Vol 24, No 2; Article by Sourav Mukherji; June 2012
To be effective and sustainable, an organisation's knowledge management initiatives must be directly linked to its strategic objectives. This paper focuses on management of customer knowledge in the retail industry, because customer knowledge can be a rich source for product information, competitive intelligence and consumer behaviour. While retail operations generate transactional data, i.e., data about what customers purchase, existing tools and technologies do not adequately capture interactional data that could provide insights on what customers know, think and feel. Such interactional data can only be captured through people-to-people connections or socialisation, an expensive process needing both demand and supply side incentives. Therefore retailers need to understand the business contingencies for managing transactional and interactional data such that the benefits are commensurate with the costs. In this paper we develop a decision making framework based on two dimensions of consumer behaviour, consumer involvement with purchase and frequency of purchase, to identify three critical components of customer knowledge management systems in the retail industry. These are a repository of transactional data comprising explicit knowledge that can be used for mass customisation of products, a bank of interactive data, rich in tacit content, that can be leveraged to capture customer insights for fuelling innovation and collaborative platforms that can create customer communities of practice. The challenges of creating and sustaining each of these components and their potential benefits are discussed. Thus, the framework developed should enable retailers to decide, based on nature of their product, which components of customer knowledge management they should focus on to derive maximum business benefits.
