Intellectual and Social Capitals Development A Case in Malaysian’s ICT Companies

Noradiva Hamzah,Rosmah Mat Isa

doi:10.5539/ijbm.v5n1p53

Abstract

Intellectual capital is said to be a source of competitive advantage and there is evidence that business success can be partly explained by its intellectual capital. It is argued that the main dimensions of social capital of relevance to intellectual capital are structural, cognitive, and relational capitals because these, among other things, foster the exchange of knowledge and resources among the organization members. The objective of this paper is to investigate the importance of social capital in fostering the development of intellectual capital among the engineers. This study used case study method and data were collected through interviews. Data were analysed using within-case and cross-case analysis. The analysis shows that the most important dimension for intellectual capital development is structural capital. The findings also suggest that structural capital is a prerequisite of relational capital among engineers in an organizational project. The findings also demonstrate that frequent meetings and interactions, relationship, hierarchy or status, and shared language are among the factors that foster the sharing of knowledge among engineers. This study also elucidated that structural and relational capitals play important role in knowledge sharing and hence intellectual capital development.

Highlights

In a knowledge-based economy, the generation and exploitation of intellectual capital plays the predominant part in the creation of wealth
This study helps us understand the complex process in which outcomes expectation of social capital influence intellectual capital development among engineers
The results indicate that all social capital dimensions have a significant impact on the development of intellectual capital

Summary

Introduction

In a knowledge-based economy, the generation and exploitation of intellectual capital plays the predominant part in the creation of wealth. Tushman & Nadler (1986) suggest three critical factors in managing innovation: informal organization, organizational arrangement and individual. It is believed that the most flexible and innovative organizations are those which have effective learning system and those which could maximize both their abilities to acquire information about their customers, competitors and technology, and their abilities to digest that information. These three critical factors are similar to the three dimensions of intellectual capital (people, external, and internal) introduced by Bontis (1998); Sveiby (1997); Roos et al, (1997) and Stewart (1997)

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