The Intellectual Capital Performance of KuwaitiBanks: An Application of vaicTM1 Model
Fayez Abdulsalam, Hameed Al-Qaheri, Ridha Al-Khayyat
.
DOI: 10.4236/ib.2011.31014   PDF         7,219 Downloads   15,640 Views   Citations

Abstract

The paper uses the Value Added Intellectual Coefficient VAICTM model, a widely used model, to measure the Intellectual Capital efficiency of the Kuwaiti Banks using a ten years period data set from 1996 to 2006. Three value efficiency indicators, Human Capital Efficiency (HCE), Capital Employed Efficiency (CEE) and VAICTM, where used in the analysis. The data set was divided into commercial and no-commercial banks. The non commercial banks were outperformed by almost all the commercial banks in the last 3 years; 2004-2006. The results of the rankings of the banks for the last year (2006) showed that for VAICTM the top two performers in the study were The Commercial Bank of Kuwait followed by the Gulf bank while the worst performer was Kuwait Real Estate Bank. And the results of ranking based on Human Capital Efficiency (HCE), showed similar results as that of VAICTM. However, the ranking results based on Capital Employed Efficiency (CEE) showed the top two performers to be National Bank of Kuwait followed by the Gulf Bank and the worst performer was still the Kuwait Real Estate Bank

Share and Cite:

F. Abdulsalam, H. Al-Qaheri and R. Al-Khayyat, "The Intellectual Capital Performance of KuwaitiBanks: An Application of vaicTM1 Model," iBusiness, Vol. 3 No. 1, 2011, pp. 88-96. doi: 10.4236/ib.2011.31014.

Conflicts of Interest

The authors declare no conflicts of interest.

