Strategies for Assessing Organisational Knowledge Assets

Strategies for Assessing Organisational Knowledge Assets

Giovanni Schiuma (Università degli Studi della Basilicata, Italy and Centre for Business Performance - Cranfield School of Management, UK)
DOI: 10.4018/978-1-60566-270-1.ch003
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Abstract

Today’s global business is characterised by interconnectedness, interdependence, and an increasing level of complexity that force organisations to be flexible, proactive, and dynamic. In this emerging global scenario most of the traditional strategies, approaches, and policies no longer work the way they used to. The new challenge, particularly for companies coping with global business, is the ability to drive their transformation into intelligent organisations, that is, organisations that are able to leverage their intellectual capital to achieve their business objectives and envision new development paths. This chapter, assuming that the organisational intellectual capital corresponds to the knowledge assets attributed to a company, discusses the “What,” “Why,” and “How” of the knowledge asset assessment. First, the subprocesses of the assessment are discussed, highlighting the main features of the assessment of knowledge assets as well as the twofold nature of the knowledge asset assessment, distinguishing between stock and flow perspective of the evaluation. Second, the managerial reasons at the basis of the implementation of measurement systems for disclosing organisational knowledge resources are discussed. Finally, on the base of a distinction between the assessment approaches and the evaluation architectures, four main knowledge-asset assessment strategies are defined
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Introduction

Why do companies need to formulate strategies for assessing organisational knowledge assets? And particularly, which is the role of these strategies for global business? These two questions are strictly interdependent and represent an issue for those organisations operating on global scale and aiming to improve their competitiveness. Starting from the recognition of the strategic relevance of assessing and managing intellectual capital in today’s global business, the aim of this chapter is to delineate the possible strategies that organisations can put in place to assess the knowledge assets driving value-creation dynamics.

The relevance of assessing and managing intangible and knowledge assets is emerged as a key concern. Managers have recognised that the competitiveness of their organisations no longer resides in traditional financial and tangible resources. Although they can still represent relevant assets, they are not able to guarantee sustainable and differentiating competitive advantages. The 21st century organisations are realising that most of their capacity to create value does not reside into the traditional tangible and financial assets, but rather than on the ownership and development of organisational intellectual capital (Carlucci, Marr, & Schiuma, 2004; Carmeli & Tishler, 2004; Schiuma et al, 2007). Indeed, the concept of intellectual capital is risen as a key interpretation to denote the overall intangible and knowledge resources at the basis of company’s competencies (Barney, 1991; Carlucci & Schiuma, 2007; Grant, 1991; Liebowitz, 1999; Rumelt, 1984; Wernerfelt, 1984).

Today’s global business is characterised by interconnectedness, interdependence, and an increasing level of complexity that force organisations to be flexible, proactive, and dynamic. In today’s global scenario most of the traditional strategies, approaches, and policies no longer work the way they used to. The new challenge, particularly for companies coping with global business, is the ability to drive their transformation into intelligent organisations, that is, organisations that are able to leverage their intellectual capital to achieve their business objectives and envision new development paths.

The intellectual capital assessment and management is at the cornerstone of the development of new business models that, through the valorisation of intangible and knowledge resources, are able to prompt creativity, imagination, energy, and passion within organisations. These represent the new competitive factors for creating value in the global business.

Traditionally companies have measured economic, financial, and operational performances, while they have disregarded the intangible and knowledge dimensions of their business. As result the value incorporated in a company, as well as the company’s capability to create value, have been usually underestimated. Nowadays, successful companies are those that continuously innovate, take advantage of new technologies, and utilise the skills and know-how of their employees, rather than those companies that leverage their physical assets. In this context, knowledge assets represent the key value drivers in global business. They need to be assessed and managed. In particular, the assessment of knowledge assets plays a fundamental role in global business both to manage the value creation capabilities and to disclose and communicate the value of corporate components.

Complete Chapter List

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Dedication
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
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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
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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
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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
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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
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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
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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
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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
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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
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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
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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?
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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
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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
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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
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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
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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
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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
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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
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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
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About the Contributors