Universities in transition: Managing knowledge and developing people through the use of intellectual capital

Author(s):

Cristina Devecchi(presenting / submitting)Nick Petford(presenting)

Conference:

ECER 2015

Network:

22. Research in Higher Education

Format:

Paper

Session Information

22 SES 03 E, Innovative Perspectives on Teaching and Learning

Paper Session

Time:

2015-09-08

17:15-18:45

Room:

330. [Main]

Chair:

Diana Aguiar Vieira

Contribution

As a result of the fast developing knowledge economy, Higher Education has been at the centre of major changes, which are impacting on universities core activities. In a context of austerity driven changes, the traditional university based on teaching and research does not seem be sustainable any longer either as an educational concept or as an institutional entity. Even the expectation that universities should operate in a Triple Helix system of knowledge production characterized by dynamic trans-disciplinary links between academia, government and industry (Etzkowitz, et al, 2000) is fast losing ground. More recently, and as a response to both the need for economic growth and innovation (EC, 2005; 2014), universities’ new goal is to contribute knowledge, which has social and civic impact (Goddard and Vallance, 2011).

If knowledge is at the heart of economic growth and social impact, then the question is whether universities are equipped to face the challenges of a new economic system based on the capacity of the institution to assess the knowledge within and exploit it to its own and to society’s advantage (Canibano, et al, 2008). Broadly defined as Intellectual Capital (IC), knowledge is an intangible asset comprising human, structural and relation capitals. A variety of models have been suggested in regards to how to manage and strategically lead on the development of IC, such as, Kaplan and Norton’s (1992) Balanced Scorecard (BSC), and models resulting from EU funded projects, such as OEU (2006), RICARDIS (EC, 2006), MERITUM (2002), and the Austrian Research Centers ARC (2005), and the Danish Ministry of Science, Technology and Innovation (2003) Intellectual Capital Statements – The New Guideline.

As the above models are mainly accountability reporting tools focusing on reporting on measurable indicators, there is limited research available on their application to knowledge management in universities. Even those that do, such as Sanchez (2006), serve mainly the need to account for the availability of knowledge resources, mostly in regard to research. Located within a resourcist view (Ricceri, 2008), they compete with an array of other quality assessment measures, thus increasing further both the creation of departmentalised data sets, and the frustration and dissatisfaction of academics (Leathwood et al, 2013) who view such measures as a further threat to their professionalisation. Simultaneously, there is a widespread understanding that the efficient, effective and fair management of human resources through the strategic and focused management of knowledge is the key to efficiency, success, sustainability and innovation as universities face times of turbulent transition.

In this regard, for example, Kaplan and Norton suggest that “learning and growth’, as one of the four perspectives within their framework, is a key performance indicator, but, as Niven (2014) remarks, learning within an organisation is still the least understood and most challenging aspect. New insights have been offered by the work of Ricceri (2008), Barreto (2010) on dynamic capabilities, which Teece et al (1997: 510) define as the exploitation of ‘existing internal firm [sic] specific competences’.

This project contributes to the debate of how universities can manage the transition by drawing from a variety of models for the measurement, assessment and reporting of intangible assets to provide an innovative and transformative set of indicators specifically geared towards assessing human capital. More in detail the study sought to:

• Examine the nature of IC reporting in general and specifically in relation to Higher Education

• Provide an account of IC reporting models and their usefulness by identifying strengths and limitations

• Devise a framework and indicators for the assessment of human capital capacity and delineate areas for improvement with regard to human resource strategic management and development

