Knowledge Ecology in Global Business: Managing Intellectual Capital

Knowledge Ecology in Global Business: Managing Intellectual Capital

Miltiadis D. Lytras (The American College of Greece, Greece) and Patricia Ordóñez de Pablos (Universidad de Oviedo, Spain)
Release Date: March, 2009|Copyright: © 2009 |Pages: 396
ISBN13: 9781605662701|ISBN10: 1605662704|EISBN13: 9781605662718|DOI: 10.4018/978-1-60566-270-1


These days, companies require deep understanding of the key elements of intellectual capital that drive value in order to achieve a competitive advantage for the organization.

Knowledge Ecology in Global Business: Managing Intellectual Capital provides fresh ideas on how intellectual capital through emerging technologies can support business performance. Through coverage of essential topics such as competitive strategy, human resource management, and organizational learning, this indispensable collection demonstrates the capacity of information technology, management, and sustainable development for the mutual understanding, prosperity, and well-being of all citizens.

Topics Covered

The many academic areas covered in this publication include, but are not limited to:

  • Corporate memory
  • Intellectual Capital
  • Intellectual capital reporting
  • Knowledge ecology in global business
  • Knowledge Management
  • Knowledge processors
  • Knowledge sharing and language use
  • Knowledge transfer in virtual teams
  • Knowledge-based economy
  • Organizational knowledge assets
  • Organizational Learning
  • Organizational learning process
  • Strategic innovation management
  • Strategic management research

Reviews and Testimonials

This book exploits the interrelationships among different intellectual capital elements and their value creation consequences through a well justified support from emerging technologies services on the top of business processes and strategic decisions.

