Intellectual capital in the quoted Turkish ITC sector

• Published in: Journal of intellectual capital Vol. 11; no. 4; pp. 538 - 554
• Main Authors: Calisir, Fethi, Altin Gumussoy, Cigdem, Elvan Bayraktaro lu, A., Deniz, Ece
• Format: Journal Article
• Language: English
• Published: Bradford Emerald Group Publishing Limited 19.10.2010
• Subjects: Annual reports; Assessments; Banking industry; Benchmarks; Coefficients; Company performance; Computational efficiency; Computing time; Efficiency; Employees; Equity; Evaluation; Finance companies; Human capital; Information systems; Information technology; Intangible assets; Intellectual capital; Knowledge management; Literature reviews; Management theory; Markets; Mathematical models; Personnel management; Pharmaceutical industry; Productivity; R&D; Research & development; Research & development expenditures; Statistical analysis; Stock exchanges; Studies; Turkey; Valuation; Value added; Value creation; Turkey; Intellectual capital; Turkey; Company performance
• ISSN: 1469-1930; 1758-7468
• DOI: 10.1108/14691931011085678

Purpose - The purpose of this paper is to apply Value Added Intellectual Coefficient (VAIC™) of Pulic to compare quoted information technology and communication companies on the Istanbul Stock Exchange (ISE), in terms of intellectual capital efficiency. This study also examines VAIC™, and its components' impact on company performance.Design methodology approach - Multiple regression analysis was employed to identify the variables that significantly contribute to the company performance. Data required to calculate VAIC™ and its components were obtained from the 2005-2007 annual reports and balance sheets of the companies.Findings - As a whole, all the companies had a relatively higher human capital efficiency than structural and capital efficiencies. In 2007, Turkcell was the most efficient company based on VAIC™ assessment, while Link Bilgisayar and Plastikkart were the least efficient companies. Additionally, the results of the study revealed that factors such as human capital efficiency, firm leverage, and firm size, predicted profitability well. Among them, human capital efficiency had the highest impact. In addition, capital employed efficiency was found to be a significant predictor of both productivity and return on equity, and the only determinant of market valuation was the firm size.Practical implications - This study allowed ITC companies to benchmark themselves according to the intellectual capital efficiencies and develop strategies to enhance their company's performance.Originality value - This study is the first that measures intellectual capital performance and its impact on the company performance of the quoted information technology and communication companies on the ISE.