The role of intellectual capital in achieving competitive advantage (A case study of Omdurman National Bank 2010-2015)

Prepared by the researcher :  Prof. Al-Bashir Al-Tijani Muhammad-Bakht El-Ruda University – White Nile Private University.

Democratic Arab Center

Journal of Afro-Asian Studies : Sixteenth Issue – February 2023

A Periodical International Journal published by the “Democratic Arab Center” Germany – Berlin.

https://democraticac.de/wp-content/uploads/2023/02/Journal-of-Afro-Asian-Studies-Sixteenth-Issue-%E2%80%93-February-2023.pdf

Abstract

 The aim of the research is to know the role of intellectual capital in achieving the competitive advantage in Omdurman National Bank.

The researcher used the descriptive and analytical approaches and chose a soft sample of (25%) of the research community, which consists of (250) individuals. He also used the (SPSS) program to analyze the questionnaire data. The researcher reached several results, the most Important of which is the validity of the research hypothesis and the bank’s endeavor to achieve better competitiveness.

Research problem:

The researcher noticed the organizations’ lack of interest in building intellectual capital, as it is in Omdurman National Bank, where the capacity of Omdurman National Bank is established, where the capabilities and skills of individuals are recognized and exploited optimally, to achieve building a competitive advantage. Accordingly, the research problem can be formulated in the following main question:

 What is the role of intellectual capital management in achieving the competitive advantage in Omdurman National Bank? The following questions arise from it:

– Is there interest in intellectual capital to achieve a competitive advantage in Omdurman National Bank?

– What is the extent of the impact of intellectual capital on the competitive advantage of Omdurman National Bank?

– Does measuring and evaluating the bank’s intellectual capital affect achieving competitive advantage?

research hypotheses:

The study hypotheses based on the research problem and its elements as follows:

– Is there a statistically significant relationship between intellectual capital and competitive advantage in Omdurman National Bank? The hypotheses branched out of it:

– There is a statistically significant relationship between providing intellectual capital requirements and achieving competitive advantage in Omdurman National Bank?

– There is a statistically significant relationship between the preservation of intellectual capital and the competitive advantage in Omdurman National Bank?

– Is there a statistically significant relationship between the assessment of intellectual capital and the competitive advantage in Omdurman National Bank?

Research Methodology:

The research followed the descriptive and case study approaches, and the statistical social survey program (SPSS) was used for data analysis.

 Previous studies:

– A study (Habaina, 2007) titled (The Role of Intellectual Capital in Enhancing the Competitive Advantage of the Enterprise) (1) reached a number of results, the great importance of intellectual capital in achieving the competitive advantage of the organization by investing mental capabilities and working to enhance and manage them effectively to achieve intellectual performance that leads to competitive superiority.

– (Mazlan study, 2005) entitled (Evaluation of Intellectual Capital on Performance for Malaysia Telecom Company)(2)

. The results of the statistical analysis confirmed the presence of positive relationship between intellectual capital and company performance.

The concept of intellectual capital:

Some researchers classified that intellectual capital consists of the following: (3)

– Human assets: (human capital):

It is the knowledge that is preserved in the mind of the individual worker and is not owned by the organization, but rather is linked to the individual personally, and is represented in skills, creativity and experience.

– Intellectual assets:

It is the knowledge that is independent of the working person and is owned by the organization, or it is the set of tools and techniques of the well-known work group that are used to contribute to the sharing of information and knowledge in the organization. Examples of intellectual assets are plans, engineering designs and computer programs.

Structural capital:

It includes the structural ability to move and develop initiatives, by taking into account new expectations and recognition of new ideas, concepts and tools that adapt to change, including culture, organizational models, processes and procedures.

– Intellectual property: (renewal capital):

It includes the elements that allow the organization to renew and what can be legally protected, such as patents, trademarks, investment rights, talent for publishing and conferences, and industry organizations seek to own more intellectual property to achieve a competitive advantage that enables them to face the severity of Market competition.

Relationship capital:

It reflects the nature of the relationships that link the organization with stakeholders and its competitors and provides an important added value due to the distinctive transactions that link the organization with the external environment.

