Abstract
The research intended to investigate the effect of intellectual capital on the business performance of SMEs functioning in Penang Malaysia. The data were gathered through structured questionnaire survey forms. Participants for this study were selected through purposive sampling technique. In this study, 154 individuals were involved to test the six proposed research hypotheses. Multiple regression was used to examine the proposed research prepositions. The empirical findings expressed that four research hypotheses were supported and two hypotheses were not supported. The findings of this study reported that IC is very important for the success of SMEs. This study will provide awareness to SMEs to identify and capitalise their intellectual capital to get competitive advantages. This study will also provide guidelines to the policymakers. This study offers new avenues for future investigators to conduct their studies in various sectors to examine the impact of intellectual capital on performance of SMEs.
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