The fact that something cannot be
touched does not mean that it is not there or that it has no value. This simply
means that it is intangible; like air, creativity or knowledge, all of which
are intangible, valuable and can be valued. The same is true of
Intellectual Capital (IC).
Rastogi (2002) says that a way in which
to understand the ‘idea’ of Intellectual Capital is through the skills or
expertise of a company and the manner in which it holistically creates added
value for its customers or clients.
Intellectual Capital can, therefore, be
seen as the sum total of intangible skills and knowledge that a company has. IC
can be categorized into four group headings: Human Capital, Social Capital,
Structural Capital and Customer Capital. These four groups make-up Intellectual
Capital and work together to bring about key competencies that assume strategic
significance and therefore together produce value. An example of this is the
advertising and communications industry that I work in, where our core
competencies are based on our people and who together we produce value for our
Intellectual Capital or Intellectual
Assets (IC or IA) according to Itami (1991) can be
defined as: “…invisible assets that include a wide range of activities such as
technology, consumer trust, brand image, corporate culture and management
skills” Hall (1992) considers that “intangible assets are value drivers that
transform productive resources into value-added assets.” He splits IA into two
categories: (1) intellectual property (IP); and (2) knowledge assets.
Intellectual property is another area in which, as advertisers, we deal in for
ourselves and for our clients when creating brand-building ideas, at a cost. As
a business our assets – both tangible and intangible- help to produce goods and
services that we sell to make a profit.
Hall, R. (1992),
“The Strategic Analysis of Intangible Resources”, Strategic Management Journal, Vol. 13 No. 2, pp. 135-44.
Itami, H. (1991), “Mobilizing
Invisible Assets”, Harvard University
Press, Cambridge, MA.
(2003), “The Nature and Role of IC – Rethinking the Process of Value Creation
and Sustained Enterprise Growth”, Journal
of Intellectual Capital, Vol. 4 No. 2, pp. 227-48.