The impact of the intellectual capital on organizational performance: case study Private Schools in Setif & Batna

Abstract

With the advent of the era of knowledge economy, intellectual capital has become one of the important factors to improve the competitiveness and value of enterprises. In recent years, the research on intellectual capital and organizational performance has become a new hotspot in the field of management, and organizations are looking for these essential factors to ensure their survival and achieve constant development. This study presents a conceptually yet empirically supported framework to investigate the significance of the effects of three intellectual capital elements human, structural and relational capital on organizational performance in the private sector of SMEs. Results are based on empirical data collected through a structured questionnaire from 08 private schools and institutions in both Setif and Batna provinces in Algeria (n=59). We followed an Inferential approach and a quantitative analysis based on various statistical tools. The data were analysed using SPSS V26, where descriptive analysis depicts the data, correlation assesses the relationship between variables and multiple linear regression is used to conduct the analysis and measure the significance. The results from this investigation and the final estimated model indicate that the intellectual capital indeed, has a significant impact on the overall performance, structural capital positively and significantly impacts over organizational performance as the predictor that has the most impact. Similarly, relational capital significantly positively contributes to organizational performance. However, human capital has positive but insignificant relationship with the performance. The implication of our findings provides the managers useful insights into the importance of equipping their businesses with structural capital.