Тема: INTELLECTUAL CAPITAL AND FIRM PERFORMANCE IN RETAIL INDUSTRY

Nowadays, the importance of knowledge assets in organizations is rising. Intellectual capital, human capital, knowledge-based resources, information assets, knowledge management, intangible assets are the new forms of economic value. Although, the significance of intellectual capital (IC) has increased greatly in the last decades, the majority of organizations do not properly manage IC due to measurement difficulties. Many scholars have argued that IC, which is characterized by intangible assets such as employee knowledge, skills, organizational routines and procedures, has become the preliminary source of competitive advantage for a company. But not only IC gives a competitive advantage to a company it also creates value for it. Therefore, it is intuitively expected that the efficiency of IC measurement and management has a direct influence on a performance of firms, thereby constituting an issue of practical interest to managers and an important area of a research.
The rising importance of knowledge assets is happening due to the shift of economically advanced countries into the “information society” or the “information age”. Through this shift, the role of information and intelligence, embodied in both people and smart machines, becomes pervasive. The newly-formed knowledge-based society is characterized by an application of digital technologies through all aspect of its lives. This application is sometimes called the “digital transformation”. However digital technologies integrate not only into people’s lives, but also into various areas of businesses. In some cases, rapid growth of digital technologies may lead to industry disruption. One of such industries which is going through disruption and which lays in the area of my interest is Retail.
There are a lot of studies devoted to a relationship between IC and a firm performance and scholars employ different IC measurement tools since there is no universally accepted method of IC measurement. The abundance of IC valuation methods and the absence of the universal method make quantitate testing of the relationship challenging. Moreover, there are no studies devoted to the examination of relationship between IC and firm performance in Retail industry.

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The goal of the research was to identify the nature of relationship between the intellectual capital (IC) and its components and company’s performance indicators, which include Gross Margin, Return on Investments and Sales per Employee. The research starts with the examination of the definition of Intellectual Capital and its components with the help of the previous studies. After the IC analysis, the study and comparison of the existed methodologies of IC measurement was provided and the most applicable according to the purpose of the study was selected. The study continued with the brief overview of Retail industry and its trends. After that, the identification of performance indicators of the Retail industry presented and the ones which might have a connection to a IC of retailers were chosen. Afterwards, the empirical investigation on the relationship between IC and performance indicators was performed and the hypotheses were proposed. Through the empirical study the methodology of the study was formulated and the regression analysis was conducted. In the end of the study, some recommendations were proposed with the purpose of efficient utilization of IC in enhancing firm’s performance.
In the first chapter, an overview of the definitions of IC and its three components, i.e. Human, Structural and Relational Capital were presented. In the following part, four categories of IC measurement approaches were defined and compared on the basis of their strengths and weaknesses. The comparison helped to give preference to only those two methods which are most suitable for qualitative testing. After that, all the models of IC measurement within these two methods were examined and compared in the form of a table. As a result, Value Added Intellectual Coefficient was chosen for an empirical study. Thereafter, the VAIC methodology was explicitly studied, its calculation was presented as well as the literature review on the criticism and an application of the methodology.

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