Knowledge Assets

Intellectual Capital Advisory

Creating, Measuring and Managing

Agenda

• Recap previous modules• Creating knowledge assets• Measuring knowledge assets• Managing knowledge assets• Q&A

What is knowledge?

• Discuss between groups and each develop a working definition

• knowledge defined: “understanding gained through experience or study”

What are knowledge assets?

• Discuss between groups and each develop a working definition

• Knowledge assets = Intellectual Capital = “knowledge which can be exploited for financial or other reward”

Other foundation questions

• Where does Knowledge reside in an organisation?

• Who is responsible for knowledge management

Knowledge Capture

• The process of extracting and capturing the thoughts and experiences of experts

• How?– interviews– questionnaires– observations– brainstorming– writing

Tacit vs explicit knowledge

Source: A D Marwick, Knowledge Management Technology

Codification

• Getting the right knowledge to the right people at the right time– Organising knowledge and presenting it in a

coherent manner– Converting tacit knowledge into explicit

knowledge– Communicating who has relevant tacit

knowledge and how to contact them

KM Concept

People

Content

Technology

Source: Awad & Ghaziri, Knowledge Management

Conventional IC Model

Skandia IC concept

Skandia IC framework

Definition of Intellectual Capital

The factors not shown in the traditional balance sheet...

that are of critical importance to a company’s future success.

What is Measured?

• Business Recipe – Business idea, business strategies, business environment

• Intellectual Property – Patents, licenses, in-house developed software

• Process – Methods, manuals, IT systems

• Employees – Competence, motivation, loyalty, incentives

• Management – Qualities, abilities, management methods

• Network – Business partners and other external connections, contributing to fulfilling company

needs• Brand

– Awareness, attention, differentiation• Customers

– Image, relations, loyalty, potential

When Should You Measure IC?

• M&A – Either prior to selling or buying a company, or as a feature of post acquisition integration, an IC Appraisal will give you invaluable information as to future earnings potential and critical success factors

• Benchmarking – When you have several units you want to compare, either within companies or between companies, IC Appraisals provide you with a standardized tool and terminology

• Organisational Development – An IC Appraisal pinpoints areas to improve and lets you measure improvements consistently over time

• External Reporting – There is an increasing demand for transparency in company reporting. An IC Appraisal complements traditional financial reporting and provides a comprehensive and future-oriented view of your company

How to Measure?

• Extensive individual interviews• Internal & external respondents• Strategic and operational respondents• Structured questions tailored to specific

type of business• Both quantitative and qualitative data

Value Platform

FinancialCapital

BusinessRecipe

HumanCapital

Organisational Structural

Capital

Relational Structural

Capital

The IC RatingTM Framework

IC RatingTM: Three Focuses

Present day

Accounting

1. Efficiency

Present value of IC efficiency in creating future financial value

2. Risk

Threat against present efficiency * probability of threat coming true

3. Renewal and Development

Efforts to renew and develop present efficiency

IC RatingTM Scales

A A A A A A

B B B B B B

C C C C C C

D

Renewal & Development

-

R

R R

R R R

Risk

A A A A A A

B B B B B B

C C C C C C

D

Efficiency

Executive View

Process Management Employees Network Brand Customers

Human RelationOrganisationBusinessRecipe

Intellectual Capital

A BBBBB

BB

CC

A

BBB

BBCC

C

BBB

IP Process Management Employees Network Brand Customers

Human RelationOrganisationBusinessRecipe

Intellectual Capital

A BBBBB

BB

CC

A

BBB

BBCC

C

BBB

IP

A BBB+

A BBB

BB

BBBB

BB

BBB

ACCC

A

Process Management Employees Network Brand Customers

Human RelationOrganisationBusinessRecipe

Intellectual Capital

BBB

IP

A BBB+

A BBB

BB

BBBB

BB

BBB

ACCC

A

Process Management Employees Network Brand Customers

Human RelationOrganisationBusinessRecipe

Intellectual Capital

BBB

IP

-

R

RR-

RRR

RR

RR

-

Process Management Employees Network Brand Customers

Human RelationOrganisationBusinessRecipe

Intellectual Capital

-

IP

RRR

RRR

-

R

RR-

RRR

RR

RR

-

Process Management Employees Network Brand Customers

Human RelationOrganisationBusinessRecipe

Intellectual Capital

-

IP

RRR

RRR

Efficiency Renewal

Risk

Executive View - MatrixE

ffic

ien

cyE

ffic

ien

cy

RenewalRenewal

B

BB

BBB

A

AA

AAA

B BB BBB A AA AAA

Em

Mg

Pr

Bd

Cu

BRNw

CCC

CCC

IP

RiskRisk

Operational View

80

75

79

78

78

73

71

77

57 86

79

54

2511

81

76

56

31

Relation

Interaction

Duration of

Customer Relation

Image CreatingCompetence Enhancing

ProcessStrengthening

StrategicSupplier

Non-vulnerability

Usage Rate

Respondent View

• Categorized document showing comments from respondents

• All comments are anonymous• Provides qualitative feedback and often

useful suggestions for improvement

Q & A

Contact Details

Brett Shadbolt, Managing Director

Censere Group

Mobile +852 9199 9140

E-Mail bshadbolt@censere.com

Website http://www.censere.com