Intellectual capital and business performance : a South African study

Abstract

Intellectual capital is an intangible asset. Previous studies found that intellectual capital carries significant potential to improve business performance. The aim of this study was to confirm that this positive relationship between intellectual capital components (human capital, relational capital and structural capital) and business performance, which were previously confirmed in other countries and for isolated industries, also exists in South Africa. The current study has however generalised its analysis over a broad range of industries. This study utilized a questionnaire which was previously administered in Canada and Malaysia. Adaptions of this questionnaire, extending customer capital to relational capital, were later administered in Portugal, Belgium and Luxembourg. A sample of 163 respondents was used for model development and hypothesis testing. The results confirmed previous findings but exposed that a general questionnaire, administered over a wide range of industries, conceals the direct, positive relationship between structural capital and business performance. Although the measuring and management of intellectual capital still poses a challenge; its existence and potential is widely acknowledged. Any competitive advantage, not leveraging from the value of managing intellectual capital, will at most be transient. Keywords: human capital; relational capital; structural capital; intellectual capital; business performance; pls.