The Positive Effect of Green Intellectual Capital on Competitive Advantages of Firms

No research explored intellectual capital about green innovation or environmental management. This study wanted to fill this research gap, and proposed a novel construct – green intellectual capital – to explore the positive relationship between green intellectual capital and competitive advantages of firms. The empirical results of this study showed that the three types of green intellectual capital – green human capital, green structural capital, and green relational capital – had positive effects on competitive advantages of firms. Moreover, this study found that green relational capital was the most common among these three types of green intellectual capital, and the three types of green intellectual capital of Medium & Small Enterprises (SMEs) were all significantly less than those of large enterprises in the information and electronics industry in Taiwan. In sum, companies investing many resources and efforts in green intellectual capital could not only meet the trends of strict international environmental regulations and popular environmental consciousness of consumers, but also eventually obtain corporate competitive advantages. Dr. Chen is an assistant professor in the Department of Business Administration in National Yunlin University of Science & Technology in Taiwan. His research focused on management of technology, innovation management, corporate environmental management, and patent analysis.     

The significance of human capital and social capital: professional–client relationships in the Asia Pacific

Professionals working in professional service firms rely on their human capital and social capital to deliver value in their service provision and delivery to clients. However, research to-date is limited regarding investigations into the relationship between human capital and social capital at the level of professional–client relationships, particularly in the context of the Asia Pacific where changes in business environment, professional jurisdiction and ways of working have been commonplace for many firms operating in this region. In this study of Australian corporate law firms and client organizations, our results reveal significant evidence of relationships between social capital and human capital in the form of knowledge acquisition, where social capital facilitates professionals’ capacity to acquire knowledge from clients and increases the overall amount of knowledge acquired. More research on social capital and knowledge acquisition has the potential to advance our understanding of the influence of professional–client relationships on human capital development in the Asia Pacific.     

The impact structure of social capital on corporate performance: Empirical evidence from listed companies in China

Vertical relationships with the government, particular relational capital and organizational social network capital, constitute corporate social capital (CSC). Using the empirical data of 97 listed companies in China, this paper examines the impact of CSC on corporate performance, finds that CSC has a positive impact on sales revenue but an insignificant impact on the improvement of ROA. More specifically, when a firm enlarges its sales revenue, the function of organizational network capital is stronger than that of a particular relational capital and that of governmental connections. The paper also finds that state-owned enterprises (SOEs) have more advantages in using governmental connections, therefore leading to better social status than non-SOEs do, who have fewer advantages in using any particular relational capital. The article suggests that managers should appraise carefully the effectiveness of CSC, and combine it with other resources; firms should distinguish the structure of the impact of CSC on performance improvement in a dynamic way. With respect to the implication of this paper, it could help in analyzing firm behaviors in the transitional China. Translated from paper in International Symposium on Entrepreneur Research and Education, 2006, April (in Chinese)     

The role of intellectual capital and university technology transfer offices in university-based technology transfer

This study develops a theoretical model to explain the relationships among intellectual capital, research outcomes, and technology transfer (TT) performance, investigating the role of university TT offices (UTTOs) in the innovation process. The authors examined these relationships by sampling 49 Taiwanese universities within a 2-year period. It is concluded that universities with specialized UTTOs indeed promote TT performance (TTP) based on university–industry cooperation. Furthermore, the results indicate that human capital is positively associated with research outcomes and relational capital. The greater the amount of relational capital, which represents the degree of university–industry cooperation, the more significant is the positive effect on research outcomes and TTP. The more research outcomes are produced, the more academic research and patent technology will be transferred to industry.     

