Managing knowledge to create customer service value

Purpose – The purpose of this paper is to contribute to the services management literature by identifying a sequence of the different processes of knowledge management (KM) to create customer service value. Design/methodology/approach – The context for the research hypotheses is the Spanish banking industry. The authors conducted a study including 76 banks and 1,832 customers of these banks. This paper uses the partial least squares method to conduct the data analysis. Findings – The authors find support for all the hypotheses proposed in the model. The results show that service firms that are able to apply more knowledge or apply knowledge more effectively are likely to generate more benefits for their customers, and/or reduce their sacrifices, contributing significantly to a higher perception of service value. Research limitations/implications – The study focusses on one particular industry in a single point in time. A longitudinal analysis of a variety of service industries would enrich the study. Practical implications – It is argued that KM constitutes a key capability for service firms for the delivery of service value. According to the research, if service firms want to improve the application of knowledge, it is important to focus on knowledge retention while they create new knowledge. Originality/value – Although a considerable amount of research has been carried out in the fields of KM and customer value, there has been less research that has taken both into consideration simultaneously. This paper addresses this gap in the literature.