Perspectives on Intellectual Capital: Multidisciplinary Insights Into Management, Measurement, and Reporting

254 Pages·2005·1.74 MB·English

by  Bernard Marr

Advance Praise for Perspectives on Intellectual Capital: Multidisciplinary
Insights into Management, Measurement, and Reporting
“Outstanding! Bernard Marr has drawn on the top pioneers and experts in intellectual capital to
provide an indispensable resource for investors and executives. Each chapter shines alone but as
a whole they provide a clear, lucid, yet in-depth exploration of the most important themes and
issues around the new fundamentals for understanding and valuing intangible assets. This col-
lection of essays will prove useful for those new to the field as well as those who have been apply-
ing these principles for some time.”
—Verna Allee, author of The Future of Knowledge: Increasing Prosperity through Value
Networks
“Marr has managed to bring together some of the brightest minds in the field to discuss the
important concept of intellectual capital from a variety of perspectives. A major achievement!”
—Daniel Andriessen, Professor of Intellectual Capital, INHOLLAND University; Author of Find
your Real Value in a Future of Intangible Assets and Making Sense of Intellectual Capital;
Designing a Method for the Valuation of Intangibles
“For many, intellectual capital remains a fad-ridden minefield. Bernard Marr negotiates a route
through the distracting complications to prove that intellectual capital is the essence of modern
business.”
—Stuart Crainer, Editor, Financial Times Handbook of Management, and Editorial Fellow,
London Business School
“The last decade has witnessed a substantial amount of literature on intellectual capital. Here,
for the first time, is a comprehensive, multi-disciplinary perspective on intellectual capital, setting
a milestone for reaching a common understanding on intellectual capital, its usage and relevance
to public, private and third sector business management in the 21st century.
An impressive result, which opens up new horizons for understanding the ‘how’s’, ‘why’s’ and
‘what’s’ of intellectual capital. This book sets a standard for management thinking now and into
the future. It promotes cross-disciplinary awareness and collaboration, appealing to a wide audi-
ence, encompassing business executives, academics, investors, students and policy makers alike.
This book is highly recommended as a text for undergraduate and post graduate teaching, as well
as being a substantial contribution to the research literature.”
—Professor James Guthrie, Discipline of Accounting and Business Law, Faculty of Economics
and Business, The University of Sydney, Australia
“In the context of the European Union setting itself the strategic goal to become the most com-
petitive and dynamic knowledge based economy in the world, this book should become one of
the ‘must reads’ for managers and all those who create the economic environment. Why? Because
intellectual capital is the key value-creating factor of the knowledge economy and everyone who
wants to cope with the ongoing transition successfully will have to learn as much about it as fast
as they can.
This book provides valuable insights for absolute IC-beginners as well as for IC-pioneers, like
myself, and I highly recommend it to all who are interested in leveraging their company’s, regions
or nations value creating potential.”
—Dr. Ante Pulic, Professor of Finance, University of Zagreb, Croatia
“Excellent new book on intellectual capital. With academic rigor, Bernard Marr examines
key topics on intellectual capital, organizational learning, knowledge management and their
connections.”
—Patricia Ordóñez de Pablos, Professor of Business Administration, The University of Oviedo,
Spain, Executive Editor of the International Journal of Learning and Intellectual Capital
“Although executives around the world consider intellectual capital as the most relevant factor
for the future success of their business, their approaches of managing it are still poor or non-
existent. Bernard Marr tries to disentangle the main reasons of this frustrating gap. His book
Perspectives on Intellectual Capital is, as for as I know, the first systematic and scientific approach
on the way to elucidate the concept of intellectual capital and on the critical process of deploy-
ing intangible assets to establish and sustain competitive advantages.”
—Dr. José Ma. Viedma Martí, President of Intellectual Capital Management Systems and
Professor of Business Administration at Polytechnic University of Catalonia
Perspectives on
Intellectual Capital
E d i t e d b y
B e r n a r d M a r r
AMSTERDAM • BOSTON • HEIDELBERG • LONDON
NEW YORK • OXFORD • PARIS • SAN DIEGO
SAN FRANCISCO • SINGAPORE • SYDNEY • TOKYO
Elsevier Butterworth-Heinemann
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Linacre House, Jordan Hill, Oxford OX2 8DP, UK
Copyright © 2005, Elsevier Inc. All rights reserved.
No part of this publication may be reproduced, stored in a retrieval system, or
transmitted in any form or by any means, electronic, mechanical, photocopying,
recording, or otherwise, without the prior written permission of the publisher.
Permissions may be sought directly from Elsevier’s Science & Technology Rights
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Recognizing the importance of preserving what has been written, Elsevier prints
