Skip to Content

Knowledge Management in CRM

With the advancement of technology and growing customer demands, the differences between KM and CRM are blurring. In this post, I shall try to discuss a case for the importance of KM in CRM for organizational success.

The Case for Knowledge Management in CRM

There was a time, when CRM, KM, E-Business (Service, Sales and Marketing) all had different roles to perform and different objectives to meet.


Customer Relationship Management (CRM)

CRM was designed to be a customer-centric model that would support the three phases of a seller/buyer relationship: new customer acquisition, retention of existing customers and lifetime value maximisation – essentially: Marketing, Sales & Service.


Click to Enlarge


However, For CRM to be successful it has to become an ethos, the very culture itself; strategy and appropriate technology alone are not enough. A truly customer focused company concentrates all efforts on satisfying profitable customers, acquiring and retaining these customers and growing long-term revenues from them.


CRM Objective

Click to Enlarge




Knowledge Management (KM)

By definition, Knowledge Management is a cycle of gathering knowledge, organizing it, sharing it, and accessing it.

KM Cycle
Click to Enlarge


Historically, KM has been associated with exploiting the internal assets of an organization – the people and processes.

KM people processes
Cick to Enlarge


It is, however, the knowledge and understanding of all stakeholders (customers, suppliers, employees, partners, etc) that is really the key to differentiation and competitiveness.

Click to Enlarge



The Case for KM in CRM

Gearing towards next-generation Enterprise applications, the terms KM, CRM and e-business have become more-or-less interchangeable. Besides, with B2B and B2C interactions realizing greater sophistication levels, the boundaries between KM and CRM will become more blurred. Or, so to say, the case for Knowledge Management in CRM shall become stronger and more and more inevitable. Some of the reasons for KM in CRM are cited below :

  • Customers are now demanding & expecting bigger bargains, better products & faster service on a personalized scale. – CRM approaches alone cannot take care of providing such high-level of personalization.
  • Combining customer knowledge with CRM enables organizations to target customers with high life time / strategic value; thus leading to future growth opportunities.
  • Customer intimacy and knowledge of industry-specific processes tailored to meet business needs are essential ingredients of organizational success.
  • Organizations must formulate a dynamic corporate buying and selling model such that customers receive optimum results based on the combination of suppliers, services & processes, most appropriate to their own business model & vertical industry.
  • To achieve this dynamism, organizations must have fast and easy access to information about its own business operations, its customers & their vertical processes & business models – the forte of Knowledge Management
  • Managing this extended enterprise-knowledge in a customized manner by applying knowledge relevant to particular verticals, shall be the differentiating factor for on-line intermediaries – the opportunity for E-business providers.


KM supplies the knowledge that defines how a business operates, and CRM defines the nature of each customer interaction. Thus we realize that CRM or KM alone cannot handle the growing demands of a customer-centric industry – a balanced blend of both disciplines shall enable organizations to mold all aspects of their business for effectiveness of each customer relationship.




  1. The formula for a successful business – Susan Colling
  2. Know thy customer, know thyself – Peter Dorrington
  3. CRM is not a plug-in – Gideon Davenport
You must be Logged on to comment or reply to a post.
  • Hi Debolina,

    In one of the picture it says "Exploiting People & Process", while describing KM. I must correct you on this very statement that KM is not Exploiting!!!! It is, on the contrary, making better use of the existing knowledge within the Organisation which can be achieved by the collective effort of "employees" within and with a framework called "Process".

    I am not too sure whether these are your own words or googled from somewhere, nevertheless the word "Exploitation" suggest something else and hence should have better been avoided.


    • Hi Harshit,

      Thanks for the feedback... the word "exploitation" was not meant to be used with a negative connotation... nevetheless, I understand that we have to be careful with the choice of words.

      More feedback awaited 🙂

      Thanks & Regards,

  • Hi, Harshit,
    For the selection of word "Exploitation" I am supporting and agree with Deboleena. That is the appropriate word. In my opinion, meaning of exploit in such cases should be taken as fully utilizing the capabilities.