Intellectual Capital

The concept of human capital is associated with the overarching concept of intellectual capital, which is defined as the stocks and flows of knowledge available to an organization. These can be regarded as the intangible resources associated with people who, together with tangible resources (money and physical assets), comprise the market or total value of a business. Bontis (1996, 1998) defines intangible resources as the factors other than financial and physical assets that contribute to the value-generating processes of a firm and are under its control.

Social Capital 

Social capital is another element of intellectual capital. It consists of the knowledge derived from networks of relationships within and outside the organization. The concept of social capital has been defined by Putnam (1996) as ‘the features of social life – networks, norms and trust – that enable participants to act together more effectively to pursue shared objectives’. The World Bank (2000) offers the following definition:

It is necessary to capture individual knowledge through knowledge management processes, as described in Chapter 12, but it is equally important to take into account social capital considerations, that is, the ways in which knowledge is developed through interaction between people. Bontis et al (1999) point out that it is flows as well as stocks that matter. Intellectual capital develops and changes over time and a significant part is played in these processes by people acting together.

Organizational Capital 

Organizational capital is the institutionalized knowledge possessed by an organization, which is stored in databases, manuals, etc (Youndt, 2000). It is often called

structural capital (Edvinson and Malone, 1997), but the term ‘organizational capital’ is preferred by Youndt because, he argues, it conveys more clearly that this is the knowledge that the organization actually owns.