Social capital in relation to the foreign market entry and post-entry operations of family SMEs

Scholars in the discipline of international entrepreneurship have mainly studied rapidly internationalizing firms. However, the majority of entrepreneurial firms are family-owned businesses (85% of all firms in the EU and the USA). Research on family business has focused on the importance of bonding social capital whereas, despite its importance, bridging social capital has not so far attracted much attention. It has been argued that bridging social capital plays an important role in firms’ internationalization processes. The purpose of this article is to examine the role of bridging social capital in the initial entry and post-entry operations of eight family SMEs with regard to the French market. We found that in foreign market entry social capital generally had a serendipity role, based on weak and intermediary relationships. In the post-entry situation, the role of strong and formal ties emerged strongly, and social capital most commonly took on efficacy or liability roles. Thus, it seems that the social capital of family entrepreneurs is limited to their strong bonding social capital, and perhaps to their strong national social capital. However, when such firms start to internationalize, they have to find new networks to gain the bridging social capital that will enable foreign operations. It seems that having a limited number of international ties drives family SMEs to search for relevant contacts at international trade exhibitions and trade fairs.     

Social and Symbolic Capital and Responsible Entrepreneurship: An Empirical Investigation of SME Narratives

This paper investigates links between social capital and symbolic capital and responsible entrepreneurship in the context of small and medium enterprises (SMEs). The source of the primary data was 144 ‘Business Profiles’, written by the owner-managers of small businesses in application for a Small Business Awards competition in 2005. Included in each of these narratives were claims relating to the firms’ contributions to wider society, relationships with customers, employees and stakeholders. These narratives were coded and classified in a framework drawn from Nahapiet and Ghoshal’s (1998, Academy of Management Review 23(2), 242–266) categorisation of social capital. The analysis revealed a range of strategic orientations towards the development of social and symbolic capital, along a conceptual continuum ranging from being responsible for oneself to being responsible for others. Overall, the evidence demonstrates the significance of the power inherent in the social relations of SMEs as a force for ethical behaviour, and suggests that normative theories of the development of social capital may provide ‘competitive advantage’ through responsible behaviour for small business in the global economy.Ted Fuller is a Professor of Entrepreneurship and Strategic Foresight, and Head of the Centre for Entrepreneurship and SME Development, Teesside Business School, University of Teesside.Yumiao Tian is a postgraduate research student in the Centre for Entrepreneurship and SME Development, Teesside Business School, University of Teesside.     

The influence of international networks on internationalization speed and performance: A study of Czech SMEs

Drawing on social capital theory and the international entrepreneurship literature, we develop hypotheses relating the structural, cognitive and relational aspects of the international network of SME CEOs to two internationalization outcomes – speed and performance. The study is based on a sample of 155 Czech SMEs covering a broad range of manufacturing industries. Our findings indicate that firms sharing a common language with their international ties are able to internationalize faster than firms that do not share a common language. Moreover, we observe that geographically diverse networks contribute to superior performance. Extensive reliance on personal contacts hinders the performance of the first international venture.     

How social capital and knowledge affect innovation

This research analyzes the effects of interorganizational links on radical innovation using a comprehensive framework that integrates three research streams: social capital, the knowledge-based view and innovation. Incorporating data from 143 companies of innovative manufacturing and service industries, our results show that while knowledge complexity per se exerts a clear influence on radical innovation, the effect of knowledge tacitness appears only in combination with social capital. Similarly, the mere existence of strong cooperation agreements (relational social capital) does not guarantee more radical innovations, only when combining high levels of social capital with tacit knowledge does this antecedent produce more radical innovation.     

University start-up formation and technology licensing with firms that go public: a resource-based view of academic entrepreneurship

Although academic entrepreneurship is a topic receiving some attention in the literature, higher education's appetite for expanding technology transfer activities suggests that more research is needed to inform practice. This study investigates the effects of particular resource sets on two university commercialization activities: the number of start-up companies formed and the number of initial public offering (IPO) firms to which a university had previously licensed a technology. Utilizing multisource data on 120 universities and a resource-based view of the firm framework, a set of university financial, human capital, and organizational resources were found to be significant predictors of one or both outcomes.     

