Organisational Capital_01c.indd

The terms ‘knowledge economy’ or ‘knowledge society’ have become increasingly accepted, and form part of the management lexicon as recognition grows of the valuable role that intangible assets and knowledge perform in fi rm success. The challenge of managing and developing these assets is nevertheless a real and complex task. Those assets which potentially contribute the most value to fi rms are often diffi cult to measure, given that they are intangible and even diffi cult to identify because of their lack of visibility. While the heightened importance and role of intellectual property is emphasised within a knowledge economy, less transparent is the value of knowledge, which tends to be more tacit and bound up with individuals in the performance of their specifi c task roles. Given that the value of these assets is increasingly assumed in respect of their realised and potential contribution to competitive advantage, the focus of this chapter is the means through which fi rms manage and develop their ‘organisational capital’ over time. In order to address this issue, two perspectives on organisational capital are provided. First, an intellectual capital approach illustrates that research has begun to adopt a dynamic perspective. While the traditional emphasis has been on assessing and measuring an organisation’s intellectual capital, there is increasing appreciation of the need to explore the means through which organisational capital and its constituent knowledge stocks can be developed and enhanced over time. The second perspective presented here is a capabilities-based perspective, which is rooted in the resource-based view. A dynamic approach is implicit in a capabilities-based perspective with the emphasis on organisational process. Given the centrality of organisational adaptation and change to sustaining competitive advantage from a resource-based perspective, recent work on dynamic capabilities directly addresses the issue of ongoing competence development needed for organisational adaptation and renewal.