THE IMPACT OF R&amp;D ACTIVITY ON THE BUSINESS PERFORMANCE OF HIGH-TECHNOLOGY COMPANIES

Intellectual capital (IC) is one of the core determinants of the value of companies, and value creation for stakeholders as well as improvement of the competitiveness of the companies. Effective management of all visible and invisible elements of the total IC is extremely important for business success, since the effective providing, creating, developing and efficient use of intellectual resources affects various business performances, such as income, market share, net profit, and profitability of the company quantified by various performance measures of Return on assets (ROA) and Return on equity (ROE). One part of the total IC is disclosed and visible in the assets side of the balance sheet (Intellectual assets and Goodwill - Iag), while the other, is undisclosed and invisible (Human capital - Hc and Structural and relational capital - SRc). Efficiency in the usage of all these elements of IC has an impact on profitability. The purpose of this research (based on 12 leading companies in the automotive industry from 2010 to 2019) is to examine the interdependence, as well as the influence, of the Efficiency in the use of Intangible assets and goodwill (Eiag) on various rations of ROA and ROE using the EIC (the Efficiency of Intellectual Capital) model for calculation of the Eiag indicator. Although there are numerous studies that use the VAIC methodology to research the interdependence and impact of the efficiency of certain elements of IC on business performance, as well as, in particular, on profitability, the originality of this paper is based on an investigation of the interdependence and influence of Eiag on profitability (ROA and ROE), which is not the case with the studies of other researchers so far, because Pulić’s VAIC methodology does not separate the visible IC component i.e. Iag. The outcomes of this study confirm a positive relationship between the efficiency in the use of intangible assets and goodwill (Eiag) and profitability (ROA and ROE), as well as the growing impact of Eiag on profitability indicators (ROA and ROE). The findings imply the extreme importance of effective and efficient management of all elements of intellectual assets that are visible on the assets side of the balance sheet, taking into account the evident impact on profitability.

show abstract

A model for evaluating the scientific capital of an innovative industrial enterprise

BRAGIN,

VLASOV

2023

EATP

View full text Add to dashboard Cite

Subject. The article addresses the implementation of import substitution policy and development by industrial enterprises of new areas of scientific and technical activity after the departure of foreign companies. Objectives. Our aim is to develop a model for evaluating the scientific capital of an innovative industrial enterprise in a specific area of scientific and technical activity. Methods. The study rests on the systems approach and general scientific methods of analysis, synthesis, abstraction, generalization, and grouping. Resource and competence-based approaches to managing the activities of an industrial enterprise serve as the scientific basis of the research. Results. We present our own model to evaluate the scientific capital of an innovative industrial enterprise, offer an approach to assessing the scientific capital based on determination of the adequacy of enterprise’s resources and competencies to the requirements of a certain area of activity. We also define the sequence of stages for assessing the resource and competence components of scientific capital based on characteristics of the product that form its consumer value (scoring), present a scale of levels of scientific capital, which helps decide if the enterprise has necessary reserve. Conclusions. The developed model is based on determining whether the resources and competencies available to the enterprise meet the requirements of a certain area of activity. The model can be used by the management of an innovative industrial enterprise to determine the feasibility of investing the resources in the development of new areas of activity, strengthening market positions.

show abstract

scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.

Contact Info

hi@scite.ai

10624 S. Eastern Ave., Ste. A-614

Henderson, NV 89052, USA

Blog Terms and Conditions API Terms Privacy Policy Contact Cookie Preferences Do Not Sell or Share My Personal Information

Made with 💙 for researchers

Part of the Research Solutions Family.

THE IMPACT OF R&D ACTIVITY ON THE BUSINESS PERFORMANCE OF HIGH-TECHNOLOGY COMPANIES

Cited by 3 publications

References 54 publications

Business Research and Development Sector: The Ukrainian Dimension

Business Research and Development Sector: The Ukrainian Dimension

Does The Efficient Use of Visible Intellectual Capital Determine the Profitability in the Automotive Industry?

A model for evaluating the scientific capital of an innovative industrial enterprise

Contact Info

Product

Resources

About