Corporate Entrepreneurship and Codification of the Knowledge Acquired from Strategic Partners in SMEs

This work proposes that the level of codification of acquired knowledge positively influences the corporate entrepreneurship activities of SMEs and argues that this relationship is enhanced by the relational diversity of the partner that provides the knowledge and the strength of the relationship with this partner. The results obtained in a sample of 181 Spanish SMEs in the ITC sector confirm the hypotheses proposed. This research contributes to the corporate entrepreneurship literature by showing which types of knowledge (codified), sources of knowledge (the most important strategic partner), and relational conditions (tie strength and partner's relational diversity) can enhance corporate entrepreneurship.     

Effects of relational capital and commitment on venture capitalists' perception of portfolio company performance

In this study, we examine how relational capital and commitment affect a venture capital firm's (i.e., VCFs) perception of the performance of its portfolio companies (i.e., PFCs). That is, we examine how perceived performance is affected by the social nature of the relationship between the VCF and PFC. The study's hypotheses are tested by applying quantitative analyses to survey data collected from 298 U.S.-based venture capital firms. The data from the survey are complemented with additional information drawn from secondary data sources and interviews with several venture capitalists. We found that the amount of relational capital embedded in the VCF–PFC dyad and the extent to which the VCF is committed to the PFC are strongly related to perceived performance. We speculate that relational capital and commitment enhance learning, an effect that increases VCFs' perceptions of performance. Further, these perceptions of performance will also be amplified by the positive affect generated by relational capital and commitment. We discuss the limitations and contributions of our findings and provide directions for future research.     

If the Supplier's Human Capital Walks Away,Where Would the Customer Go?

Purpose: Professional service firms' clients often develop stronger attachments to their key contact employee than to the service firm. Since professionals are highly mobile, buyers of professional business services constantly have to decide whether to follow their key contact employee or remain with their incumbent firm, while service firms face the threat of losing customers if the employee leaves. This study examines how the key contact employee's human capital, the social capital between the contact employee and the client, and the service company's structural capital affect the decision whether to follow the key contact employee to another professional service firm.

Methodology/approach: The model is tested on a sample of 120 organizational buyers of advertising services by using partial last squares, a structural equation modelling technique.

Findings: Professional service firms' investments in company-specific structural capital create a deterrent for clients to follow the contact employee, because remaining with the service firm will increase clients' return on the service providers' structural capital. Furthermore, higher levels of structural capital reduce the value of the contact employee's investments in human capital should the employee leave. Conversely, human capital creates motivation to follow the contact employee, while social capital only provides value in combination with human capital.

Research implications: This study employs concepts developed in economics and economic sociology rather than relationship marketing variables to examine attachments to individual professional service providers and to professional service firms.

Practical implications: The findings underline the importance of competence, both at the company and individual level, for retaining clients of professional services. These results contrast previous studies emphasizing close interpersonal relationships and service firms' relationship-building activities.

Originality/value/contribution: Human, social, and structural capital provide value to clients and therefore apply well to professional services. Hence, these variables provide alternative explanations to service firms' client retention or desertion than traditional relationship marketing variables do. The findings add to our understanding of service provider–client relationships in professional services and knowledge intensive firms.     

Human capital and structural upheaval: A study of manufacturing firms in the west bank

