(1913.pdf) THE EFFICIENCY OF INTELLECTUAL CAPITAL IN CREATING VALUE TO COMPANY PERFORMANCE AMONG MALAYSIAN TECHNOLOGY COMPANIES

摘要

In today's knowledge-based economy and innovation age, intellectual capital (IC) plays a vital role inachieving firm competitive advantage. IC can be defined as intangible assets comprising technology,brand name, corporate culture, customer information, etc. IC is divided into human capital, structuralcapital, relational capital, and spiritual capital. This study was conducted to investigate the ICefficiency in creating value among technology companies in Malaysia. The objectives of the studywere to measure the IC efficiency among the companies, to identify the most efficient IC elements,and to examine the relationship between IC efficiency and company performance. Data from annualreports of 29 technology companies listed in the Main Board of Bursa Malaysia (Malaysian Bourse)were analyzed using VAICTM to measure IC efficiency while the company performance wasmeasured by using return on assets ratio (ROA). Pearson's Correlation was employed to examine therelationship between the companies' IC efficiency and their performance. For the purpose of applyingVAICTM, spiritual capital was not included. The findings indicate that the most efficient IC elementamong the Malaysian technology companies is human capital, in average the companies generateRM2.17 return on each RM1 invested, and there is a positive and significant relationship between theirIC efficiency and their performance. Based on the findings, it is concluded that IC efficiency is creatingvalue for the companies and it is recommended that the companies manage their IC effectively toincrease their performance.