Improving Performance of Customer Relationship Management through Applying Knowledge Management

Customer Relationship Management (CRM) and Knowledge Management (KM) have become especial and strategic keys in the current competitive environment for all companies.  The critical role of KM as the main determinant of the success of CRM has been the focal point of the previous researches; the present paper aimed at studying the impact of different KM factors- such as Customer Knowledge (CK), Staff Knowledge (SK), and Market Knowledge (MK)-on CRM.  The data collection is done through participation of 113 experts in selected banks and through applying Structure Equation Modeling (SEM) and Factor Analysis the relationships between KM and selected parts of CRM improvement is examined. The Privatization in Iran has already affected the state banks in some areas such as competitiveness, customers, and reputation; therefore, it would be necessary to find a way to reduce this competitive gap in the banking sector. The findings of the present study indicated that the KM capabilities, which proved to be effective in more than 60% of the selected parts, could not be taken as the only factors contributing to CRM improvement; this is why   KM factor can lead to improvement in CRM sub modules such as Service Management, Complain Management and Suggestion Management.