Implementing an intellectual capital framework in practice
| Pages | 69-83 |
| Published date | 11 January 2013 |
| Date | 11 January 2013 |
| DOI | https://doi.org/10.1108/14691931311289020 |
| Author | Paola Demartini,Paola Paoloni |
| Subject Matter | Accounting & finance,HR & organizational behaviour,Information & knowledge management |
Implementing an intellectual
capital framework in practice
Paola Demartini
Department of Management and Law, University of Rome Tre, Rome, Italy, and
Paola Paoloni
University of Human Sciences “N. Cusano”, Rome, Italy
Abstract
Purpose – The purpose of this paper is to analyse the transition from measurement to management
in relation to intellectual capital (IC). It aims to understand the relationships between measurement of
IC and operational activities, strategies and context.
Design/methodology/approach – This study takes an “action research” perspective to investigate
the management of the analysed company in respect to IC.
Findings – The study concerns a company operating in the field of electronics and defence, which has
developed a model of IC management. Every project set up by the company that impacts on IC is
subject to measurement, valuation and reporting. This model aims to be an effective support to general
management, providing a link between intangible assets and capabilities that create value.
Originality/value – This study does not aim to develop a framework for IC measurement but to
highlight the process leading to implementing an IC framework in practice.
Keywords Intellectual capital, Action research, Knowledge management control,
Business performance, Knowledge management
Paper type Research p aper
1. Introduction
The strategic role of intangibles in value creation is established at the academic level,
but not so in the corporate world. Empirical studies confirm the existence of strong
links between investment in intangibles and in a company’s performance. However,
many aspects of the management and measurement of intangibles are still contentious,
such as the inadequacy of traditional economic tools in financial management and
measurement. One of the challenges for management, therefore, is the search for a
model to enhance, measure and manage intangible assets, wh ich, being “firm specific”
and difficult to imitate, are the key value drivers that can be relied on to gain a
competitive advantage over time.
Much intellectual capital (IC) literature is concerned with uncovering the hidden
value in intangible resources via direct measurement of its elements (Edvinsson and
Malone, 1997; Bontis, 1998; Lev, 2001; Sveiby, 2010). However, generally, interest in
IC stops at its measurement, without explaining how informatio n about IC works. As
Mouritsen and Larsen (2005, p. 372) point out there is an additional management
control agenda where information about IC is an input to management activities. This
means, to be able to understand the relationships between measurement on the one
side and operational activities, strategies and context on the other.
The purpose of this paper is to highlight the process leading to selecting an d
implementing an IC framework in practice. In our investigation we focus on the IC
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1469-1930.htm
Journal of Intellectual Capital
Vol.14 No. 1, 2013
pp. 69-83
rEmeraldGroup PublishingLimited
1469-1930
DOI 10.1108/14691931311289020
The research group was made also by two firm’s professionals: Maria Vittoria Guidotti and
Isabella Angelone.
69
Intellectual
capital
framework
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