What Are the Three Components of Intellectual Capital?
Intellectual capital is a term that refers to the intangible worth of your business. While you can easily determine other types of capital, intellectual capital is less rigid. There is no physical value – only a value that you define based on the three components of intellectual capital. Learn more about the various components and how you can determine your business’ intellectual worth.
1 Human Capital
Your business is what it is because of your employees. However, most valuations of businesses don’t include human capital. This is because assigning worth to your employees can be difficult. Human capital involves the ability, skill, and innovation of your employees. For example, you might have several employees who have certifications in certain techniques. Their education, as well as their talent, makes them worthy assets. All of their traits come into consideration when you’re determining human capital.
2 Structural Capital
Another facet of intellectual capital is structural capital. This term refers to your business culture, processes, or ability to be innovative. For instance, trade secrets protected intellectual property, and processes all are forms of structural value. Many times, your systems and processes are what make your business stand out from other competitors. It’s important to do what you can to protect your structural capital. Often, you can seek patents, trademarks, or copyrights to protect your intellectual property. If you want to keep your ideas in your own hands, you should speak to a patent attorney in Orlando. They can explain your options for keeping your structural capital safe.
3 Relational Capital
Your business relationships also have value, but this doesn’t only hold for relationships with investors. Relationships with your customers, partners, employees, communities, and stakeholders are all forms of relational capital. This type of capital often involves business contracts and other legally-binding contracts. However, it also could involve informal relationships.
Calculating Intellectual Capital
If you don’t have trademarks, patents, or copyright for your ideas, you could hurt your intellectual capital. You also make it more difficult to calculate your worth. For instance, a patent on an invention makes it your own. If you want to sell the invention, you can sell the actual patent. This transfers ownership of it. Usually, it’s easy to assign a patent or trademark with a value. But it’s more difficult to assign a value to an unprotected idea. For example, you might use a certain process to manufacture a product. If you don’t have any protection of that process, a competitor could develop and use the process at any time. This makes your process less valuable.
It’s quite challenging to put a value on certain components of intellectual capital. For example, many individuals have a hard time assigning a value to human capital. You might consider looking at the market value of other businesses. Doing so makes it easier for you to compare your workforce with that of a competitor.
Protecting Your Value
There are many other ways to determine the value of your intellectual capital. Competency models, business processing auditing, and other techniques can help. However, one fact remains true. If you don’t protect your capital, your company’s value drops. As a result, it’s essential to work with a patent lawyer in Orlando. The Patent Professor works with you to ensure that you’re protecting your business. Whether you need a patent, trademark, or copyright, they can help. You can make your intellectual capital more valuable than ever.