Integrating intellectual capital across supply chains: an innovation perspective

Abstract

This paper studies the relationship between integration of buyer-seller intellectual capital and innovation performance. It hypothesises and tests the extent to which similarity in the organisational and human capital held by buyer-seller firms helps in this integration enhancing radical and incremental innovation amidst the relational capital and power present in the supply chain. The paper introduces two new constructs: organisational capital similarity and human capital similarity. Hypotheses were tested using data from a web-administered survey of purchasing managers in Canada. Results indicate that the management of intellectual capital to drive incremental and radical innovation in supply chains should focus on building organisational capital similarity and human capital similarity respectively. Power exercise decreases radical innovation while not impacting incremental innovation; and relational capital increases both forms of innovation. Neither relational capital nor power moderated the effect of organisational and human capital similarity on incremental and radical innovation respectively.