Abstract
The purpose of this paper is to contribute to the Intellectual Capital Accounting (ICA) literature by investigating the barriers to IC measurement and how they can (re)shape IC measurement projects. The paper presents an interventionist case study of a company which has been measuring its IC for several years. It focuses on some emblematic situations in which barriers arose during the design and implementation of IC indicators followed by a (re)moulding of the IC measurement project within the organization. The case analysis revealed two barriers: the heavy workload that the design and calculation process of IC indicators entails and the perceived limited reliability of those indicators. These barriers did not lead to a complete failure of the project, but acted as a “filter”, resulting in the discontinued use of those indicators that were not perceived as useful or reliable and in the adoption of those that the managers actually considered useful. While this hindered a complete implementation of the ICMS, it promoted a selection of IC indicators and a legitimation of those that subsequently became part of the management control system. While previous studies explore how barriers can hamper the design as well as the implementation of an ICMS, this paper sheds light on what happens to IC measurement projects when the magnitude of barriers is not so significant as to lead to the complete failure of the project. This offers a new and different view of the barriers related to the adoption of ICMSs. Rather than considering them as factors which can interrupt IC measurement, they could be seen as factors which can challenge the implementation of the ICMS, strengthening those IC indicators that are perceived as reliable and useful and eliminating or disregarding those that did not meet expectations.
Highlights
The development of the knowledge‐based economy has meant that a company’s degree of competitiveness depends more and more on the management of Intellectual Capital (IC) elements rather than on physical and financial assets (Edvinsson, 2013; Roos, 2017)
This paper has presented a case in which some barriers arose during the design and the implementation of IC indicators in order to explore the effects they had on the IC measurement project
The case analysis has revealed that getting an IC measurement project up and running in this company was quite difficult
Summary
The development of the knowledge‐based economy has meant that a company’s degree of competitiveness depends more and more on the management of Intellectual Capital (IC) elements rather than on physical and financial assets (Edvinsson, 2013; Roos, 2017). 71), several frameworks to measure IC have been proposed over the years, the aim being to encourage companies to adopt IC management practices by promoting the adoption of narratives and indicators on IC (Meritum Project, 2002; Mouritsen et al, 2003; Andriessen, 2004; FMEL, 2004; European Commission, 2008; Sveiby, 2010). Along these same lines, a specific research stream arose within the IC discourse, that of Intellectual Capital Accounting (ICA), defined by Guthrie et al One of the current aims of ICA research is to explore the levers and the barriers to their adoption and use (Guthrie et al, 2012; Dumay, 2013; Dumay, 2014), in order to shed light on how and why successful (or unsuccessful) experiences occur (Dumay, 2012, p. 12)
Sign-in/Register to view highlights & summary Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