– Miltiadis D. Lytras, Athens University of Economics & Business, Greece

Table of Contents and List of Contributors

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Patricia Ordóñez de Pablos
Table of Contents
Chapter 1
Jakob Lauring, Toke Bjerregaard
This chapter deals with the role of language use and knowledge sharing in the context of international subsidiaries. The chapter analyzes the role... Sample PDF
Knowledge Sharing and Sociality: On the Linguistic Embeddedness of Knowledge Exchange in International Subsidiaries
Chapter 2
Ruth Alas
This chapter analyzes organizational changes and organizational learning in Estonian companies. During the last decades, Estonia has transformed... Sample PDF
Organizational Learning During Changes in Estonian Organization
Chapter 3
Giovanni Schiuma
Today’s global business is characterised by interconnectedness, interdependence, and an increasing level of complexity that force organisations to... Sample PDF
Strategies for Assessing Organisational Knowledge Assets
Chapter 4
Poul Houman Andersen
In order to capture market dividends and stay at par with the competition in the knowledge-based economy, firms must constantly develop their skill... Sample PDF
Division of Interfirm Activities in the Knowledge-Based Economy: The Crucial Role of Knowledge Processors
Chapter 5
Luiz Antonio Joia, Paulo Sérgio da Silva Sanz
Since the early 1990s, research has been conducted in an attempt to establish a viable and reliable manner of measuring the intangible assets, also... Sample PDF
The Conundrum of Valuing a Company's Intellectual Capital: The Role of Taken-for-Granted Indicators
Chapter 6
Tongo Constantine Imafidon
This chapter avers that over the past years, monolithic organizations, as opposed to multicultural organizations, have been created by many top... Sample PDF
The Multicultural Organization: A Historic Organizational Theory for Gaining Competitiveness in Global Business Environment
Chapter 7
Arla Juntunen
This chapter focuses on the challenges of developing a knowledge management platform to support organizational memory and knowledge transfer. The... Sample PDF
Developing a Corporate Memory as a Competitive Advantage in the ICT-Sector
Chapter 8
Corrado lo Storto
This chapter reports the findings of an empirical study whose purpose is to identify the attributes of the organization infrastructure that support... Sample PDF
Learning Organizations or Organizations for Learning? How Small Firms can Learn from Planned and Random Technical Problem-Solving: Implications for Technical Education
Chapter 9
Ernesto Villalba
The present study explores the relationship between the knowledge-enabling environment and the demand of training in 18 small private companies... Sample PDF
Learning at the Core: Knowledge Management as an Employer Strategy for Lifelong Learning
Chapter 10
Dimitris Bibikas, Iraklis Paraskakis, Alexandros G. Psychogios, Ana C. Vasconcelos
The increasing pressure of today’s highly globalised markets has lead organisations to continuously compete for knowledge and innovation. Despite... Sample PDF
An Integrated Knowledge Innovation Process Management Model: The Case of Skandia
Chapter 11
Christian Nielsen, Robin Roslender, Per Nikolaj Bukh
During the last decade, many calls for improving disclosure practices, in relation to intellectual capital and intangibles, have been uttered in the... Sample PDF
Intellectual Capital Reporting: Can a Strategy Perspective Solve Accounting Problems?
Chapter 12
Huei-Chen Hsu
The main points of this chapter are probing for the combination of information technology and virtual work, and how to change the distribution of... Sample PDF
Managing the Information Technology: Knowledge Transfer in Virtual Teams
Chapter 13
Miltiadis D. Lytras, Patricia Ordóñez de Pablos
Multinational companies (MNCs) are facing important challenges within the current economic context. Rapid technological changes, the globalization... Sample PDF
The Building of the Intellectual Capital Statement in Multinationals: Challenges for the Future
Chapter 14
Pedro López Sáez, José Emilio Navas López, Gregorio Martín de Castro
During more than a decade, the literature has provided several intellectual capital models. Nevertheless, empirical evidence is still necessary in... Sample PDF
Intellectual Capital in Knowledge-Intensive Firms: Exploring the Concept and Main Components in Boston's Route 128
Chapter 15
Weiling Ke, Kwok Kee Wei
This chapter uses organizational learning as a lens to study how firms implement the enterprise system. The core research questions are: What are... Sample PDF
Organizations and Learning Process: Its Antecedents and Consequences in Enterprise System Implementation
Chapter 16
Kholekile L. Gwebu, Jing Wang
Improvements in technology have led to innovations in training such as Electronic Learning (E-learning). E-learning aims to help organizations in... Sample PDF
The Role of Organizational Environmental, and Human Factors in E-Learning Diffusion
Chapter 17
Mikel Sorli, Dragan Stokic
Managing of knowledge for innovation in an extended enterprise (EE) environment is a key issue. This in turn requires effective utilization of... Sample PDF
Supporting Innovation Through Knowledge Management in the Extended Enterprise
Chapter 18
Luis Felipe Luna-Reyes
Contemporary organizations face the challenge of growing and advancing in a complex and changing environment (Johannessen, Olaisen, & Olsen, 2001;... Sample PDF
Government Innovation Through Knowledge Management
Chapter 19
Marc Henselewski, Stefan Smolnik, Gerold Riempp
Today’s business environment is characterized by highly transparent markets and global competition. Technology life cycles are decreasing due to the... Sample PDF
A Technology-Focused Framework for Integrating Knowledge Management into Strategic Innovation Management
About the Contributors


The determinants of growth and profitability of firms and organizations, as well as of national economies as a whole, is reliant upon their effectiveness and efficiency in gathering and utilising knowledge assets to solve current problems and exploit future opportunities (OECD, 1999). The strategic building material of the modern organization is the creation and use of knowledge-based resources. However, these intangible resources are invisible to many companies, making measurement and management difficult for most managers. If we understand the key elements of intellectual capital that do in fact drive value, we will be able to achieve a competitive advantage for the organization. Undoubtedly, these new strategic decisions will reflect new forms of working, new models of business and new approaches to management thinking (Lytras and Ordóñez, 2007, 2009)

The concept of intellectual capital is still unknown to many because it is difficult to measure in explicit terms (Bontis, 1998; Lytras and Ordóñez, 2008; Seetharaman et al., 2002). In this sense, Chaharbaghi and Cripps (2006: 30) state that “it is impossible and undesirable to reduce intellectual capital to a calculable number that establishes whether an organization’s intellectual capital has increased or diminished”. Furthermore Marr (2005) believes that different people talk about intellectual capital from different perspectives, using the same language to describe different constructs (Roos and Roos, 1997; Ordóñez de Pablos, Edvinsson and Lytras, 2008;).

