Reshaping business and the world by leveraging knowledge intangibles
Intellectual Capital Management
I am working on Intellectual Capital Management, Please if any person have information how to manage IC effectively in organizations. please shre wid me
Replies to This Discussion
-
Permalink Reply by Mary Adams on
-
I guess I see IC Management as following these steps in a continuous loop:
1-Identify key intangibles related to getting paid, that is, generating revenue for the company.
2-Inventory them including human, structural and relationship capital
3-Model how the system fits together (for this I like to use Legos or client-generated maps -- see Three Ways to Look at IC for examples)
4-Assess how it functions (see Intangibles Measurement series)
5-Identify metrics for execution
6-Execute/learn/adapt to improve
7-Start again at 1
How do you see it?
-
Permalink Reply by Joris g. Claeys on
-
Dear Muhammad and forum members,
Let me first admire your challenge taking on board a PhD in IC. Didn't even know that existed already, so maybe you can share the group a bit about this.
Mary gives a very good introduction on how to go about or even start with IC in a corporation or university, NGO, government institution, etceteras. The re-iterating circle is a given, same as it applies for e.g.: standard accounting, continuous improvement, LEAN, etceteras.
Some CEO/CFO we speak with, want to start "yesterday" with an IC driven organization, mainly because it is trendy. Only few understand how IC can turn around their organization in a future-growth-driven operation at all levels of the corporation and not just inform but influence stakeholders at all levels of the extended enterprise. So, it first of all depends on where your management and team perception is on the life-cycle of accepting and understanding IC and what it does and not does.
That starting point is already worth a PhD research and thesis, so if you have colleagues or students that are interested, give them a hint. A new world will open and also that is essential because the generation which is now undergoing education is going to pull corporations, governments and communities forward in the new Knowledge age, which will amongst many new exciting things also include IC. The current 3 generations in the workforce however are smoothing the path for entry of IC and definition of IC. This includes for example also the introduction to new guidelines by all concerned standards bodies, the addition or make-over of regulations at para- and national legislation, adapting the perceptions by financial analysists and exchange journalism, the exchange mechanisms themselves, etceteras. So in short, we are all facing challenging but very interesting years ahead of us.
It is also our believe that IC is ready to the big bang - I mean practical realization: +20 years of development, concepts and practice, political awareness at a large scale and then there is the financial crisis which on short term took the attention away from IC, but that is rapidly turning around now: recognizing IC as way forward in managing our intangibles, which have been forsaken for decades, if not centuries. This forum is a great initiative to bridge the gap, but there is more and there is more work on shop to make it all happen. Jump on the wagon I would say!
Even if there is for example a well increasing awareness at the political and legislation level across borders, there is still not a real action plan on how to value (common valuation practices, institutional guidelines and legislation) the intangibles. Who are the front runners: EU as a whole, France being the top inspirer from a government and national economics perspective (remember the French translation of "management" = gouverner, prevoir, direction), Germany has an active legislation and Sweden is trialling their unique industry geared model. But it doesn't end there: countries such as Italy, Canada and even emerging economies are further then we think: India has its legislation already adapted and ready to go in practical implementation, Thailand is looking over the shoulders of what is happening in the European leading countries, adapting the legislation for IP and IPO actively involving the Exchange. Same in HK ... and of course there is the silent giant China. China's latest 10-year economic plan uses IC-guidelines and KM implementation to transform from a low-manufacturing economy to a value-added economy. And guess what: we see the results, some people prefer to be blind, but it is happening.
So yes the importance of IC and its practicum is happening and now I have steered away too far from your initial question "how to manage IC "effectively" in an organization. I like the bolded word you almost like sneaked into your question. Cause what is effective exactly? On its own that is an intangible which we should measure :)
And in effect, that is exactly what AREOPA does, but it starts much earlier then that. Companies, who want to jump the trend and implement IC, find themselves often stuck. Why is that? Most of the time not because of the complexity of IC (principles are very straight forward but capturing and measuring the phenomena is another matter), rather because of the fact that nowhere in the organization’s history the entire team and its business processes have been able to think in terms of hard currency or monetary value. ABC costing is the closest that ever was brought into practice to evaluate business processes, improvement of those and future projection of new practices. But how often does it happen in practice. Most project driven organizations still drop the measurement of intangibles or put a couple of nice-sounding management-talk on it and get away with it.
So the first thing to change is managing change, resistance, perceptions ... and show the value of valued project-driven operations. That is where most organizations find out that they have to take a step back. That is why AREOPA has made a clear choice in bringing our methodologies to market in very related but differentiating areas when it comes to content and approach: Change Management, Risk Assessment, Knowledge Management and then Intellectual Capital. Now, this does not mean that any organization needs to go by definition through that cycle. There are many ways to implement IC practicum based on what is available in the company. And let’s be honest: while 100 different types of company audits exist (Financial, ITIL, SOX, COBIT, ISO, etceteras), about 80% of the data for all these audits come from the same sources, only the interpretation of the collected data is different.
