Within the Business Administration literature, the concepts of Organizational Learning, Knowledge Management, and Intellectual Capital Measurement have become the center of interest. Undoubtedly, it constitutes a novel and complex field of research, whose gestation began in the early 1990s in countries such as Sweden and the United States.
According to Brooking (1997), intellectual capital is nothing new, but has been around since the time the first seller established a good relationship with a customer. Later it was called commerce fund. What has happened over the past two decades is an explosion in certain key technical areas, including the media, information and communication technology, which have provided us with new tools with which we have built a global economy.. Many of these tools provide immaterial benefits that are now taken for granted, but did not exist before, to the point that the organization cannot function without them. Owning such tools provides competitive advantages and, therefore, constitutes an asset.
Our competitive environment demands changes, the speed with which our ideas are born, compete and die leads us to the need to manage organizations in a very different way than we did only 4 or 5 years ago.
The need to generate new ideas, faster, has made it easier for the value of information and knowledge to rise. Proof of this are the sectors that are directly related: telecommunications, internet, computer science in general, training, etc.
Therefore, the need to get people to agree to invest all their talent in the organization is recognized, with a much higher level of participation and involvement. In this line, a series of management models have emerged that recognize the value of knowledge and aim to promote it, structure it and make it operational or valid for the company. Some of these models are: intellectual capital, knowledge management, lifelong learning, facilitating leadership, empowerment, etc.
All of these approaches go through:
a) Assess the importance of information and knowledge.
b) Facilitate learning in organizations.
c) Assess the contribution of people.
Coaching, through a structured methodology, carries out approaches that allow us to work on improving performance and developing people's potential.
Organizations that are firmly committed to the development of intellectual capital find in coaching a valuable model to reach the person.
In almost all forums on management, leadership, intellectual capital, knowledge management, competencies, etc. The need for organizations to evolve the role of the boss towards that of facilitator is being alluded to. This role oriented to results but also to people, is much more in line with organizations that are committed to lifelong learning.
In this post-industrial, knowledge intensive, hypercompetitive era, in which global markets are exploited, a company must know how to take care of and develop its intellectual capital to gain an advantage over its competitors.
Within the literature, assets are classified into two types: tangible and intangible. Traditionally, tangible assets (physical and financial capital) constituted the most precious asset of companies. However, in the last years of the 20th century this idea has given way to the consideration of the category of intangible assets (Ventura, 1996, 1998) as the key to compete in dynamic environments. Organizational knowledge (Ordóñez, 1999) has become "the resource" (Drucker, 1992) par excellence. This intangible asset satisfies the requirements (Dierickx and Cool, 1993) to be considered strategic: 1) not marketable, developed and accumulated within the company, 2) strong tacit character and social complexity, 3) arises from skills and learning organizational, 4) is immobile and is linked to the company,and 5) their development depends on levels of learning, investment, asset stocks and previous development activities. Organizational knowledge is measured through the intellectual capital of the organization.
Intellectual Capital can be defined as the set of Intangible Assets of an organization that, despite not being reflected in traditional financial statements, currently generates value or has the potential to generate it in the future (Euroforum, 1998).
Another definition of Intellectual Capital: it is the sum and synergy of all the knowledge that a company gathers, all the experience accumulated in its members, everything it has achieved in terms of relationships, processes, discoveries, innovations, presence in the market and influence in the community.
For Edvinsson and Malone (1997) the intellectual capital is divided into:
• Human capital
• Structural Capital
• Client Capital.
• Organizational Capital.
• Capital Innovation.
• Process Capital
Steward (1997) divides intellectual capital into three blocks:
• Human capital.
• Structural Capital.
• Client Capital.
For Euroforum (1998), Intellectual Capital is made up of:
• Human capital.
• Structural Capital.
• Relational Capital.
According to William Miller, author of a book titled How to Inspire Creativity Where We Work, Intellectual Capital has four components - human capital, renovation capital, structural capital, and relational capital - that correspond to the four ways to create sustainable advantage and become a leader of the bouquet.
Building on these components, executives have a responsibility to expand intelligence, foster innovation, and exercise integrity - three core competencies of intellectual capital.
