INTELLECTUAL CAPITAL & KNOWLEDGE MANAGEMENT

Fachochshule Frankfurt an Main

March -2008, Sept.-2009

18th-27th, March-2013

Prof. Dr. Irene Martín Rubio

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INTELLECTUAL CAPITAL & KNOWLEDGE MANAGEMENT

1. Introduction• Knowledge Age & Innovation1.1. The concept of Organization

2. Knowledge Management• Data, Information, Knowledge, Competence• Spiral of Knowledge• Tacit vs. Explicit Knowledge• CKO: Chief Knowledge Officer

3. Organizational Learning• Learning Organization vs. Organizational Learning• Single Loope Learning vs. Double Loop Learning• Activities of Organizational Learning• Learn to Learn, Routines, Trust, Team Management

4. Intellectual Capital• Valuation of the Firm• Components of the Intellectual Capital Report• Intellectual Capital Navigator

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OUTLINE

Why are we here?

Duplicity – Movie Trailerhttp://www.youtube.com/watch?v=3KqDuvMANb8

Duplicity- Why are we here?

http://www.youtube.com/watch?v=GfoSukpWVos

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INTRODUCTION

Knowledge Age & Innovation

The Coming of New Organizations

1.1. The concept of Organization

Why study organizations? Effectiveness Organizational Structure and Organizational Design Organizational Design Theory Contemporary Trends

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21st Century Innovation Management

The high demand for new ideas and new product concepts in the knowledge economy posed a major challenge to the organizational innovative ability.

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New sources of growth: Knowledge-based capital

http://www.oecd.org/sti/industryandglobalisation/newsourcesofgrowthknowledge-basedcapital.htm

http://ec.europa.eu/invest-in-research/policy/capital_report_en.htm

http://www.research-in-germany.de/main/research-landscape/rpo/networks-and-clusters/41830/10-2-leading-edge-cluster-competition.html

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KNOWLEDGE AGE

“We soon discovered how essential it is for a multibusiness company to become an open, learning organization.

The ultimate competitive advantage lies in an organization’s ability to learn and to rapidly transform that learning into action”.

Jack Welch – GE (1998)

!!!! AGILITY

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KNOWLEDGE AGE

“Information and knowledge are the thermonuclear competitive weapons of our time. Knowledge is more valuable and more powerful than natural resorces, big factories, or fat bankrolls”

Thomas A. Stewart –Intellectual Capital

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KNOWLEDGE AGE – INNOVATION MANAGEMENT

LIBERATING INNOVATION FROM BEING THE FUNCTION OF ONE DEPARTMENT (R&D or NPD New Product Develpment) TO AN ACTIVITY TO WHICH EVERYONE CONTRIBUTES.

INNOVATION MANAGEMENT PROGRESSED INTO MANAGING AN INNOVATION PORTFOLIO ACROSS A SET OF DISPERSED INTERNAL AND EXTERNAL NETWORKS.

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KNOWLEDGE AGE – SOCIAL CAPITAL & INNOVATION

Innovation Management involves knowing the skills and competencies of employees across the whole organization (HUMAN

CAPITAL) and potential partners (SUPLIERS & CUSTOMERS-

RELATIONAL CAPITAL) to forge the alliances that facilitate the innovation

process. !!! Enabling allocation of human and financial

resources to meet stratetic prioriries

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KNOWLEDGE AGE Success in the Knowledge Age demands that we have the

forsight and courage to let go of the Newtonian clockwork or machine metaphor on which most of our organizations are still founded and embrace the logic of self-organization or unmanagement.

INDUSTRIAL AGE: Control and dissemination of explicit knowledge –facts,instructions, rules and procedures- by the privileged few. Organizations as machine. Hierarchical and Bureacratic Organizations Machine logic (control and predictability logic

KNOWLEDGE AGE: Tacit Knowledge: expertise, reasoning, judgment and insight. Organizations as collective brain power (SOCIAL CAPITAL) Bio-logic

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KNOWLEDGE AGE - ORGANIZATIONS

Bio-logic Social organizations are incompatible with formality,

distance and contractualism if we want to explore and explote creativity (the human nature).

Social organizations proceed smoothly onl with intimacy, subtlety and trust.

PEOPLE are not simple a means of production. They are biological systems constantly seeking to fulfill their needs and aspirations.

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KNOWLEDGE AGE

We have entered and era where knowledge is the primary source for wealth creation.

We now need to be comfortable with perceptual change, uncertainty, and complexity of our own making.

It requires an in-depth understanding of our evolved human qualities and the quest of serendipitous self-organizing systems or bio-logic.

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The coming of New Organization (P. Drucker)

Information & Communication Technology

Little Middle Management A good deal of work is done in ad hoc

teams as required by every project Flat Structures

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The coming of New Organization (P. Drucker)

Evolutions in the concept and structure of organizations

1. Beguining XX century• G. Siemens, Germany• Differentiation management from ownership

2. 20’s: Modern CorporationDu Pont, General MotorsCommand-and-control organizationOrganization of departments and divisions

3. 90’sThe organization of knowledge specialistsCKO (Chief Knowledge Officer

Data, Information, Action, CompetitivenessMotivation, Imagination, Creativity : HUMAN NATURE

Increasing intellectual capital cannot be managed in the traditional sense, sit all sorts of new-age technologies and associated elaborate metholodgies 15

KM, IC, OL

OL

KM

IC

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Knowledge Management

Intellectual CapitalOrganizational Learning

INTELLECTUAL CAPITAL & KNOWLEDGE MANAGEMENT

1. Introduction• Knowledge Age

2. Knowledge Management• Data, Information, Knowledge, Competence• Spiral of Knowledge• Tacit vs. Explicit Knowledge• CKO: Chief Knowledge Officer

3. Organizational Learning• Learning Organization vs. Organizational Learning• Single Loope Learning vs. Double Loop Learning• Activities of Organizational Learning• Learn to Learn, Routines, Trust, Team Management

4. Intellectual Capital• Valuation of the Firm• Components of the Intellectual Capital Report• Intellectual Capital Navigator• Case Studies

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Accounting

Balance Sheet

ASSETS = Equity+Liability

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Assets

Non –current assets

Current Assets

Equity

Liabilities

Non-current Liabilities

Current Libilities

Application of resourcesINVESTING

Source of financial resourcesFINANCING

NON-CURRENT ASSETS

TANGIBLE ASSETS Land, building, furniture, equipment… Physical substance. This assets can be

bought or manufactured by the company INTANGIBLE ASETS

Assets without physical substance RESEARCH & DEVELOPMENT

Research, development, patento GOODWILL

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GOODWILL

It is an intangible asset that compromises the value of all favourable attributes related to a business enterprise such as exceptional management, skilled employees, highly quality products, good and faithful customers… which are very difficult to valuate separetely.

It is calculated as the excess of the cost over the fair market value of net assets acquired.-

In general, goodwill is not amortized because it is considered to have limited life, but it is reviewed for impairment every year.

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Intangible Assets

Intangible Assets Often fuzzy property rights

Interactions Teams & equipments& clients Infrequent market transactions Low General Awareness of transaction

oportunity High Possible Strategic Value

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INTELLECTUAL CAPITAL

How to manage goodwill? IC-OL-KM How to manage intangible assetss? How to manage innovation?

KM: KNOWLEDGE MANAGENT

How to measure IC?22

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