We can understand intellectual capital as the sum of all knowledge-based factors (i.e., resources, capabilities and competences) that are critical to the creation of organizational value and a long term sustained competitive advantage. This incremental value is a resultant of a set of activities described within the knowledge management literature (Bontis, 2002). The purpose of knowledge management is to build the intellectual capital of a firm. As such the academic field benefits from a wide variety of perspectives such as accounting (Bontis, 1996; Bontis et al., 2001), library science (Lytras et al., 2005), information systems (Lytras and Pouloudi, 2006), project management (Lytras and Pouloudi, 2003) and strategic management (Choo and Bontis, 2002; Lytras and Ordóñez, 2007).

Knowledge-based resources, like human capital, relational capital or structural capital, seldom have a direct impact on performance. Indirectly they work impact through complementary and non-linear relationships of cause and effect (Kaplan and Norton, 2004; Ordóñez de Pablos, 2001). Research on the economics of knowledge-based resources shows that investments in knowledge-based resources not always stimulate productivity and growth without a number of complementary developments. Recent studies have been placing more emphasis on the analysis of interactions and interdependencies of various intellectual capital components (Bontis, 2004; Ordóñez de Pablos, 2001; Tsan and Chang, 2005).

However, much more detailed and empirically grounded research involving the interrelationships between the different components of intellectual capital is needed to understand how these enable (or impinge upon) value creation. The purpose of this proposed book is to exploit the interrelationships among different intellectual capital elements and their value creation consequences through a well justified support from emerging technologies services on the top of business processes and strategic decisions.

Literature Review

Intellectual capital literature covers diverse typologies of intellectual capital that have been developed until now. Most authors agree with the idea that intellectual capital is formed by three sub-constructs: human capital, relational capital and structural capital (Bontis et al., 2002; Lytras and Ordóñez, 2007; Ordóñez, Edvinsson and Lytras, 2008; Roos and Roos, 1997.).

Human capital reflects the set of knowledge, abilities, skills and experience of the employees of the company or the people of a region or country. It represents the accumulated value of investments in people training, competence and future. It also includes an even more intangible element: people motivation. Relational capital reflects the value of organizational relationships (customers, suppliers, shareholders, and the Administrations) or the relations that a region or country has with other regions and/or countries. Finally structural capital represents knowledge that has moved from individuals or from the relationships between individuals to be embedded in organizational structures (such as organizational culture, routines, policies or procedures) or regional or national structures. Generally this sub-construct is divided into technological capital and organizational capital (Bontis et al., 2000; Ordóñez de Pablos, 2007). Technological capital represents industrial and technical knowledge, such as results from R&D and process engineering. Organizational capital includes all aspects that are related with the organization of the company and its decision making process -for example organizational culture, organizational structure design, coordination mechanisms, organizational routines, planning and control systems, among others- as well as the knowledge embedded in regional and national policies.

Summarizing, human capital, relational capital and structural capital respectively represent strategic knowledge stocks that can contribute to the creation of a long term competitive advantage.

Intellectual capital and value creation in organizations

Intellectual capital is seen as the main trigger of value-creation and sustainable competitive advantage (Prahalad and Hamel, 1990). This suggests evidence of an empirical relationship between intellectual capital and organizational value creation. This link is embedded in a firm’s ability to continually build its intellectual capital base by generating new knowledge. Knowledge generation is a process of creating value by recombining previous knowledge through Schumpeterian innovation for an overview. When this recombination builds on already existing intellectual capital, a transformative positive effect on performance is expected.