Method

The study reported here started as a general inquiry on IC, one of the Key Performance Indicators (KPI) in the researcher’s institutional strategy, for the purpose of conducting a survey of staff satisfaction with regard to a specific initiative. As the findings from the survey highlighted a number of issues related with how to assess competences and skills for career progression, a further desk-based critical review of the literature covering a number of areas related to intellectual capital, (i.e., leadership, knowledge management, accounting, business and entrepreneurship) was carried out. The initial scope of the study was broad and exploratory in nature. Given the wide and dispersed foci, a variety of sources such as specialist and general online databases, online journals, open access repository, grey policy related literature, and social media, such as specialised blogs, were used. As a result, a number of models and frameworks, although mainly used for commercial organisations, were retrieved. Two questions arose from the first phase of research: what set of indicators are used in universities? And how can the indicators be used to ensure both competitive advantage and fair management of human capital as the key intangible asset? The scope of the second part of the study, carried out in the Summer 2014, was broadened to include specifically literature on IC and universities, and on the application of IC indicators. While the former highlighted the lack of empirical or theoretical studies, the latter opened up a new area of investigation related to knowledge and human resource management. The initial exploratory purpose became progressively more focused as both depth and breadth was sought in the attempt to provide both useful indicators and means to utilise and develop the knowledge on human capital skills and competences. Mindful of the initial reason why such an enterprise took place, the final part of the desk-top research focused on how organisations can manage knowledge in such a way which is advantageous to the organisation and the individual within it. Since the main finding from the second phase highlighted the importance of both leadership and strategy, and the nature of learning within organisations, the third and final phase of the study focused specifically on the use of the Balanced Scorecard, and specifically literature on organisational learning.

Expected Outcomes

The review of the literature highlighted the following findings: • There is no dearth of literature, models and indicators relevant to IC and related areas in the field of business and commercial organisations. However, there is a gap in our understanding of how to apply such a literature on the management of IC and specifically human resources in universities; • The literature focused on the application of IC models in universities is predominantly interested with stock taking and reporting and while IC reporting models provide a more holistic view of knowledge resources than present evaluation models, they are still firmly located within a static resourcist view; • Simultaneously, the literature on organisational learning provides insights on the development and utilisation of knowledge, but it focuses mainly on human capital as a discrete unit In conclusion, IC as a conceptual construct has the potential to create a single point of reference for the effective and efficient management of knowledge and human resources within a university. However, doing so is complex as it requires universities to undertake the difficult and uncertain transition to a more competitive market model.

References

Barreto, I. (2010) Dynamic Capabilities: A Review of Past Research and an Agenda for the Future. Journal of Management, 36:1, 256-280 Canibano, M. L., Sanchez, P. (2008) Intellectual Capital Management and Reporting in Universities and Research Institutions. Estudios de Economía Aplicada, 26, 2, 7-25 Etzkowitz, H. et al (2000) The dynamics of innovation: from National Systems and ‘‘Mode 2’’ to a Triple Helix of university–industry–government relations. Research Policy, 29, 109-123 Etzkowitz, H., Viale, R. (2010) Polyvalent knowledge and the Entrepreneurial University: A Third Academic Revolution? Critical Sociology, 36, 4, 595-609 European Commission (2014) Research and Innovation performance in the EU. Brussels: EC European Commission (2005) Mobilising the brainpower of Europe: enabling universities to make their full contribution to the Lisbon Strategy. Brussels: EC Goddard, J. and Vallance, P. (2011) The Civic University: Re-uniting the University and the City. In Higher Education in Cities and Regions: For Stronger, Cleaner and Fairer Regions. Paris: OECD Kaplan, R. S. and Norton, D. P (1992) The balanced scorecard – measures that drive performance. Harvard Business Review, January-February: 71-79 Leathwood, C., and Read, B. (2013) Research policy and academic performativity: compliance, contestation and complicity, Studies in Higher Education, 38:8,1162-1174 Niven, Paul R. (2014) Balanced Scorecard Evolution. A dynamic approach to strategy execution. New Jersey: Wiley Observatory of the European University (2006) Methodological Guidelines. Strategic management of University research. Lousanne: PRIME Ricceri, Federica (2008) Intellectual capital and Knowledge Management. Strategic management of knowledge resources. London: Routledge Sanchez, P. et al (2006) The intellectual capital report for universities. In Methodological Guidelines. Strategic management of University research. Lousanne: PRIME Teece, D. J., Pisano, G. and Scheun, A. (1997) Dynamic capabilities and strategic management. Strategic Management Journal, 18:7, 509–533

Author Information

Cristina Devecchi (presenting / submitting)

University of Northampton, United Kingdom

Nick Petford (presenting)