Knowledge is an aspect of intellectual capital but it is not the same as intelligence. Knowledge is a synthesis of information, while intelligence is what it takes to create knowledge. Intelligence implies that there are the necessary skills to learn, transfer knowledge, reason, see what is possible, find new interpretations, generate alternatives and make wise decisions.
Expanding intelligence generates intellectual capital creating new knowledge, that is, the "raw material" that allows people to innovate creating new products, services, processes and management methods.
Intellectual capital thrives in relationships with a high level of integrity. In reality, integrity is the foundation of strategic advantage because knowledge creation, innovation, and customer collaboration depend on it.
Integrity means uniqueness. At the company level, those who want to develop intellectual capital and manage knowledge must be integral and collaborative people, two essential conditions for creating and transferring new knowledge and creating and implementing innovation.
To that end, an executive must exercise integrity on three levels:
a) with himself, to act at the same time according to his heart, his mind and his objective;
b) with others, to communicate with authenticity and interest; and
c) with humanity, to live according to fundamental human values.
Knowledge is created and transferred through conversation, and leaders must master the art of fostering dialogue between team members.
Designing the organizational creed means selecting the level of commitment and trust of the workers and of course clearly understanding their hopes, dreams and aspirations. This is achieved with better results if there are 1 st workers in the organization. The important thing is to identify and select the basic components to measure the productivity of the workers and of the people who occupy positions at the managerial and supervisory levels, in the same way to determine the necessary and essential organizational architecture to provide support to said groups, and then go walking towards new horizons in the recent future, identifying changes as they happen and establishing common techniques and tools to measure them.
Intellectual capital measurement tools
Skandia's model
In 1991 Skandia AFS hired Leif Edvinsson to design a way to measure the company's asset creation process. Edvinsson developed a theory of "Intellectual Capital" incorporating elements from Konrad and the "Balanced Score Card" (Kaplan and Norton, 1992, 1993).
In traditional economic models only financial capital is normally used, but the Swedish company Skandia proposes the "Skandia Value Scheme", where it is shown that intellectual capital is made up of: 1) human capital, and 2) structural capital, which It is divided into client capital and organizational capital, that is, everything that remains when employees have gone home, information systems, databases, information technology software, etc. Organizational capital can be broken down into process capital (processes that create value and processes that do not create value), culture and innovation capital (intangible rights, trademarks, patents, recipe of knowledge and business secrets) (Skandia Capital Prototype Report, Skandia 1998).
Intellectual capital arises in a process of value creation based on the interaction of human and structural capital, where continuous renewal - innovations - transforms and refines individual knowledge into lasting value for the organization. It is important that human capital be converted into intellectual capital. Therefore, it is important that the organization's leaders provide working methods to facilitate the conversion of individual competences into organizational capital, and therefore, develop multiplier effects within the company.
Other tools developed by Skandia are: 1) Dolphin, an information and business control software system. It is based on the "Skandia Navigator" and allows the user to choose the approach under which he wants to observe an operation, and also allows simulations to be carried out; 2) IC-Index ™, are indicators of the IC and its components, which can be consolidated to form a measure that can dynamically describe the IC and its development over time. It also allows comparisons between changes in the intellectual capital of the company and changes in the market value of the company.
The Balanced Scorecard or Balanced Scoreboard
As Ulrich (1997) points out, the Balanced Scorecard has been developed by Kaplan and Norton (1992, 1993, 1996) and is used as a measurement and management tool in companies such as AT&T, Eastman Kodak, American Express and Taco Bell.
Each organization has multiple "stakeholders" or groups of individuals with whom it interacts to develop its business, and as Kaplan and Norton (1993) point out in recent years, "stakeholder" models (groups of people who have an interest in the company, like employees, customers, and investors) have resulted in balanced scores. As Kaplan and Norton (1992, 1993 and 1996) point out, the premise on which the Balanced Scorecard is built is that to have a successful organization, the requirements demanded by three groups of individuals must be met: 1) investors, who they require financial returns, measured through economic profitability, market value and cash flow; 2) customers, who demand quality, measured through market share, customer engagement and retention, for example;3) employees, who want a prosperous workplace, which can be measured as the actions of employees and the organization. Add, along with financial measures, measures for customers, internal processes and innovation. The Balanced Scorecard includes the measures of the group of employees, the most difficult to measure, through productivity, people, and processes.
