The Nordica Project: Measuring and Reporting Intellectual Capital Sigurður Helgason PwCIceland

The Nordica Project Started in 1999 by the Nordic Industrial Fund. The aim is to facilitate cooperation between Nordic companies in exchanging information about reporting on Intellectual Capital.

Whom is it for The organization Customers Investors Analysts

The Nordica Project 5 Icelandic companies participating Started in November 2000 First IC reports in the spring of 2001

If you can VISUALIZE it you can MEASURE it you can MANAGE it for continuous improvement and if you can measure it

“The wonderful thing about knowledge, is that it is relatively inexpensive to replicate if you can capture it. Most activities are not one time events. Our philosophy is fairly simple: Every time we do something again, we should do it better than the last time” John Browne BP

There are two types of knowledge: tacit and explicit Knowledge guides actions and informs decisions Skills, Craftsmanship Mental models, Patterns Beliefs, Values Experiences Know-how Procedures and policies Books, Databases, Texts Perceptions, Formulae, Equations, Rules Designs, Blueprints Insights, Tacitknowledge Best practice Products, Machines Personal Context-specific Difficult to formalize Difficult to communicate More difficult to transfer Packaged Easily codified Communicable Transferable Can be expressed in formal, shared language Documented information that can facilitate action Know-how and learning embedded within the minds of the people in the organization Explicitknowledge

Customer Capital Human Capital Organizational Capital

Customer Capital Human Capital Organizational Capital Human Capital Human Capital Employee competencies How does the company contribute to employee development Working procedures Organizational Capital Organizational Capital Quality standards Operating proceedures Information processes Customer Capital Customer Capital Image The way they do business Networks

Human Capital Human Capital Human Capital Employee competencies How does the company contribute to employee development Working procedures Employee competencies: Intellectual AssetWhat is the value How do we measure it Level of EducationThe ability to learn and share knowledge % with a university The ability to handle demanding projects degree How does the company contribute to employee development: Intellectual AssetWhat is the value How do we measure it TrainingIncreased knowledge and skills, % of employees receiving employee satisfaction, training, average # of recruitment benefits seminars per employee

Image: Intellectual Asset What is the value How do we measure it Image of products Makes it easier to marketSurvey customers/public Image of company LoyaltySurvey customers/public Customer Capital Customer Capital Customer Capital Image The way they do business Networks The way they do business: Intellectual Asset What is the value How do we measure it Honesty Loyalty, image Number of customers who find the company honest. Belief in the company Loyalty, image, reputation% of customers who because of their quality selected the company standards.because of their quality standards.

Organizational Capital Quality standards: Intellectual AssetWhat is the value How do we measure it Quality systemProfessional, uniform and # of quality standards organized procedures How often are they updated Organizational Capital Organizational Capital Quality standards Operating proceedures Information processess Information processess: Intellectual AssetWhat is the value How do we measure it Systematic trackingKnowledge sharing, access to Number of entries, % of re. customersinformation, marketing advantages employees actually using it

You don’t have to get it right the first time.

What stops us from sharing knowledge more than we do?

The challenge of each company is to facilitate knowledge sharing How did you solve that problem? How can we put that knowledge into our organizational structure? It is important to share knowledge with everyone, to make it available for all within the organization.

What are the main challenges to corporate success? 92% communications 88% sharing knowledge 78% team work 70% adapting to technology Source: Corporate Agility Conference October 1997

Jan Carlsson, CEO SAS ”An individual without information cannot take responsibility; an individual who is given information cannot help but take responsibility” Jan Carlsson, CEO SAS Alison Tucker, Buckman Laboratories ”Communication is human nature; Knowledge sharing is human nurture” Alison Tucker, Buckman Laboratories

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