Today, Intellectual Capital plays a principal role in the delivery of corporate performance. This importance is reflected in the fact that companies, without the force of any regulations, start to produce intellectual capital statements to communicate their performance; accounting guidelines are being developed and standards are being questioned and reviewed; software companies such as SAP, Hyperion, Oracle, or Peoplesoft are developing applications to address this, and even governments are beginning to measure the intellectual capital of cities, regions, and countries. Accenture writes that today's economy depends on the ability of companies to create, capture, and leverage intellectual capital faster than the competition. Cap Gemini Ernst & Young believes that intangibles are the key drivers for competitive advantage. KPMG states that most general business risks derive from intangibles and organizations therefore need to manage their intangibles very carefully. PricewaterhouseCoopers writes that in a globalized world, the intellectual capital in any organization becomes essential and its correct distribution at all organizational levels requires the best strategy integrated solutions, processes and technology. Even though the leading management consulting firms recognize the importance of intellectual capital – they seem to suffer from the same predicament as the field as a whole. Intellectual capital is defined differently and the concept is often fuzzy. In this special issue of the leading journal in the field we would like to bring together the definitions, approaches, and tools offered by the leading management consulting firms. It will be a unique opportunity to disseminate your understanding of this critical area of management and allow you to illustrate your approaches and tools.
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In December of 2004 the Directorate General for Research and Technological Development (DG RTD) of the European Commission (EC) set up a High-Level Expert Group to propose a series of measures to stimulate the reporting of Intellectual Capital in research intensive Small and Medium-Sized Enterprises (SMEs). The Expert Group has focused on enterprises that either perform Research and Development (R&D), or use the results of R&D to innovate and has also considered the implications for the specialist R&D units of larger enterprises, dedicated Research & Technology Organizations and Universities. In this report the Expert Group presents its findings, leading to six recommendations to stimulate the reporting of Intellectual Capital in SMEs by raising awareness, improving reporting competencies, promoting the use of IC Reporting and facilitating standardization.
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In May 2007, our Centre for Research in Intellectual Capital hosted the International Congress on Intellectual Capital: The future of business navigation. The Congress – which took place in Haarlem, The Netherlands – was attended by more than 140 participants from 23 countries. Based on almost 70 papers, we designed a conference program that consisted of more than 90 sessions. This special issue is based on a selection of the best papers of our conference.
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The value of CUlTent organizations and industries is increasingly located in intangibles (human capital, structural capital and relational capital) and basically,knowledgehasbecomea factor of production and a main asset. This Intellectual Capital does not appear on balance sheets,but ultimately does have an enormous impact and is basic to match the requirements of knowledgeintensiveeconomiesin Asia and Europe.
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In 2004 the report Intellectual capital of the European Union was published (Andriessen and Stam, 2004). This report provided insight in the value of the intellectual capital of the 15 countries of the European Union, in relationship to the goals set by the European Council in March 2000. Since this report, the EU grew from 15 to 27 countries and the Lisbon goals were reformulated in 2005. The aim of this paper is to repeat the measurement of the intellectual capital (IC) of the enlarged European Union (EU) in relationship to the new Lisbon goals. In order to become the most competitive and dynamic knowledge-based economy, the EU decided to focus on “delivering stronger, lasting growth and creating more and better jobs” (CEC, 2005d, p.7). In this paper we translate this overall goal in 38 indicators. As the data was not available for all the new member states, we decided to limit our paper to the so-called EU-19. Based on our measurements we conclude that the EU-19 is still behind Japan and far behind the USA, however the EU is catching up as both Japan and the USA have considerably lower growth figures than the EU-19. From an IC perspective, the EU is geographically divided. The Nordic countries are still the best performing countries. The southern European countries and the new member states stay behind. However, as the new member states invest more in their IC, it might be expected that their positions will improve in the future. The aim of our paper was to measure the progress of the Lisbon Agenda for growth and jobs. Based on our measurements we conclude that the EU-19 is successful in terms of creating more and better jobs, but not successful in terms of delivering stronger, lasting growth.
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Metaphors are at the basis of our understanding of reality. Using the theory of metaphor developed by Lakoff and Johnson (1980, 1999) this paper analyses common metaphors used in the intellectual capital and knowledge management literatures. An analysis of key works by Davenport & Prusak (2000), Nonaka & Takeuchi (1995), and Stewart (1991) suggests that at least 95 percent of all statements about either knowledge or intellectual capital are based on metaphors. The paper analyses the two metaphors that form the basis for the concept of intellectual capital: ‘Knowledge as a Resource’ and ‘Knowledge as Capital’, both of which derive their foundations from the industrial age. The paper goes into some of the implications of these findings for the theory and practice of intellectual capital. Common metaphors used in conceptualising abstract phenomena in traditional management practices unconsciously reinforce the established social order. The paper concludes by asking whether we need new metaphors to better understand the mechanisms of the knowledge economy, hence allowing us to potentially change some of the more negative structural features of contemporary society.
