03-05-2012, 01:05 PM
THE TYPOLOGY OF INTELLECTUAL CAPITAL AND KNOWLEDGE MANAGEMENT IN MALAYSIAN HOTEL INDUSTRY
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INTRODUCTION
Factors such as globalization that leads to new technology, free flow of capital, increased competition, the demand for innovation, changes in customer demand, changes in economic and political structures are constantly reshaping the way business is carried out (Buckley and Carter, 2000; Thorne and Smith, 2001). Previous research has acknowledged the fact that organizations have begun to realize that sustainable advantage relies on managing intangible resources such as the knowledge embedded assets. According to Stewart (2002), in the 21st century, knowledge embedded assets have become more important to the organizations than financial and physical assets. Therefore, in order to compete in this millennium, organizations must have the ability to create value, be agile and sensitive to the market.
LITERATURE REVIEW
There is a multi-faceted description of intellectual capital as proposed by intellectual capital theorists. According to Stewart (2002), the term ‘intellectual capital’ seemed to have first appeared in 1958 when two financial analysts reported that the intellectual capital of several small science-based companies is perhaps the most important element in the organizations’ financial statements. The analysts termed the high stock valuations as an intellectual premium (Stewart, 2002), but, for a quarter of century, the idea remains unchallenged. In the 1980s, discussion and debate on resource-based theory had nurtured the ideas of intellectual capital.
INTELLECTUAL CAPITAL AND KNOWLEDGE MANAGEMENT
Edvinsson and Sullivan (1996), Graham and Pisso (1998) and Chen and Lin (2004) have argued that managing intellectual capital is about managing, leveraging and harnessing knowledge embedded in those assets. Intellectual capital can only create value to organizations when knowledge embedded in the intellectual capital is exploited. The three types of intellectual capital: human capital, organizational capital and relational capital can be exploited through intellectual capital management. According to Volpel (2002), the three critical elements in managing intellectual capital are: the strategic imagination and the construction of the intellectual capital; the sharing of meaning emerging from intellectual capital; and the transforming of identifying through the assimilation of the intellectual capital. However, different styles of intellectual capital management can be applied by organizations to effective manage their pool of intellectual capital. The choice depends on organizations’ priorities and capabilities.
MALAYSIAN HOSPITALITY INDUSTRY
The Asian Region is considered to be one of the fastest growing regions in the world in terms of travel, hospitality and tourism. In Malaysia, the hospitality industry has grown tremendously in line with the rapid development of travel and tourism in this country. The tourism sector in Malaysia has risen to the challenges and has emerged as the second largest contributor in terms of foreign earnings towards national income. With a flurry of international events being hosted in Malaysia and the ASEAN region, it is imperative and crucial for investment in human resource as a key factor for growth, sustainability, productivity and profitability in the Malaysian hospitality industry. In line with that, the importance of intellectual capital in hotel industry cannot be disputed.