Researchers from a variety of disciplines have highlighted the close tie between a firm’s orientation toward organizational learning and knowledge management and its stock of knowledge-based resources. In this paper, we focus on focus on one type of these resources: human capital. Human capital is the primary foundation for organizational learning (Bontis, Crossan and Hulland, 2002). Human resource management department can contribute to the creation or acquisition of knowledge.

Thus an internal human resource management system or make system contribute to the internal creation of human capital. On the other hand, an external human resource management system or buy system focuses on the acquisition of human capital with specific features. Each system has its own advantages and disadvantages. However we must never forget that the organizational stock of knowledge-based resources is also formed by relational, organizational and technological capital.

The architecture of human, relational, technological and organizational capital plays unique roles in the process of acquiring and integrating new knowledge. As Crossan et al (1999) state, organizational learning is a dynamic process of strategy renewal occurring across three levels of the organization: individual, group and organizational.

These authors propose the “4I Framework of Organizational Learning” focused on the relationships between the three levels of learning and two learning flows. At individual level, the intuiting process takes place. At group level, the interpreting and integrating processes are developed. Finally, the institutionalizing process is the last stage in the organizational learning process. These modes of learning are linked both by social and psychological processes. This framework is operationalized as the strategic learning assessment map (SLAM) and analyzes simultaneously knowledge stocks and flows in the organization. In sum the organizational learning proceeds through a continuous cycle of identifying and interpreting new knowledge at the individual level, integrating and institutionalizing individual knowledge at the collective level, and finally enforcing existing organizational knowledge back on individuals and groups.

Taking all this into account, the Book Knowledge Ecology in Global Business: Managing Intellectual Capital aims to contribute to our vision and also fits excellent with the vision of IGI-global to develop books that are valued by their targeted audiences for their practical implication and the communication of sound propositions. The scholar value of this proposed book in anchored in the following key pillars: 1) Exploiting state of the art and emerging trends in Intellectual Capital, Knowledge Management and Organizational Learning; 2) It provides students and academics as well to other target market an excellent match of theory and practice; 3) It gives an excellent opportunity for discussing some of the hot topics in Intellectual Capital Management and providing fresh ideas on how real world business challenges set new frontiers for IT and management

We also include further readings of a complimentary nature to the contents of the rest of our publication. As an added value to our readers, the further readings are to provide additional related data in support of the book’s comprehensive concepts, principles and results, as well as studies that build upon the appeal of this publication as a one-stop reference source

Author(s)/Editor(s) Biography

Miltiadis D. Lytras has co-edited/co-edits, 25 special issues in International Journals (e.g., IEEE Transaction on Knowledge and Data Engineering, IEEE Internet Computing, IEEE Transactions on Education, Computers in Human Behaviour, etc.) and has authored/[co-]edited 12 books (e.g., Open Source for Knowledge and Learning Management, Ubiquitous and Pervasive Knowledge Management, Intelligent Learning Infrastructures for Knowledge Intensive Organizations, and Semantic Based Information Systems). He is the founder and officer of the Semantic Web and Information Systems Special Interest Group in the association for information systems ( He serves as the (Co) Editor-in-Chief of 12 international journals (e.g., International Journal of Knowledge and Learning, International Journal of Technology Enhanced Learning, International Journal on Social and Humanistic Computing, International Journal on Semantic Web and Information Systems, International Journal on Digital Culture and Electronic Tourism, International Journal of Electronic Democracy, International Journal of Electronic Banking, and International Journal of Electronic Trade) while he is an associate editor or editorial board member of seven more.
Patricia Ordóñez de Pablos is a professor in the Department of Business Administration and Accountability in the Faculty of Economics at The University of Oviedo (Spain). Her teaching and research interests focus on the areas of strategic management, knowledge management, intellectual capital, and China. She serves as an Associate Editor for the Behaviour and Information Technology journal. Additionally, she is Editor-in-Chief of the International Journal of Learning and Intellectual Capital (IJLIC) and the International Journal of Strategic Change Management (IJSCM). She is also Editor-in-Chief of IGI Global’s International Journal of Asian Business and Information Management (IJABIM), as well as editor for a number of IGI Global book publications and full book series.