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Library of Congress Cataloging-in-Publication Data
Perspectives on intellectual capital / Bernard Marr.
p. cm.
Includes bibliographical references.
ISBN 0-7506-7799-6
1. Intellectual capital. I. Marr, Bernard. II. Title.
HD53.P47 2005
338.5–dc22
2004022862
British Library Cataloging-in-Publication Data
A catalogue record for this book is available from the British Library.
ISBN: 0-7506-7799-6
For information on all Elsevier Butterworth-Heinemann publications
visit our Web site at www.books.elsevier.com
05 06 07 08 09 10 10 9 8 7 6 5 4 3 2 1
Printed in the United States of America
I dedicate this book to
my wife Claire
and with loving memory
to my mother.
This Page Intentionally Left Blank
Contents
Foreword, Robert Grant ix
Preface xi
Introduction xiii
Part One Disciplinary Views
1
Chapter 1 An Economics Perspective on Intellectual Capital, Mie Augier and
David Teece 3
Chapter 2 A Strategy Perspective on Intellectual Capital, Bernard Marr and
Göran Roos 28
Chapter 3 An Accounting Perspective on Intellectual Capital, Baruch Lev, Leandro
Cañibano, and Bernard Marr 42
Chapter 4 A Finance Perspective on Intellectual Capital, Sudi Sudarsanam, Ghulam Sorwar,
and Bernard Marr 56
Chatper 5 A Reporting Perspective on Intellectual Capital, Jan Mourtisen, Per Nikolaj Bukh,
and Bernard Marr 69
Chapter 6 A Marketing Perspective on Intellectual Capital, Lisa Fernström 82
Chapter 7 A Human Resource Perspective on Intellectual Capital, Ulf Johanson 96
Chapter 8 An Information Systems Perspective on Intellectual Capital, Joe Peppard 106
Chapter 9 A Legal Perspective on Intellectual Capital, L. Martin Clotier and
E. Richard Gold 125
Chapter 10 An Intellectual Property Perspective on Intellectual Capital,
Patrick H. Sullivan, Jr. 137
Part Two Interdisciplinary Views
153
Chapter 11 An Interfirm Perspective on Intellectual Capital, Giovanni Schiuma, Antonio
Lerro, and Daniela Carlucci 155
Chapter 12 A Public Policy Perspective on Intellectual Capital, Ahmed Bounfour and Leif
Edvinsson 170
vii
viii Contents
Chapter 13 A Knowledge-Based Perspective on Intellectual Capital, J.-C. Spender and
Bernard Marr 183
Chapter 14 An Epistemology Perspective on Intellectual Capital,
Göran Roos 196
Part Three Discussion and Final Thoughts
211
Chapter 15 The Evolution and Convergence of Intellectual Capital as a Theme,
Bernard Marr 213
Index 227
Foreword
It is becoming increasingly apparent that the beginning of the twenty-first cen-
tury marked a watershed in both world history and the development of business
management. In international relations, the events of September 11, 2001, and
its aftermath—the U.S.-led invasions of Afghanistan and Iraq and the decline of
multilateralism—provided a dramatic end to the euphoria that followed the breakup
of the Soviet Union, the collapse of communism as a viable politicoeconomic system,
and the end of the Cold War.
The world of business also entered a new era of uncertainty. The year 2001 saw the
end of the TMT (telecommunications, media, and technology) boom, the onset of a
bear market for stocks, and a host of corporate scandals that engulfed some of the
world’s most prominent and successful companies. The resulting uncertainties rose
partly from the conditions in the business environment (anemic growth, high energy
and raw material prices, and growing protectionism) and partly from waning confi-
dence in corporate leaders’ ability to manage in a complex and turbulent environment.
The dominant management model of the 1990s, that of shareholder value maximiza-
tion, lost much of its credibility. At the same time, the very success of strategies based
on this model (cost cutting, refocusing, outsourcing, reengineering and delayering)
meant that most of the potential gains from these restructuring activities are largely
exhausted.
Hence, corporate executives face two critical strategic questions. First, what will be
the main sources of future profitability now that most of the low-hanging fruit on the
tree of profit has been harvested? Second, what principles and theories of management
can guide companies in exploiting these future sources of profitability? The emerging
field of intellectual capital can help us in relation to both.
Despite nearly a decade when knowledge management in its various forms has been
prominent, it is clear that, in most firms, the major areas of inefficiency lie in the uti-
lization of intellectual capital. In almost every organization I have close contact with,
I see human effort, human creativity, and individuals’ desire to excel being squan-
dered. The most important factor distinguishing high performance companies,
whether at the frontiers of science such as Intel or in the unglamorous world of dis-
count retailing such as Wal-Mart, is the ability to access and deploy the knowledge
resources available to them.
Managing intellectual capital requires working at multiple organizational levels
and at different levels of complexity and uncertainty. At the most fundamental level,
companies need to recognize the different types of intellectual capital they possess and
the characteristics of these assets. Considerable progress has been made in relation to
managing distinct categories of intellectual capital, most notably in human resource
management and intellectual property management. Yet, for many companies, top
management’s understanding of the company’s asset base remains bounded by the
ix