Intellectual capital (IC), knowledge management and intangible assets are important factors in determining the value of an organization, as reflected in the growth of the knowledge management industry. There is however, a lack of effective measurement techniques to specify and optimize the value of IC. This paper presents a detailed review of existing techniques and establish the need for a more comprehensive approach. The proposed framework addresses IC valuation issues across the IC cycle. People, process, and technology are measured and correlated in the final step with social and financial measures, thus providing a new framework.
Knowledge value added is a new cost accounting technique making waves in intangibles accounting. It helps managers conduct a business process audit. However, the managers need a behavioral tool to understand the factors that influence human capital knowledge value add, in order to increase the organizational value add. This tool helps understand the knowledge professional's perceptions of the organization's culture towards intellectual enterprise, knowledge management support systems and processes, as well as individual value add, the perceived performance, innovation and consequences of quitting. The tool thus helps formulation of strategies towards effective management of human capital and creating higher value add. A leading Indian infotech organization was studied as a case in point and the results are being used to design more effective knowledge management strategies.
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