7 years, 5 months ago

Measure Structural Capital to show EA value

Link: http://lundbergdaniel.wordpress.com/2012/01/29/measure-structural-capital-to-show-ea-value/

What is the total value of your organization’s assets? The accountants keep track on all physical assets and the financial assets, but the field of measuring intangible assets is still emerging. Intangible assets are all the resources within the organization that does not appear on the balance sheet. This counts for as much as 80% of many businesses today!

Intangible assets are divided into human capital, relational capital and structural capital.

Human Capital

The knowledge that all employees of the business holds. When the employees leave, the value of the human capital leaves.

Structural Capital

The knowledge that stays in the organization when all employees leave at the end of the day. This includes processes, databases and software, but also work products from the enterprise architects.

Relational Capital

This consists of all value that the business get from their customer and partner relations. External networks is increasingly important for the businesses today which shows on the value of the relationship capital.

It is easy to get other architects to understand the value of structural capital, but we should also be active in getting our organizations to measure that value. I think that one of the reasons why EA is so difficult to put numbers on is that structural capital doesn’t get measured in the organizations.

I feel that combining enterprise architecture with research about intangible capital might be an interesting way to find the right focus areas for EA investments!

Are you aware of any organizations where they focus not only on developing their EA structural capital but also measure it?

References

Below are some of the books and other material I have read in order to learn about the area of intangible capital. I like the term “intangible capital” better than “intellectual capital”, but both are used in the litteratue. You can also refer to IC knowledge center as a community for people interested in this area.

  1. Mary Adams & Michael Oleksak (2010) “Intangible Capital: Putting Knowledge to Work in the 21st-Century Organization”
  2. Leif Edvinsson (2002) “Corporate Longitude: What you need to know to navigate the knowledge economy”
  3. InCaS – Intellectual Capital Statement http://www.incas-europe.eu/
  4. Kenan Patrick Jarboe (2007) “Measuring Intangibles” http://www.athenaalliance.org/apapers/MeasuringIntangibles.htm
  5. Intellectual Capital on Wikipedia http://en.wikipedia.org/wiki/Intellectual_capital