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Unformatted text preview: Chapter 4: Recognizing a Firms Intellectual Assets: Human Capital, Technology and Knowledge, Brands and Trademarks, Relationships - technology, knowledge, human capital, as well as brand names and trademarks, all make critical contributions to a firms competitive advantage and represent an increasingly important proportion of a companys wealth - even in resource-based economies similar to Canadas, success depends on the ability of individual firms to create technological innovations that transform raw materials to value- added goods- indvs often have more loyalty to their peers, including those in competing firms, than they do to their current employer - this makes the social network even more crucial because individuals typically do not work for the same company for a lifetime - strong human capital often leads to useful relationships among others within the firm, promoting a social infrastructure that is vital for gaining consensus on major decisions, integrating multiple administrative levels, promoting co-operation, and sharing information across departmental boundaries The Central Role of Intellectual Capital in Todays Economy - for most of the 20 th century managers were primarily concerned with tangible resources and intangibles such as brands, image, and customer loyalty- most efforts were directed towards efficient allocation of labour and capital- intellectual and information processes create most of the value for firms in large service industries - in the knowledge economy, wealth is increasingly created through the effective management of intellectual assets and knowledge workers instead of by the efficient control of physical and financial assets - the gap between a firms market value and its book value is far greater for knowledge-intensive corporations than it is for firms with strategies based primarily on tangible assets - intellectual capital can be described as the diff between a firms market value and book value the measure of the value of a firms intangible assets - to fully understand the sources of a firms competitive adv, you must first take a close look and analyze how it handles its intellectual capital - Intellectual capital consists of: Intangible assets such as human capital, social capital, intellectual property and brands and trademarks Individual capabilities, knowledge, skills and experience of the companys employees and managers Social capital which involves the network of relationships that individuals have throughout the org The concept of knowledge which comes in two diff forms: explicit knowledge (which is codified, documented, easily reproduced) and tactic knowledge (in the minds of employees, based on experiences & bkrnds)...
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This note was uploaded on 01/26/2010 for the course ADMS 4900 taught by Professor Jungchinshen during the Spring '10 term at York University.
- Spring '10