M. Rashid Khan
Saudi Aramco, Leader Corporate Intellectual Assets Management, Dharan, Saudi Aramco, Saudi Arabia
Paul Germeraad
Intellectual Assets, Inc., President, Saratoga, CA, USA
In response to the changing needs of the company and the region, intellectual capital (IC) awareness undertaking was introduced as a new initiative in Saudi Aramco. The company is the world’s largest producer and exporter of crude oil, a world-scale producer of natural gas, and a growing player in refining.
Recently, Saudi Aramco added petrochemicals through in-Kingdom and overseas integrated refining and petrochemical joint ventures. Like many major companies, Saudi Aramco has a vast wealth of unrecognized and untapped IC at its disposal. The IC “capital” components are human, relational, and structural capitals and their interactions to add value. To fully recognize the value of IC components, a company needs to: (a) identify the assets, and then (b) transform IC into value-adding solutions to meet the challenges facing the company today and the ones we are likely to face in the future.
This paper examines the classifications and models that emerged to define, recognize, and measure IC. Some related case studies are also compared. Most studies of intellectual capital focus at the organizational level, with an emphasis on explaining the role of “intangible assets” as a differentiator between accounting value and market value as a possible source of competitive advantage. These methods can be used to a broader scope, with the objective of comparing the IC indices perhaps at the national level. However, the value of intangible assets and how to quantify or benchmark it is still too vague for decision making. This article presents major types of intellectual growth patterns and identifies the impact of major types of intellectual capital growth patterns for innovation, business creation, competitiveness, growth, and development. The ultimate goal is to develop and deploy appropriate IC initiatives to capture their full value for a company such as Saudi Aramco with an ultimate to goal to transform the Kingdom.
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