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Purpose – To analyse common metaphors used in the intellectual capital (IC) and knowledge management literatures to conceptualise knowledge, in order to study the nature of the intellectual capital concept. Design/methodology/approach – A textual analysis methodology is used to analyse texts from The Knowledge-Creating Company by Nonaka and Takeuchi, Working Knowledge by Davenport and Prusak and “Brainpower” by Stewart, in order to identify underlying metaphors. Findings – Over 95 per cent of the statements about knowledge identified are based on some kind of metaphor. The two dominant metaphors that form the basis for the concept of intellectual capital are “knowledge as a resource” and “knowledge as capital”. Research limitations/implications – Metaphors highlight certain characteristics and ignore others, so the IC community should ask itself what characteristics of knowledge the “knowledge as a resource” and “knowledge as capital” metaphors ignore. Practical implications – Knowledge has no referent in the real world and requires metaphor to be defined, conceptualised, and acted upon. When using such metaphors we should become aware of their limitations as they steer us in certain directions and this may happen unconsciously. The paper concludes by asking whether we need new metaphors to better understand the mechanisms of the knowledge economy, hence allowing us to potentially change some of the more negative structural features of contemporary society. Originality/value – This paper is the first to highlight that intellectual capital is a metaphor and that the metaphorical nature of the concept has far reaching consequences.
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In today’s intellectual capital literature, we see a shift from identifying intangibles towards understanding the dynamics of value creation. As it is not clear what “dynamic” stands for, the aim of this explorative and conceptual paper is to contribute to a better understanding of the dynamic dimension of IC. Based on a review of the early IC literature, the dynamic dimension (or dynamics) of intellectual capital seems to refer to the logic that value creation is the product of interaction between different types of (intangible) resources. As the idea of value creation through combination of knowledge resources is closely related to the New Growth Theory (Romer, 1990, 1994), this paper explores the New Growth Theory and its implications for the dynamic dimension of intellectual capital. Based on the exploration of the New Growth Theory, a conceptual model is presented in which the elements that constitute the dynamic dimension of intellectual capital are integrated. These elements are ideas, things, the process of knowledge creation, the process of continuous innovation, and institutions. The main conclusion of this paper is that the concept of knowledge is more closely related to the dynamic dimension of IC, than the concept of intellectual capital. Therefore, further research would probably benefit from approaching this topic from a knowledge management point of view. It is suggested that further research should focus on exploring the metaphors that contribute to a better understanding of the dynamics of IC, on the contribution that ideas can make to increase the effectiveness of knowledge management, and finally on the institutional arrangements that support the process of knowledge creation and innovation.
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Purpose: Intellectual capital theory and practice predominantly focus on measuring and managing intangible assets. However, if we want to balance the intellectual capital books (Harvey and Lusch, 1999), we should recognize both intellectual assets and intellectual liabilities (Caddy, 2000). Therefore, the purpose of this article is to present a theoretical framework for measuring intellectual liabilities. Design: Identifying intangible liabilities is identifying the risk of decline and fall of organizations. One of the first extensive studies related to causes of decline and fall is Gibbon‟s Decline and Fall of the Roman Empire (Gibbon, 2003 [original publication 1776]). It seems as if the main lessons that were drawn from this study are also applicable to today‟s business environment. Therefore, the framework that is developed in this article is not only based on intellectual capital literature, but also on Gibbon‟s study into the causes of decline and fall of the Roman Empire. Findings: The findings are combined in a framework for measuring intellectual liabilities. The main distinction within the proposed framework is the distinction between internal and external liabilities. Internal liabilities refer to the causes of deterioration that arise from the sources of value creation within the organization. External liabilities refer to the causes of deterioration that come from outside and are beyond control of the organization. Originality: This article explores a relatively new topic (intellectual liabilities) from a perspective (historical sciences) that is hardly used in management science.
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Purpose To analyze differences between Western and Eastern cultures in the way they conceptualize knowledge and discuss the implications of these differences for a global intellectual capital (IC) theory and practice. Design/methodology/approach A systematic metaphor analysis of the concept of knowledge and IC is used to identify common Western conceptualizations of knowledge in IC literature. A review of philosophical and religious literature was done to identify knowledge conceptualizations in the main streams of Asian philosophy. Findings Fundamental differences were found in the way knowledge is conceptualized. In Western IC literature common metaphors for knowledge include knowledge as a thing and knowledge as capital. In Asian thought, knowledge is seen as unfolding truth based upon a unity of universe and human self and of knowledge and action. Research limitations/implications The research was performed on a limited sample of literature. More research is needed to identify how knowledge is conceptualized in the practice of doing business in Asia and to test the effects of introducing IC theories to Asian businessmen and managers. Practical implications Western conceptualizations of knowledge, embedded in terms like intellectual capital and knowledge management, can not be transferred to Asian business without considering the local view on knowledge. Asian conceptualizations of knowledge should play an important role in the further development of a knowledge-based theory and practice of the firm. Originality/value The paper is the first to explore differences in knowledge conceptualizations by analyzing the underlying metaphors that are used in Western IC literature and Asian philosophy.
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