Firms in various worldwide locations are repeatedly subjected to radical political, economic, and social upheavals, including changes in administrative governance, new economic paradigms, natural disasters, and warfare. Perhaps because of the difficulty of conducting research in these environments, little is known regarding the unique requirements of entrepreneurs and their business organizations in such troubled locations. Reliable research and information is necessary in order to design and assess methods of providing institutional support both during, and after, such turmoil.Based on data collected from field interviews over a six-month period, this article examines the characteristics of the owners of 64 small manufacturing businesses that have undergone or were experiencing radical political and economic upheaval in the West Bank town of Ramallah in the Palestinian Territories. The objective of the study is to examine characteristics that influence and assist an entrepreneur's resource allocation decision-making processes. This was done by comparatively assessing the effects on profitability of both firm and individual assets in a highly constrained rapidly changing environment. Understanding this allocation process will lead to more effective targeted assistance in regions experiencing or exiting environmental transitions and upheavals.Human capital theory is utilized in this study as a framework for understanding the comparative response of owners to reallocate resources under the stressful environment of the pre- and post-intifada West Bank territories. While human capital has been well studied in literature examining resource allocation in “typical” competitive environments, our understanding of the influence of human capital in transitional environments is quite limited.This study provides some useful, and perhaps surprising results, from both theoretical and practical perspectives. Owner's human capital (coded from formal education) was found to impact profitability only with the micro firms studied (those with three or fewer employees), however, it is possible that this finding reflects dilution of human capital in comparatively larger small and medium-sized enterprises (SMEs). One interesting departure from similar studies is that experience was not found to affect the profitability of the firm. Plant capital, on the other hand, was found to be associated with the profitability of only larger SMEs, controlling for business age and experience of the owner. This finding is significant because, presently, institutions such as the World Bank, NGOs and national development agencies focus their efforts primarily on providing credit to small businesses, whereas training and education currently are somewhat out of favor.A model is proposed in this study comparing resource requirements according to both the size and the productivity/technological level of the firm. The object is to explain the reduced importance of human capital and experience in environments of radical transition, specifically the arbitrary nature and lack of predictability of transitional governance, and the increased importance of financial capital only with large SMEs. It is argued that skills acquired in functional expertise do not necessarily prepare an entrepreneur for the abrupt environmental transformations characteristic of tumultuous political events. This research suggests that owners are in a better position to maximize their cognitive skills in decision making within smaller organizations. However, these skills are naturally diffused and so less effective at influencing the outcomes of somewhat larger organizations. Larger SMEs are necessarily more capital intensive and more bureaucratic, and so the cumulative human capital at the organizational level may be more important to allocative efficiency than the human capital of the individual firm owner. Further, larger SMEs require organizational expertise that may not be captured in the individual level characteristics of entrepreneurs.This research suggests that efforts to support such environments should carefully consider the size of the firms in question before designing and implementing programs of assistance, differentiating microenterprises from small businesses. In particular, the findings of this study suggest that smaller firms experiencing rapid environmental upheaval will benefit most from formal education, training and advice. Larger firms, in contrast, appear to benefit most from loans providing traditional capital support, and from advice across the entire firm's human capital base, particularly regarding organizational management and delegation skills.     

Why do firms seek to share human resource management knowledge? The importance of inter-firm networks

This study untangles the social processes and inter-firm mechanisms underlying human resource management (HRM) knowledge networks. The research questions serve to advance understanding of why HRM knowledge flows between firms under contractual relationships and in the absence of formal relationships. The study analyzes data from a complete network of 51 high-technology firms located in a science and technology park to report the structural properties and relational dimensions of inter-firm flow of HRM knowledge. The results from this social network analysis show that the firms in the study actively engage in the sharing of HRM knowledge. Specifically, the results not only indicate the preeminence of formal ties but also of relational factors relating to firm legitimacy, prestige, and collaborative interaction. Participation in inter-firm knowledge networks appears to be an effective tool for obtaining HRM knowledge as well as for enhancing legitimacy and prestige between firms and developing trust and reciprocity within collaborative relationships.     

Capital structure of SMEs in Spanish regions

This article examines whether the capital structure of small and medium-sized enterprises (SMEs) and its firm-factor determinants are different across regions belonging to a single country. This subject is relatively innovative in capital structure research, since the majority of the studies carried out in a single country have neglected to take into account the region in which firms operate to explain leverage. To this end, we study whether the capital structure and its firm-factor determinants—size, asset structure, profit, growth, and age—differ depending on the region in which the SMEs are located. For the empirical analysis, panel data methods are applied to a sample of firms from all regions of Spain for the period 2004–2007. Our results not only suggest that there are regional differences in the SMEs capital structure but also confirm that the impact of firm-factor determinants on leverage differs across regions in terms of signs, magnitudes and significance levels.     