So much of what is needed for IC is available already. For those companies, who have adapted to valued-project-driven organization models, are steps ahead. If one then also masters (or has trading experience) the market valuation of tangible and intangible has opened the door for IC calculation. The result of that is then reported in the IC accounting. So the last two are only tools to achieve the end result. What happens prior to that, starting from adapting the culture, perception awareness, resistance, and practicing managed KM is where the real challenge lays for any company. Some have done much already in these areas. So it is a matter of recognizing those achievements first and identify how it can be leveraged going forward in KM and ultimately in IC.
So our recommendation is: do not re-invent the wheel, much is right in front of you, ready to be grabbed to activate IC.
In this respect, I advise to read the white paper I published here on ICKC titled “Measuring the IMMEASURABLE” by Ludo Pyis – Founder and President of AREOPA.
AREOPA has broken the code, as many in the industry confirm. Nevertheless, the go-to-market is as important, that is one of the reasons why AREOPA transformed from a consultancy practicum to a knowledge and practice provider.
This is the point where I can’t resist and I hope many see it as a potential roadmap to moving in IC, publishing AREOPA’s unique selling proposition for Intellectual Capital Management, but still recall that it starts with leveraging what you already have and adapting to a corporate culture around IC as it involves all or most people within an organization. Some are going a step further and involve suppliers, customers and the customers of their customers (= Extended Enterprise). But step by step for everyone who wants to engage in these fascinating phenomena of IC – I was just joking about that last one . But here are some of the unique approaches by AREOPA:
Today, the intangible assets of the knowledge economy become more and more important. Areopa is the only company in the world offering a real monetary valuation system for intellectual capital calculation and accounting.
Entirely based on existing IAS 38 international accounting standard guidelines for intangible valuation.
Total system based on classical accounting concepts, such as balance sheets and P&L statements, and fully integrated and look-alike reporting view.
AREOPA has developed a completely new accounting framework – ICARUS® – for this knowledge based system, with new rules, journal entries, inventory valuation, etc.
IC Calculation (ICC) is based on AREOPA’s 4-Leaf Model® (Human Capital, Structure Capital, Customer Capital, and Alliance Capital). An econometrics approach has identified 77 Added Value Creating Phenomena (AVCP), based on 920 parameters and variables. It defines the total IC value of an organization.
Anyone interested to know more about AREOPA, feel free to contact me or Ludo Pyis.
Best regards,
Joris Claeys
VP Global Operations
AREOPA - Provoking Innovative Intelligences
Joris.Claeys@AREOPA.com - Attachments:
-
Permalink Reply by Muhammad Khalique on -
Respected Joris g. Claeys
Thank you very much for your kind response and well come me in a productive platform of intellectual capital. I would like to say my thanks to Mary Adams for welcome. She is admirable lady who arranged a beautiful forum where we can learn and share our idea.
Secondly Sir, thank you for your gift, I like you article and I think its your first gift not last.
I am student in IC field and I want to do some solid and concrete contribution in this field. I agreed with you in IC field we are facing challenges. I like to face challenges. I am also studying the economic and socio political impact on implementation of IC in organizations and effective utilization.
I hope you will have data about the factor of socio economic or socio political factor or questionnaire. Please help me in this regards
If any member have research or data questionnaire form please share wid me
With best regards
Khalique
-
Permalink Reply by Dr Gerhard Kristandl on -
Joris, let me thank you for this - dare I say it - fantastic contribution. Similar to Muhammad, I consider myself still a beginner in IC, with the drive for contributing quite considerably to the subject. After 2 1/2 years of "forced" abstinence from IC, I am currently attempting my return to it, so again: thank you for a contribution like this! It is most help- and insightful!
Kind regards,
Gerhard
-
Permalink Reply by Göran Roos on -
You can have a look in the book:
Roos, G., Pike, S. and Fernström, L., “Managing Intellectual Capital in Practice”, Butterworth-Heinemann, an imprint of Elsevier, USA, 2006
or for some of the key sub topics have a look at any of the following refereed journal articles:
International Journal of Accounting, Auditing and Performance Evaluation (IJAAPE), Special issue on Intellectual Capital, Vol. 4, No. 4/5, 2007.
Management Consulting Practice in Intellectual Capital Special Issue of Journal of Intellectual Capital, Vol. 6, No. 4, 2005. pp. 588-614.
and go through all the back issues of:
International Journal of Learning and Intellectual Capital and Journal of Intellectual Capital
-
-
As we begin to create a vision for this site, I would like to submit that I hope it can become a place where mainstream business people can come and actually find answers to the question posed by Muhammad: How to manage IC effectively in organizations?
Yes, there is already a lot of research available. But it is not that accessible to a busy businessperson.
I believe that IC Management will one day be called Management 2.0 or Knowledge Era Management. In other words, this is the future of management and it will be a very broad field.
However, I also believe that there are simple principles that already are known and that can be very powerful. In my own work, just laying out a summary chart of the critical value creation intangibles often helps clients achieve breakthrough thinking. Add to that a discussion of the near-infinite scalability of structural capital...and businesspeople quickly become believers.
What's the best way to do this? How can we build a site that tells this story? Answer here or in our Community Discussion or comment on the idea I posted on creating Guides.
About
© 2010 Created by Mary Adams on Ning. Create a Ning Network!
