Structural Capital

Structural Capital

Structural Capital Jonathan Poland

Structural capital is one of the three primary components of intellectual capital, and consists of the supportive infrastructure, processes, and databases of the organization that enable human capital to function. Structural capital refers to the intangible assets and resources of an organization that support its operations and enable it to achieve its goals. It includes the systems, processes, policies, and culture that are in place within the organization, as well as the knowledge and expertise of its employees. Unlike human capital, which is the knowledge and skills of individual employees, structural capital is embedded within the organization and can be accessed and utilized by multiple individuals.

Structural capital is a key source of competitive advantage for an organization, as it helps to retain and utilize the knowledge and expertise of employees, enabling the organization to operate more efficiently and effectively. It also plays a role in the organization’s ability to innovate and adapt to change. While structural capital is often overlooked or undervalued compared to tangible assets, such as physical capital and financial capital, it is a crucial component of an organization’s intellectual capital. The following are illustrative examples of structural capital.

Data
Data such as a list of customers.

Documentation
Information created by employees to document processes, procedures, policy, know-how, research, decisions, failures and any other useful knowledge.

Media
Media such as a training video.

Principles
Principles, norms and rules that are adopted as part of a firm’s organizational culture.

Processes
Business processes such as a semi-automated process for fulfilling orders.

Procedures
Documented human steps for achieving a result.

Methods
Exact steps executed by a machine or system. For example, an algorithm for calculating risk.

Tools
Technologies that help employees complete work such as an application.

Automation
Technologies that complete work automatically such as a system or robot.

Intellectual Property
Intellectual property such as brands, trademarks, patents, copyrights and trade secrets.

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