the same steps as done in CKM; the

author found nine papers containing either one of these terms. How-

ever, when both terms were searched together with a Boolean

“AND,”only five papers were found.

2|LITERATURE REVIEW

2.1 |Introduction

2.1.1 |Theoretical background

Based on the traditional resource-based theory, many past studies

claimed that firms with better market orientation will result in better

performance since they know what their customers want and need,

the competencies and strategies of their competitors, room for

improvement, and about the industry as a whole (Hult & Ketchen

Jr., 2001; Jaworski & Kohli, 1993; Morgan, Vorhies, & Mason, 2009).

The resource-based theory provides a complete view of how firms

utilize their resources and their ability to create basic production

needs, to produce products and services, and to sell those products

and services (Young, Bell, & Crick, 2000). The theory also explains

how a firm can outperform its competitors by “pulling”its resources

to improve performance (Barney, 1991; Wernerfelt, 1984). The

resource-based theory proposes that these strategic resources will

assist firms in carrying out strategies to achieve a competitive

advantage.

Based on the knowledge-based theory, Grant (1996) suggested

that, among various resources, knowledge is the most valuable

strategic resource that a firm possesses. Following the theoretical

background, this study considers CKM as a strategic resource for

SMEs to achieve a competitive advantage since it can create value for

the firm and customers (Gibbert et al., 2002). As a result of the occa-

sional lack of human capital in SMEs and limitations in existing knowl-

edge, SMEs sometimes commit to obtain knowledge externally

(Desouza & Awazu, 2005; Robson & Bennett, 2000).

2.1.2 |Knowledge

Knowledge is considered the new capital and an important asset for

firms to manage since knowledge can improve the performance of a

business and create a competitive advantage. Drucker (1992) claimed

that knowledge is possibly the only sustainable source for a firm's

competitive advantage. The main difference between information and

knowledge is that knowledge lies in the use of information; mean-

while, knowledge is the information that people use (Nonaka &

Konno, 1998). Binney (2001) investigated the instruments that busi-

nesses can use to systematically organize knowledge and suggested

knowledge map, decision table, decision tree, case-based technology,

data mining, CRM, total quality management (TQM), business intelli-

gence, benchmarking, and portal as some examples. So far, no general

agreement in defining knowledge exists. According to one point of

view, knowledge is seen and treated as an entity or object embedded

in a firm's regulation; knowledge is distinguished from information

through its functional differences (Tzortzaki & Mihiotis, 2014).

Nonaka (1994), a leading KM expert, viewed knowledge as beliefs,

commitment, viewpoints, purpose, and action, and connected knowl-

edge directly to the values of the company and commitment of

employees, while he viewed information as only a flow of messages.

Dretske (1981) defined information as a commodity that can yield

knowledge while the author can learn from what information carries.

Davenport and Prusak (1998) defined knowledge and information

as a combination of past experiences, personal values and information

in context, and opinions of experts. These factors altogether create a

base to evaluate the accumulation of novel experiences and informa-

tion. Brooking (1996) defined knowledge as information depending on

the action taken, data available, and evidence. Many taxonomies have

been created for knowledge in the past decades. Popular terms from

The Knowledge-Creating Company by Nonaka and Takeuchi (1995)

have been used widely in other KM studies; other popular terms used

are tacit (implicit) knowledge and explicit (or articulable) knowledge

where both are complementary.

2.1.3 |Customer knowledge

Customers can be one of the greatest external sources of knowledge

for firms. To gain a competitive advantage, firms must be able to see

the importance of new knowledge from external sources like cus-

tomers. For Cohen and Levinthal (1990), the competency to gain

knowledge from external sources is known as “absorptive capacity”.

72 CHAITHANAPAT AND RAKTHIN