References

[1] “Intellectual Capital Efficiency on National and Company Level,” International Business Efficiency Consultancy, 2003. Available at www.vaic-on.net
[2] M. A. M. Makki and S. A. Lodhi, “Impact of Intellectual Capital on Return on Investment in Pakistani corporate Sector,” Australian Journal of Basic and Applied Sciences, Vol. 3, No. 3, 2009, pp. 2995-3007.
[3] J. Barney, “Firm Resource and Sustainable Competitive Advantage,” Journal of Management, Vol. 17, No. 1, 1991, pp. 99-120. doi:10.1177/014920639101700108
[4] A. Pulic, “Mva and Vaic Analysis of Randomly Selected Companies from Ftse 250,” 2000, Available at www.vaic-on.net/start.htm (accessed 29 March 2006), pp. 1-44.
[5] A. Pulic, “Vaic: An Accounting Tool for Ic Management,” International Journal of Technology Management, Vol. 20, No. 5-8, 2000, pp. 702-714. doi:10.1504/IJTM.2000.002891
[6] A. Pulic, “Do We Know if We Create or Destroy Value?” 2002. Available at www.vaic-on.net/start.htm
[7] A. Pulic, “National Ic-Efficiency Report of Croatian Economy,” 2002. Available at www.vaic-on.net/start.htm, pp. 1-14
[8] A. Pulic, “Value Creation Efficiency Analysis of Croatian Banks, 1996-2000,” 2002. Available at www. vaic-on.net /start.htm
[9] “Intellectual Capital Efficiency in Croatian Counties,” International Business Efficiency Consultancy, 2002, Available at www.vaic-on.net.
[10] D. G. Mavridis, “The Intellectual Capital Performance of the Japanese Banking Sector,” Journal of Intellectual Capital, Vol. 5, No. 1, 2004, pp. 92-115. doi:10.1108/14691930410512941
[11] Yalama, A. and Coskun, M. “Intellectua Capital Performance of Quoted Banks on the Istanbul Stock Exchange Market,” Journal of Intellectual Capital, Vol. 8, No. 2, 2007, pp. 256-271. doi:10.1108/14691930710742835
[12] P. C. Goh, “Intellectual Capital Performance of Commercial Banks in Malaysia,” Journal of Intellectual Capital, Vol. 6, No. 3, 2005, pp. 385-396. doi:10.1108/14691930510611120
[13] N. M. N. Muhammad and K. K. Bharu, “Intellectual Capital Efficiency and Firm’s Performance: Study on Malaysian Financial Sectors,” International Journal of Economics and Finance, Vol. 1, No 2, 2009, pp. 206-219.
[14] G. B. Kamath, “The Intellectual Capital Performance of the Indian Banking Sector,” Journal of Intellectual Capital, Vol. 8, No. 1, 2007, pp. 96-123. doi:10.1108/14691930710715088
[15] D. G. Mavridis and P. Kyrmizoglou, “Intellectual Capital Performance Drivers in the Greek Banking Sector”, Management Research News, Vol. 28, No. 5, 2005, pp. 43-62. doi:10.1108/01409170510629032
[16] B. R. Appuhami, “The Impact of Intellectual Capital on Investors’ Capital Gain on Shares: An Empirical Investigation in Thai Banking, Finance & Insurance Sector,” Journal of Internet Banking and Commerce, Vol. 12, No. 1, 2007, pp. 1-14.
[17] P. Kujansivu and A. Lonnqvist, “The Value and Efficiency of Intellectual Capital in Finish Companies,” 2005. Available at www.tut.fi/units/tuta/tita/tip/KujansivuLonn qvist.pdf
[18] P. Kujansivu and A. Lonnqvist, “Investigating the Value and Efficiency of Intellectual Capital,” Journal of Intellectual Capital, Vol. 8, No. 2, 2007, pp. 272-287. doi:10.1108/14691930710742844
[19] K. H. Chan, “Impact of Intellectual Capital on Organisational Performance: An Empirical Study of Companies in the Hang Seng Index (Part 1),” The Learning Organization, Vol. 16, No. 1, 2009, pp. 4-21. doi:10.1108/09696470910927641
[20] K. H. Chan, “Impact of Intellectual Capital on Organisational Performance: An Empirical Study of Companies in the Hang Seng Index (Part 2),” The Learning Organization, Vol. 16, No. 1, 2009, pp. 22-39. doi:10.1108/09696470910927650
[21] J. Zhang, N. Zhu and Y. Kong, “Study on Intellectual Capital and Enterprise’s Performance: Empirical Evidence from the Chinese Securities Market,” Journal of Modern Accounting and Auditing, Vol. 2, No. 10, 2006, pp. 35-39.
[22] M. C. Chen and S. J. Cheng, “An Empirical Investigation of the Relationship between Intellectual Capital and Firms Market Value and Financial Performance,” Journal of Intellectual Capital, Vol. 6, No. 2, 2005, pp. 159-176. doi:10.1108/14691930510592771
[23] A. Pulic, “Intellectual Capital: Does it Create or Destroy Value?” Measuring Business Excellence, Vol. 8, No. 1, 2004, pp. 62-68. doi:10.1108/13683040410524757
[24] VAIC, “VAIC Methodology-Key Development Stages,” Available at www.vaicon.net/download/VAIChistory.doc
[25] J. A. Nazari and I. M. Herremans, “Extended Vaic Mode: Measuring Intellectual Capital Components,” Journal of Intellectual Capital, Vol. 8, No. 4, 2007, pp. 595-609. doi:10.1108/14691930710830774
[26] R. Petty and J. Guthrie, “Intellectual Capital Literature Review: Measurement, Reporting and Management,” Journal of Intellectual Capital, Vol. 1, No. 2, 2000, pp. 155-76. doi:10.1108/14691930010348731
[27] G. Roos, A. Bainbridge and K. Jacobsen, “Intellectual Capital as a Strategic Tool,” Strategy and Leadership Journal, Vol. 29, No. 4, 2001, pp. 21-26. doi:10.1108/10878570110400116
[28] N. Bontis, “Assessing Knowledge Assets: A Review of the Models Used to Measure Intellectual Capital,” International Journal of Management Reviews, Vol. 3, No. 1, 2001, pp. 41-60. doi:10.1111/1468-2370.00053
[29] N. Bontis, “Intellectual Capital Disclosure in Canadian Corporations,” Journal of Human Resource Costing and Accounting, Vol. 7, No.1/2, 2003, pp. 9-20. doi:10.1108/eb029076
[30] N. Bontis, “Canada’s Innovation Performance: A Preliminary Benchmarking with the OECD,” Working Paper Presented at McMaster World Congress, 2004.
[31] N. Bontis, “National Intellectual Capital Index: a United Nations Initiative for the Arab Region,” Journal of Intellectual Capital, Vol. 5, No. 1, 2004, pp. 13-39. doi:10.1108/14691930410512905
[32] P. Stiles and S. Kulvisaechana, “Intellectual Capital and Performance: A Literature Review,” 2002, Available at www.berr.gov.uk/files/file38844.pdf, pp. 1-39.
[33] G. Schiuma, and A. Lerro, “Intellectual Capital and Company’S Performance Improvement,” Measuring Business Excellence, Vol. 12, No. 2, 2008, pp. 3-9. doi:10.1108/13683040810881153
[34] S. Firer and S. M. Williams, “Intellectual Capital and Traditional Measures of Corporate Performance,” Journal of Intellectual Capital, Vol. 4, No. 3, 2003, pp. 348-360. doi:10.1108/14691930310487806
[35] S. Williams, “Is Intellectual Capital Performance and Disclosure Practices Related?” Journal of Intellectual Capital, Vol. 2, No. 3, 2001, pp. 192-203. doi:10.1108/14691930110399932
[36] I. Kubo and A. Saka, “An Inquiry into the Motivations of Knowledge Workers in the Japanese Financial Industry,” Journal of Knowledge Management, Vol. 6, No. 3, 2002, pp. 262-271. doi:10.1108/13673270210434368
[37] Croatian Chamber of Commerce, “Intellectual Capital Efficiency in Croatian Counties. Case Study, Zagreb,” 2002. Available at www.vaic-on.net

Copyright © 2024 by authors and Scientific Research Publishing Inc.

Creative Commons License

This work and the related PDF file are licensed under a Creative Commons Attribution 4.0 International License.