Entrepreneurial orientation,social capital,and the internationalization of SMES: Evidence from China

This article combines arguments from entrepreneurship literature and social capital theory to examine the antecedents to the internationalization of small and medium‐sized enterprises (SMEs) from China. Our quantitative study of 117 Chinese SMEs demonstrates the overall importance of entrepreneurial orientation and social capital of entrepreneurs in facilitating their internationalization efforts, and also reveals that different dimensions of entrepreneurial orientation and different types of social capital exert different levels of independent influence on Chinese SMEs' internationalization. Complementary data from multiple case studies explains the variation between our quantitative findings and the findings of previous research. By highlighting the value of the entrepreneurial attributes of Chinese SMEs and the social capital embedded in their networks in the pursuit of their internationalization, the article adds to the scant literature on the internationalization behavior of the rapidly emerging Chinese SMEs. © 2012 Wiley Periodicals, Inc.     

Human capital and entrepreneurial success: A meta-analytical review

The study meta-analytically integrates results from three decades of human capital research in entrepreneurship. Based on 70 independent samples (N = 24,733), we found a significant but small relationship between human capital and success (r_c = .098). We examined theoretically derived moderators of this relationship referring to conceptualizations of human capital, to context, and to measurement of success. The relationship was higher for outcomes of human capital investments (knowledge/skills) than for human capital investments (education/experience), for human capital with high task-relatedness compared to low task-relatedness, for young businesses compared to old businesses, and for the dependent variable size compared to growth or profitability. Findings are relevant for practitioners (lenders, policy makers, educators) and for future research. Our findings show that future research should pursue moderator approaches to study the effects of human capital on success. Further, human capital is most important if it is task-related and if it consists of outcomes of human capital investments rather than human capital investments; this suggests that research should overcome a static view of human capital and should rather investigate the processes of learning, knowledge acquisition, and the transfer of knowledge to entrepreneurial tasks.     

Entrepreneurial orientation, management commitment, and human capital: The internationalization of SMEs in India

Small- and medium-sized enterprises (SMEs) make sizeable contributions to the economic success of nations. Research concerning the internationalization of SMEs is available in the context of developed economies but less is can be found dealing specifically with the entrepreneurial behavior and international expansion of SMEs in emerging markets such as India. This research extends the literature addressing the relationships surrounding the internationalization of SMEs in India as related to entrepreneurial behavior, firm resources, and commitment to internationalization. Entrepreneurial orientation, a commitment to internationalization, and the ability to leverage human capital influence the international success of Indian SMEs, based on the analysis of data collected from 150 Indian SMEs.     

How Do SMEs with Single and Multiple Owners Finance Their Operations Differently? Empirical Evidence from China

We study the impact of firm‐level characteristics on the capital structures of private small and medium‐sized enterprises (SMEs) as well as the differences between the capital structures adopted by SMEs with single and multiple owners in China. Our findings highlight the limited use of asset‐based financing by Chinese SMEs. We also find that the propensity of SMEs with single‐owners to use external debt was significantly less than those with multiple owners. Furthermore, our findings suggest that single‐owned firms are subject to a more constrained pecking order than those with multiple owners. © 2013 Wiley Periodicals, Inc.     

SMEs, Social Capital and the Common Good

In this paper we report on empirical research which investigates social capital of Small and Medium Sized Enterprises (SMEs). Bringing an international perspective to the work, we make a comparison between 30 firms located in West London and Munich in the sectors of food manufacturing/production, marketing services and garages. Here we present 6 case studies, which we use to illustrate the early findings from this pilot project. We identify differences in approach to associational membership in Germany and the U.K., with a greater propensity to "belong" to an official group in Germany. We distinguish clear sectoral similarities across the countries, and indications that certain personality types will seek out engagement and find time beyond busy work life schedules, often merging work/home/leisure life and friends. Some of our cases illustrate that formal institutions, networks and mutual relationships can develop social capital for the SME, although we should take care not to assume a universal win-win situation for those who are engaged and contribute to the common good. Some of the obstacles to co-operation and civic engagement are outlined.