Would you agree that intellectual capital or knowledge is the primary resource of a firm/organization?

Expert Answers

An illustration of the letter 'A' in a speech bubbles

I would certainly agree that these things are a firm's primary resource.  This is particularly true for firms, such as law firms or architects, that do not create a tangible product.  However it is true even for firms that are producing tangible things like automobiles.

For a law firm, the importance of knowledge and intellectual capital is obvious.  Legal services consist of applying knowledge to a client's specific case.  However, intellectual capital is extremely important even for a manufacturer.  While it is true that a car maker needs steel and glass and other things, these are easier to come by than knowledge.  What is really rare and valuable is the knowledge of how best to engineer a car and how best to set up a supply chain and all sorts of other knowledge-based factors like these.

Physical raw materials can easily be bought.  Intellectual capital is rarer and more valuable.  Therefore, it is a firm's primary resource.

See eNotes Ad-Free

Start your 48-hour free trial to get access to more than 30,000 additional guides and more than 350,000 Homework Help questions answered by our experts.

Get 48 Hours Free Access
Approved by eNotes Editorial Team