Do knowledge management and Key customer-focused enhances banks' performance and competitive advantage in Ethiopia?

Abstract The study explores how customer-focused strategies and efficient knowledge management methods of banks contribute to competitive advantage and eventually influence bank performance, drawing upon the resource-based view and customer association management theories. Data was gathered from a sample of commercial banks of Ethiopia in Dilla district through questionnaires utilizing a quantitative research approach, and structural equation modeling techniques were used for analysis. The findings demonstrated that Knowledge Management significantly and favorably affected Competitive Advantage, highlighting the need of efficiently managing knowledge assets. Nevertheless, it was discovered that there was no statistically significant association among Key Customer Focus/ Knowledge Management and Bank Performance and the mediating impacts of Competitive Advantage. Furthermore, investing into knowledge management techniques and encouraging a culture of learning may help banks become more innovative, streamline operations, and adapt to shifting market conditions.