The Intangible Assets Monitor
This tool constitutes a theory of flows and stocks (Sveiby, 1999) whose objective is to guide managers in the use of intangible assets, identification of flow and renewal of them, as well as avoiding their loss. It focuses on three intangible assets (Externally structured assets, Internally structured assets, and People's Capacity Assets), accepting existing financial indicators.
A company that uses this tool in the measurement of its intangible assets is the Swedish company Celemi, whose activity focuses on the development and sale of tools globally. The Celemi Intangible Assets Monitor aims (Sveiby, 1997b) to determine if its intangible assets are generating value and if they are being used efficiently. Celemi's so-called “Invisible Balance” classifies these assets under the following headings: 1) “our clients”, which refers to an external structure of relationships with clients, suppliers, brands, contracts, reputation and image. Celemi employees are the ones who create this structure, 2) "our organization" is the organizational structure made up of patents, concepts, models of contracts with suppliers and computer and support systems, 3) "our people",which are the combined capabilities of Celemi employees. The 1995 Celemi Annual Report states that to know the impact of customers, the company calculates the proportion of sales from three categories of customers: 1) those who increase the image, that is, the external structure, 2) those that increase the organization, therefore improving the internal structure, 3) those that increase capacity, allowing Celemi employees to learn from them.therefore improving the internal structure, 3) those that increase capacity, allowing Celemi employees to learn from them.therefore improving the internal structure, 3) those that increase capacity, allowing Celemi employees to learn from them.
Celemi has developed different tools that allow companies to better value and understand their intangible assets. Among them is Tango ™, the first business simulation of the organization of knowledge, jointly developed by Klas Mellande, Celemi and Sveiby. As Barchan (1997) points out, it is a simulation tool that allows identifying the key intangible assets of the company, measuring them, and managing them in coordination with tangible assets. Intangible assets are studied at different levels: 1) growth and renewal, 2) efficiency, and 3) stability of different parameters of the company.
Strategic Management Model by Competencies: Intellectual Capital
The Strategic Competency Management Model (Bueno, 1998) is made up of four blocks (Organizational Capital, Human Capital, Technological Capital and Relational Capital), which reflect the three basic pillars of Strategic Competency Management: 1) Knowledge (Co), 2) Capacities (Ca), and 3) Attitudes and Values (A), which constitute the basic distinctive competence.
Technology Broker
Annie Brooking, founder and director of The Technology Broker Consulting (UK), leader in Intellectual Capital development services, develops an intangible assets measurement model that is collected under the name of Techonology Broker in her book Intellectual Capital (1996). Intellectual Capital measures are useful (Brooking, 1996) for the following reasons: 1) they validate the organization's ability to achieve its goals, 2) plan research and development, 3) provide basic information for reengineering programs, 4) they provide a focus for organizational education and training programs, 5) calculate the value of the business, and 6) expand organizational memory.
Intellectual Capital is made up of four categories of assets (Brooking, 1996): market assets (brands, clients, image, order book, distribution, capacity for collaboration, etc.) human assets (education, professional training, specific job knowledge, skills), intellectual property assets (patents, copyrights, design rights, trade secrets, etc.) and infrastructure assets (business philosophy, organizational culture, information systems, existing databases in the company, etc.). As in the Skandia Model, the Technology Broker Model assumes that the sum of tangible assets plus Intellectual Capital make up the market value of a company. This model, unlike the previous ones, reviews a list of qualitative questions,without reaching the definition of quantitative indicators, and furthermore, affirms that the development of methodologies to audit information is a previous step to the generalization of the measurement of Intellectual Capital.
The company must not only manage its knowledge efficiently, but also quantify it using tools to measure organizational intellectual capital. These measurements are of interest both from the internal point of view (enables the improvement of organizational efficiency) and externally (the "stakeholder" - groups interested in the company - obtain a more complete assessment of the company).
Related Sites.
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www.arearh.com/coaching/CCI.htm
www.revistainterforum.com/espanol/articulos/070802negocios.html
