Intellectual Capital and Organizational Performance in Saudi Public Universities

Abstract

Purpose this paper is to investigate the influence of four dimensions of intellectual capital (human, organizational, social and relational capital) on organizational performance. Design / methodology / approach Data were collected from 200 respondents of higher education institutions; the study used structural equation modeling to analyze the influence of human, organizational, social and relational capital on organizational performance. Findings Result suggests that organizational capital and social capital have significant and positive influence on organizational performance. Contrary to hypotheses, human capital has negative influence on organizational performance. Further, relational capital does not have significant influence on organizational performance. Practical implications Findings offer implications for higher education institutions mangers to utilize the knowledge that resides with in universities. It also enhances managerial ability to identify and apply these knowledge resources to improve organizational performance. Value/ originality improving organizational performance for higher education institutions is the main concern for higher education institution’s mangers , yet he influence of intellectual capital on organizational performance mostly remain as unexplained puzzle. This study contributes to knowledge literature by examining the missing link between different dimensions of knowledge and organizational performance. It also helps to understand the important intellectual capital’s dimensions that need to be capitalized and obtained to achieve higher performance specifically for higher education institutions.

Keywords: Intellectual Capital (IC), Organizational Performance (OP), Partial Least Squares (PLS), Higher Education Institution ( HEI )