Improving internal consistency in IC research and practice: IC and the theory of the firm
Abstract
Purpose
The purpose of this paper is to demonstrate the usefulness of referring to a theory of the firm as a way to strongly improve internal consistency in both research and practice. To this end, the paper explores how a theory-of-the-firm perspective can assist in a consistent analysis of IC, focusing on five IC-related issues: the definition and the origins of IC; the set of property rights on IC; its role in the competitive advantage and the value generation process of the firm; the way IC can be valued, including issues relating to the internal and external reporting; and finally the most efficient way to effectively manage and control IC. Analysis is carried out referring to the strengths and weaknesses of the resource-based view (RBV), being the main reference theories for IC scholars and practitioners.
Design/methodology/approach
The paper employs a deductive approach to explore how different theories of the firm shape the way IC-related issues could be consistently analysed.
Findings
The research finds that referring to a theory of the firm assists investigating IC-related issues. It carries out the analysis of five important issues under the two forms of the RBV, demonstrating how a different theory of the firm differentiates analysis and offers room for improving the internal consistency for both research and practice.
Research limitations/implications
Implications of the paper are mainly for improving consistency in research, but they also support practice as for consciousness and awareness. Limitations are as follows. First, the paper offers an analysis of only two selected theories of the firm. Second, the analysis is based on a deductive reasoning which can be criticised for the results, even if not for the aim.
Practical implications
The paper offer stimuli to both theoretical and empirical research and practice. As for research, the paper highlights how consistency can be developed and also focusses on the way empirical research could be consistently carried out. As for practitioners, the paper assists in enlightening covered links between practice and theories.
Originality/value
The paper pays attention to the role of the theory of the firm, as a way for improving internal consistency in the study and the practice of IC.
Keywords
Acknowledgements
Some of the ideas of this paper have been presented at The 6th Interdisciplinary Workshop on Intangibles, Intellectual Capital & Extra-Financial Information, Catania, Italy, 30 September-1 October 2010; at The 34th Annual Congress of the European Accounting Association, Rome, Italy, 20-22 April 2011; at The Roma III University Workshop on Intangibles, Rome, Italy, 12 April 2011; at the “Innovation in Network Industries: Accounting, economic and regulatory implications” Seminar, Paris, France, 16 March 2011; and at The SASE 23rd Annual Conference, Madrid, 23-25 June 2011. The author thanks all participants of the meetings for their helpful insights. He also thanks two anonymous reviewers and the editor of this Journal for their helpful comments on previous drafts of the paper. Finally, he thanks Brenda Ogilvie for checking language and style, so improving the readability of the paper. As usual all remaining errors and obscurities are the author's own responsibility.
Citation
Marzo, G. (2014), "Improving internal consistency in IC research and practice: IC and the theory of the firm", Journal of Intellectual Capital, Vol. 15 No. 1, pp. 38-64. https://doi.org/10.1108/JIC-03-2013-0026
Publisher
:Emerald Group Publishing Limited
Copyright © 2014, Emerald Group Publishing Limited