The impact of intellectual capital on innovation generation and adoption

Abstract

PurposeThe purpose of this paper is to measure the separate and interrelated effects of three aspects of intellectual capital (human, social and organizational capital) on innovation generation and adoption.Design/methodology/approachData were collected from 318 respondents’ of chemical firms. This study used multiple regression analysis to analyze the influence of human, organizational and social capital on innovation generation and adoption.FindingsResults suggest that organizational capital exerts significantly positive impact on innovation adoption. In the same vein, social capital exerts significantly positive impact on both innovation generation and adoption. Moreover, interaction of social capital further strengthens the influence of organizational capital on innovation adoption. Contrary to hypotheses, human capital does not exert significant influence on innovation generation. However, interaction of social capital further strengthens the impact of human capital on innovation generation.Practical implicationsFindings offer implications for modern managers to utilize the knowledge that resides in firm’s different locations. It also enhances managerial ability to identify and apply these knowledge resources to expedite innovation generation and adoption.Originality/valueInnovation generation and adoption plays a critical role in firm’s acquiring success and competitive advantage, yet the influence of intellectual capital on innovation generation and adoption mostly remains as unexplained puzzle. This study contributes to knowledge-innovation literature by examining the missing link between different types of knowledge and innovation generation and adoption. It also helps to comprehend the enabling factors through which firms capitalize upon, and obtain, a sustainable competitive advantage.