Fundamental Theorem of Exchange is one of the most important principles of economics. It states "trade is mutually beneficial. Voluntary exchange increases [net benefits] for all parties involved." (Hirshleifer et al., 1998) In microeconomics, the maximum price a buyer is willing to pay for a good or service, or the minimum price a seller is willing to accept in exchange for a good or service is called reservation price. Buyer (or consumer) surplus, which is the difference between a buyer's reservation price and the actual price paid, is a measure of how much better off the buyer is from buying a good or service at a price below his reservation price. Seller (or producer) surplus, which is the difference between a seller's reservation price and the actual price paid, is a measure of how much better off the seller is from selling a good or service at a price above her reservation price. The buyer voluntarily exchanges cash for a good or service when he can enjoy his surplus net benefits. The seller voluntarily exchanges a good or service for cash when she can enjoy her surplus benefits. Markets, which bring buyers and sellers together, facilitate these exchanges by greatly reducing the cost of seeking a buyer of one's product or a seller of what one desires (http://my.ilstu.edu).
Conventional wisdom would suggest that the advances in information technology, the Internet and worldwide web create greater competition in the markets, where the free flow of information permits buyers to search competing sellers with dramatically reduced cost. Grover et al. (1999) argue that the infusion of powerful information networks into business environments began to have a profound impact on the nature of governance between consumers and suppliers in the marketplaces. The networked world allows a large, growing number of suppliers to connect and interact with a large, growing number of buyers. Therefore, suppliers can beneficial themselves to survive intense competition in markets.
Competition is all about creating values and capturing values (Hunting Dragons). Supply chain, which is a network of interconnected businesses involved in providing goods and services to customers, has become increasingly market-oriented. The primary driver of the value chain has been transformed from supply to demand (Chen et at. , 2009). Value chain refers to a high-level model of how businesses receive raw materials as input, add value to the raw materials through various processes, and sell finished products to customers. Businesses realized that the only performance outcomes that matter are the ones the customers really care about. Companies have been customizing and growing their customer value propositions around what the customers really need rather than what they want to sell to customers (BMA, 2003). However, in the emphasis on customer knowledge as a key competitive factor in the global economy, companies may explore and manage knowledge about customers but overlook knowledge resided in customers. By managing the knowledge of their customers correctly, businesses are more likely to sense emerging market trends and opportunities before their competitors do.
The competition in the new economy is getting tougher and the rules of the game in the business world are changing so radical that only the most adaptive, swift, and agile companies will survive. Thomas et al. (2004) call this phenomenon 'hyper-competition'. In the hyper-competition environment, businesses must move quickly to build new advantages while simultaneously destroy the advantages of their rivals Businesses have recently started implementing social networks such as blogs and wikis, as well as web sites like Facebook, MySpace and Twitter in exploring and managing customer knowledge assets. Companies use social networks to organize internal and external communications. Social networks allow businesses to create virtual communities of Internet for interests of current and potential customers to interact with each other and share information and knowledge about the companies' products and services.
Knowledge@Emory (2004) points out that hypercompetition is reshaping the way companies do business because in the hyper-competition context, competitive advantages tend to be short-lived. L.G. Thomas says, "Achieving and sustaining a competitive advantage may mean that the best strategies for winning will be short-term and constantly revised." Based on the recent development in the economy and information technology (IT), this paper will revise and update the conceptual framework for knowledge management (KM) proposed by Su et al. (2005) into a framework for customer knowledge management (CKM).
REVISION OF THE RPP FRAMEWORK
Sue et al. (2005) proposed a conceptual framework for exploring the relationship between resource provision and knowledge management process, and the relationship between knowledge management process and customer knowledge base performance. The framework also explores the possibility of improving customer knowledge management performance through enhancing employees' understanding of their corporate mission and vision. The original RPP conceptual framework is presented in Figure 1 and the revised RPP framework is presented in Figure 2.
[FIGURE 1 OMITTED]
[FIGURE 2 OMITTED]
In the original RPP conceptual framework, the dimension of resource provision consists of two major important resource inputs for successful corporate knowledge management: 'incentives" and 'organizationally supported technology'. The dimension of knowledge management process comprises four steps: (1) knowledge define; (2) knowledge capture, select and store; (3) knowledge share; and (4) knowledge apply, create and sell...
Hypercopetition, customer knowledge, social networks and sustainability.
To continue readingREQUEST YOUR TRIAL
COPYRIGHT TV Trade Media, Inc.
COPYRIGHT GALE, Cengage Learning. All rights reserved.
COPYRIGHT GALE, Cengage Learning. All rights reserved.