Background: Literature has recognized the critical role of knowledge and thus, intellectual capital (IC) to enhance strategy (Eisenhardt and Santos, 2002; Marr and Ross, 2005; Sveiby, 2001) and to prepare a dynamic competitive environment (Grant, 1996). The accounting studies on intellectual capital (IC) have been providing evidences of the role of IC based accounting techniques to improve management and reporting (Guthrie et al., 2012; Mouritsen et al., 2001). Nevertheless, scholars call to analyze how IC contributes to increase the organization’ s value, considering the relations between IC factors and business strategy (Roos, 2005). The agricultural sector results to be an increasing challenging environment (Boehlje et al., 2011), characterized by deep innovation processes steaming from the critical role of know-how and knowledge (Soulignac et al., 2012). Thus, knowledge management tools have been experimented (such as the Knowledge for Organic Farming and its Innovation System - KOFIS); however, when considering intellectual capital literature, intellectual capital accounting in agricultural sector results to be an under-researched field (Kozera, 2011), and more in general, only few studies at present analyze IC’s effect on performance of firms in farm business (see for e.g. Scafarto et al., 2016; Lee and Shaiban, 2014). Purpose: The paper aims at shading light on the role and relationship between human, structural and relational capital for strategic management in the chosen farm business. In particular, it aims at analyzing the interaction between human capital (the farm operators) and the introduction of innovative and sustainability-oriented agricultural technologies that follows management’ strategic orientation for firm’s competitiveness. Methodology: An explorative case study analysis (Yin, 2013) was conducted in the largest Italian agricultural firm to get an understanding of the intellectual capital’s variables and of their implication for strategic management. Data were gathered through interviews with top and middle management of the firm that help drawing the strategical map of the organization. Moreover, full time employees’ perception of the skills and knowledge required to achieve the fixed goals and their perception to possess these abilities were investigated through a closed answer questionnaire; therefore, their perceptions on the relevance of training to develop these critical skills were investigated. The skills were subsequently classified using the framework of Amabile in domain-relevant and creativity-relevant skills (1988); correlation’ analysis through Spearman’s rho (Sheskin, 2011) between the two sets of skills was calculated to create additive indexes, and linear regression models were set to investigate the effects of training on the acquisition of domain-relevant and creativity-relevant skills. Findings: The analysis confirmed the role of continuous training to build employees’ creativity’ skills to the innovation based strategy of the farm. Strengthen human capital through training to acquire new technical knowledge and make this knowledge exchangeable and transferable among employees, significantly impacts on the acquisition of innovative capacity, especially problem-solving which is applied exploiting new knowledge domains (Subramaniam and Youndt, 2005). The interviewed employees perceived a substantial alignment between their abilities and the capabilities considered relevant to support the introduction of innovative technology as a strategical priority of the company. However, a gap emerged when considering informatics capabilities and knowledge of soils. As company’s investment in innovation concerned the introduction of machines (the combines) using ICT technology to optimize agricultural planning on the base of a major knowledge of soils’ properties, the organization might eventually strengthen informatics’ training in order to enable its employees to effectively use innovation. Conclusions: As human capital has been considered a critical success factor for farm’s management, some formal approaches to manage human capital variables have emerged in literature (Soulignac et al., 2012). The paper contributes to the literature on intellectual capital highlighting the role of interconnections of human, structural and relational capital to align the organization to the strategic goals. The key role of knowledge, capabilities and competences embedded in the employees, to adopt technological innovations and implement organizational change has been highlighted, as well as the role of relational capital in rendering structural and human capital effective. Therefore, IC accounting discipline could contribute to define an explicit approach to the management of human capital for strategic purposes.

Intellectual Capital and Strategic management in Farm businesses: a case study

VAGNONI, Emidia;CAVICCHI, Caterina
2017

Abstract

Background: Literature has recognized the critical role of knowledge and thus, intellectual capital (IC) to enhance strategy (Eisenhardt and Santos, 2002; Marr and Ross, 2005; Sveiby, 2001) and to prepare a dynamic competitive environment (Grant, 1996). The accounting studies on intellectual capital (IC) have been providing evidences of the role of IC based accounting techniques to improve management and reporting (Guthrie et al., 2012; Mouritsen et al., 2001). Nevertheless, scholars call to analyze how IC contributes to increase the organization’ s value, considering the relations between IC factors and business strategy (Roos, 2005). The agricultural sector results to be an increasing challenging environment (Boehlje et al., 2011), characterized by deep innovation processes steaming from the critical role of know-how and knowledge (Soulignac et al., 2012). Thus, knowledge management tools have been experimented (such as the Knowledge for Organic Farming and its Innovation System - KOFIS); however, when considering intellectual capital literature, intellectual capital accounting in agricultural sector results to be an under-researched field (Kozera, 2011), and more in general, only few studies at present analyze IC’s effect on performance of firms in farm business (see for e.g. Scafarto et al., 2016; Lee and Shaiban, 2014). Purpose: The paper aims at shading light on the role and relationship between human, structural and relational capital for strategic management in the chosen farm business. In particular, it aims at analyzing the interaction between human capital (the farm operators) and the introduction of innovative and sustainability-oriented agricultural technologies that follows management’ strategic orientation for firm’s competitiveness. Methodology: An explorative case study analysis (Yin, 2013) was conducted in the largest Italian agricultural firm to get an understanding of the intellectual capital’s variables and of their implication for strategic management. Data were gathered through interviews with top and middle management of the firm that help drawing the strategical map of the organization. Moreover, full time employees’ perception of the skills and knowledge required to achieve the fixed goals and their perception to possess these abilities were investigated through a closed answer questionnaire; therefore, their perceptions on the relevance of training to develop these critical skills were investigated. The skills were subsequently classified using the framework of Amabile in domain-relevant and creativity-relevant skills (1988); correlation’ analysis through Spearman’s rho (Sheskin, 2011) between the two sets of skills was calculated to create additive indexes, and linear regression models were set to investigate the effects of training on the acquisition of domain-relevant and creativity-relevant skills. Findings: The analysis confirmed the role of continuous training to build employees’ creativity’ skills to the innovation based strategy of the farm. Strengthen human capital through training to acquire new technical knowledge and make this knowledge exchangeable and transferable among employees, significantly impacts on the acquisition of innovative capacity, especially problem-solving which is applied exploiting new knowledge domains (Subramaniam and Youndt, 2005). The interviewed employees perceived a substantial alignment between their abilities and the capabilities considered relevant to support the introduction of innovative technology as a strategical priority of the company. However, a gap emerged when considering informatics capabilities and knowledge of soils. As company’s investment in innovation concerned the introduction of machines (the combines) using ICT technology to optimize agricultural planning on the base of a major knowledge of soils’ properties, the organization might eventually strengthen informatics’ training in order to enable its employees to effectively use innovation. Conclusions: As human capital has been considered a critical success factor for farm’s management, some formal approaches to manage human capital variables have emerged in literature (Soulignac et al., 2012). The paper contributes to the literature on intellectual capital highlighting the role of interconnections of human, structural and relational capital to align the organization to the strategic goals. The key role of knowledge, capabilities and competences embedded in the employees, to adopt technological innovations and implement organizational change has been highlighted, as well as the role of relational capital in rendering structural and human capital effective. Therefore, IC accounting discipline could contribute to define an explicit approach to the management of human capital for strategic purposes.
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11392/2374170
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