Academic journal article Journal of Management and Organization

The Impact of Customer Knowledge Capability and Relational Capability on New Service Development Performance: The Case of Health Service

Academic journal article Journal of Management and Organization

The Impact of Customer Knowledge Capability and Relational Capability on New Service Development Performance: The Case of Health Service

Article excerpt

Abstract: This study intends to explore the impact of the customer knowledge integration capability, customer knowledge absorptive capability, customer knowledge creation capability, and customer relationship capability on new service development (NSD) performance for Taiwan's hospitals from customer knowledge and customer relationship perspectives. We employ the self-administered mail survey to collect research data and select self-pay medical service managers or top managers as key informants. After testing the fitness of sample representativeness, non-response error, common method variance, reliability, and validity, we adopt structure equation model to test the research model. Empirical results indicate the customer knowledge absorptive capability of a hospital is positively associated with NSD performance, and the customer knowledge integration capability of a hospital fully mediates the relationship between customer knowledge absorptive capability and NSD performance. However, customer relationship capability and customer knowledge absorptive capability both have positive influence on customer knowledge creation capability. Managerial and theoretical implications are discussed.

Keywords: new service development, customer relationship, customer knowledge, knowledge integration, knowledge creation, health services

For knowledge-intensive organizations, service innovation has been the critical pathway to strengthening the competitive advantages of service organizations (Nijssen, Hillebrand, Patrick, & Vermeulen, 2006). The process of providing medical service is highly knowledge-intensive and must combine medicine, nursing, administration and other relevant knowledge. The hospital is typically a kind of highly knowledge-intensive organization (Adler, 2003). Recently, because of the increase of competition in the hospital industry, hospitals must actively promote new medical service development to strengthen competitive advantages (Berwick, 2003; Lonial, Tarim, Tatoglu, Zaim, & Zaim, 2008). Although new service development (NSD) has become an important direction, NSD performance does not always come up to managers' expectations (Ottenbacher, Gnoth, & Jones, 2006). For this reason, it is necessary to explore factors affecting NSD performance in the hospital industry.

From a knowledge-based perspective, knowledge and knowledge capability are the important sources of innovation development (Nielsen, 2005). Organizations must have sufficient abilities to absorb, integrate and create various kinds of knowledge to promote NSD and then create a high knowledge-based economy. NSD is the process of transforming embedded knowledge into embodied knowledge. During this process, the acquisition and utilization of external knowledge flow are the critical determinants of NSD success (Lonial et al., 2008) and customer knowledge is the most important one of external knowledge in an organization (Claycomb, Dröge, & Germain, 2005). By acquiring and applying customer knowledge, organizations can ascertain customers' needs and then develop new products or services to satisfy customers (Joshi & Sharma, 2004). Furthermore, organizations also could effectively exploit market opportunities to create advantageous new services through the utilization of customer knowledge (Cano, Carrillat, & Jaramillo, 2004).

To accumulate customer knowledge efficiently, organizations must have a good knowledge capability (Su, Chen, & Sha, 2006). The most important three knowledge capabilities relevant to knowledge accumulation and NSD involve knowledge integration capability (de Boer, van den Bosch, & Volberda, 1999; Grant, 1996), knowledge absorptive capacity (Cohen & Levinthal, 1990; Tsai, 2001) and knowledge creation capability (Nonaka & Takeuchi, 1995; Smith, Collins, & Clark, 2005). In addition, if organizations can establish good relationships with their customers, customers will be more likely to interact with organizations. …

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