Competitive advantage: mediator of intellectual capital and performance
| DOI | https://doi.org/10.1108/14691931111097953 |
| Published date | 18 January 2011 |
| Pages | 152-164 |
| Date | 18 January 2011 |
| Author | Nixon Kamukama,Augustine Ahiauzu,Joseph M. Ntayi |
| Subject Matter | Accounting & finance,HR & organizational behaviour,Information & knowledge management |
Competitive advantage: mediator
of intellectual capital and
performance
Nixon Kamukama
Department of Accounting, Makerere University Business School, Kampala,
Uganda
Augustine Ahiauzu
Rivers State University of Science and Technology, Port Harcourt, Nigeria, and
Joseph M. Ntayi
Faculty of Computing and Management Science, Makerere University Business
School, Kampala, Uganda
Abstract
Purpose – The purpose of this paper is to examine the mediating effect of competitive advantage in
the relationship between intellectual capital and financial performance in Uganda’s microfinance
institutions. The major aim is to establish the role of competitive advantage in the relationship
between intellectual capital and firm performance.
Design/methodology/approach – The paper adopts MedGraph program (Excel version), Sobel
tests and the Kenny and Boran approach to test for mediation effects.
Findings – Competitive advantage is a significant mediator in the association between intellectual
capital and financial performance and boosts the relationship between the two by 22.4 percent in
Ugandan microfinance institutions. Further findings confirmed a partial type of mediation between
the intellectual capital, competitive advantage and financial performance.
Research limitations/implications – Only a single research methodological approach was
employed and future research through interviews could be undertaken to triangulate. Furthermore, the
findings from the present study are cross-sectional. Future research should be undertaken to examine
the mediation effects studied in this paper across time.
Practical implications – In order to have a meaningful interpretation of the results of the
relationships between study variables, it is always vital to assess the role of the third variable
(competitive advantage) in the relationship. This enables practitioners and scholars to comprehend
and make legitimate decisions and conclusions that can foster business growth.
Originality/value – This is the first study that focuses on testing the mediating effect of competitive
advantage on the relationship between intellectual capital and financial performance in Ugandan
microfinance institutions.
Keywords Intellectualcapital, Competitive advantage,Financial institutions, Financialperformance,
Uganda
Paper type Research paper
Introduction
The liberalization and commercialization of microfinance industry in some nations,
Uganda in particular, resulted into stiff competition (CGAP, 2002; Adongo and
Christopher,2005), which is thought to account forthe poor performance of microfinance
institutions (Kalyango, 2005). This orientation has changed the strategy of microfinance
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1469-1930.htm
JIC
12,1
152
Journal of Intellectual Capital
Vol. 12 No. 1, 2011
pp. 152-164
qEmerald Group Publishing Limited
1469-1930
DOI 10.1108/14691931111097953
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