In an era where agility and innovation are paramount for success, a new study by University of South Carolina Department of Retailing Assistant Professor Md. Rafiqul Islam Rana delves into the significance of knowledge management capabilities (KMCs) within the fashion retail sector. This research, co-authored by Assistant Professor Song-yi Youn of the University of Missouri, provides fresh insights into how effectively managing knowledge can enhance competitive advantage and organizational performance, particularly amid the complexities of fashion products.
The study explores the intricate relationship between KMCs and the success of fashion retailers by analyzing survey data from 322 U.S. fashion retail professionals. The researchers utilized partial least squares structural equation modeling (PLS-SEM) to draw their conclusions.
"We hope this research encourages fashion retailers to look inward at how they manage organizational knowledge," Rana says. "Given the inherent complexity of fashion products, this study emphasizes the need to prioritize building a strong knowledge infrastructure — a culture of learning, collaborative structures, and enabling technology. With that foundation, they can effectively leverage insights around consumer data, trends, product feedback, design innovation geared toward complex products, sustainable sourcing practices, and targeted marketing strategies. Optimizing these knowledge capabilities allows retailers to better navigate product complexity while staying agile, innovative and driving peak performance in today's competitive landscape."
One pivotal finding of the study is the significant role of knowledge infrastructure capabilities (culture, structure, and technology) in boosting both competitive advantage and organizational performance. The results clearly indicate that having a robust knowledge infrastructure is crucial for fashion retailers looking to stay ahead in a highly competitive market.
On the other hand, knowledge process capabilities (acquisition, conversion, application, and protection) did not show a significant direct impact on competitive advantage but was found to improve organizational performance. This highlights that while the processes of managing knowledge may not directly influence competitive standing, they are vital for overall organizational efficiency and effectiveness.
Finally, the research examines the moderating effect of product complexity on the relationship between competitive advantage and organizational performance. The study found that higher product complexity negatively impacted this relationship. Fashion products inherently come with a level of complexity that can hinder the direct benefits of competitive advantage on performance. This complexity requires retailers to strategically enhance their knowledge management practices.
This research stands out by highlighting the interplay between product complexity and KMC in the fashion retail industry. It offers valuable insights that are beneficial for both academia and industry practitioners, adding a novel dimension to the existing body of knowledge by examining how product complexity influences the effectiveness of knowledge management strategies.
As the fashion industry continues to evolve, the findings of this study underscore the critical importance of knowledge management capabilities. By leveraging these insights, fashion retailers can better navigate the complexities of their products and the competitive landscape, ensuring sustained success and performance.
The full paper, published in the International Journal of Retail & Distribution Management, is available online.