Profiting from intellectual capital. Learning from leading companies
| Published date | 01 March 2000 |
| Date | 01 March 2000 |
| Pages | 33-46 |
| DOI | https://doi.org/10.1108/14691930010324124 |
| Author | Suzanne Harrison,Patrick H. Sullivan |
| Subject Matter | Accounting & finance,HR & organizational behaviour,Information & knowledge management |
Profiting from
intellectual
capital
33
Journal of Intellectual Capital,
Vol. 1 No. 1, 2000, pp. 33-46.
#MCB University Press, 1469-1930
Profiting from intellectual
capital
Learning from leading companies
Suzanne Harrison and Patrick H. Sullivan Sr
The ICM Group, LLC, Palo Alto, California, USA
Keywords Intellectual capital management, Intellectual asset management,
Intellectual property management, Value extraction
Abstract Over the course of the 1990s the level of interest as well as the sophistication of best
practices in the management of intangible assets have increased dramatically. This article is
intended to provide information on the current state of best practices in the management
of intellectual capital. In addition, the article will discuss the evolution of best practices in
ICM, concepts underlying the activities of companies sophisticated in the management of
their intangibles, factors affecting the measurement of intellectual capital, and the ways in
which companies tailor their ICM activities to match the needs of their different business
strategies.
A brief history
The management of intellectual capital has a history that began in the early
1980s as managers, academics and consultants around the world slowly
became aware that a firm's intangible assets, its intellectual capital, were often
a major determinant of the corporation's profits. For example, in Japan, circa
1980, Hiroyuki Itami noticed the difference in performance among Japanese
companies and after some study attributed it to differences in the firm's
intangible assets. His published analysis concluded that intangible assets are
``unattainable with money alone, are capable of multiple, simultaneous use, and
yield multiple simultaneous benefits''. In Sweden, Karl-Eric Sveiby, the
manager of a small publishing company, published a book in 1986, in Swedish,
The Know-How Company, on how to manage these intangible assets.
In 1986 University of California Berkeley Business School Professor David
Teece wrote ``Profiting from technological innovation'', an article in which he
identified the steps necessary for the extraction of value from innovation. The
explication of these steps had major implications for innovation-rich
companies. It meant that for the first time managers could learn, and
subsequently teach their employees, how to maximize the value of the firms'
innovations. After reading Teece's article, Patrick Sullivan, an independent
business consultant specializing in the extraction of profits from technology,
became interested with the idea that there could be a systematic set of decisions
and rules that companies might use to extract profits from their innovations.
He refined and expanded on Teece's ideas and was one of the first to establish a
viable consulting practice focused on advising clients on the extraction of value
from innovation from a business perspective.
The current issue and full text archive of this journal is available at
http://www.emerald-library.com
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