Intellectual capital as an input to achieve competitive advantage:

This is done through the following: (4)

– Determinants of the development of competitive advantages for business organizations in the knowledge economy, and there is no doubt that competition to acquire the largest sector of the market has become the dominant feature in the twenty-first century, and the search for competitive advantages is the biggest challenge for management in light of globalization and contemporary developments in information technology, and until the organization achieves excellence in a way It is allowed to enter the target market and achieve excellence and continuity. The matter depends on several elements, including:

– The organization’s control over the cost component. The availability of research and development capabilities

– The extent to which the organization absorbs the increasing technological developments. – The extent to which the organization has access to sources of information about the market, customers and competitors. Above all, the organization has human resources with distinct creative and innovative capabilities.

Definition of competitive advantage:

 Competitive advantage is defined as: the skill, technology, or distinguished resource that allows the organization to produce values ​​and benefits for customers that exceed what competitors offer, and confirms its distinction and difference from them from the point of view of customers who accept this difference and distinction, as it achieves more benefits and values ​​that outweigh their competitors. What Others Provide (5)

Dimensions of competitive advantage:

The competitive advantage has dimensions represented in:(6)

cost:

The lowest cost is the main goal of companies that compete through cost, and even those that compete through competitive advantages other than cost, as they seek to achieve low costs for the products they produce.

Quality dimension:

Quality is an important competitive advantage and to provide products that meet the needs of customers. Customers want quality products that meet the characteristics required by them, which are the characteristics they expect or see in advertising. Companies that do not provide quality products that meet the needs, desires, and expectations of customers cannot survive and succeed in competition.

 flexibility:

Flexibility is the basis for achieving the competitive advantage of the company through rapid response to changes that may occur in product design and to suit the needs of customers, and it means the ability of the company to change operations to other methods, and this may mean changing the performance of operations as well as changing the method and time of performing operations, the customer needs To change operations to provide four requirements: – (product flexibility: which is the ability of operations to provide new or modified products, mix flexibility: which means the ability of operations to produce a mix of products, and size flexibility: which means the ability of operations to change the level of output or the level of production activity To offer different sizes of products. Delivery flexibility: Refers to the ability of operations to change product delivery times.

delivery:

The delivery dimension is the basic basis for competition between companies in the markets by focusing on reducing lead times and speed in designing new products and presenting them to customers in the shortest possible time. There are three priorities for the delivery dimension dealing with time: speed of delivery, delivery on time, speed of development.

 creativity:

Some writers and researchers add creativity as a dimension of competitive advantage. The opinions of writers and researchers have varied regarding creativity. There are many definitions of creativity. (Mead) defined it as: the process or activity that an individual performs and results in a product or something. new.

Research procedures:

In order to obtain the primary information and data for this research, the researcher designed a questionnaire whose validity and stability were confirmed. It included (22) phrases distributed on intellectual capital with (5) phrases, and (4) phrases for each of the requirements of intellectual capital, and the preservation of capital. Intellectual money, intellectual capital evaluation, and competitive advantage.

Research population and sample:(53)

questionnaires were distributed to a soft sample of employees, administrators, and other job occupants at Omdurman National Bank out of a total of (250) employees at Omdurman National Bank.

 Use the test (as any squared) to test the statistical significance of research hypotheses at a significant level of 5%, which means that if the value of a squared calculated at a significant level is less than 5%, the null hypothesis is rejected and the alternative hypothesis (the research hypothesis) is correct.

Research data analysis:

Table 1: Kai-square test for the expressions of the intellectual capital axes

From Table (1), the value of k-square calculated to denote the differences between the members of the study sample for all expressions as follows:

– The interest in the intellectual capital (569.14) at degrees of freedom (4) and the level of significance (0.006) is less than 5% on it. This indicates that there is a statistically significant difference between the answers of the sample members and in favor of those who agree.

– Intellectual capital requirements (17.949) at degrees of freedom (3) and the level of significance (0.000) is less than 5%. Therefore, this indicates that there are statistically significant differences between the answers of the sample members, and in favor of those who agree.

– Maintaining the intellectual capital (28.884) at degrees of freedom (4) and the level of significance (0.000) is less than 5%. Therefore, this indicates that there are statistically significant differences between the answers of the sample members, and in favor of those who agree.

– Evaluation of intellectual capital (21,544) at degrees of freedom (3) and the level of significance (0.000) is less than 5%. Therefore, this indicates that there are statistically significant differences between the answers of the sample members, and in favor of those who agree.

 – The competitive advantage (5.602) at degrees of freedom (3) and the level of significance (0.000) is less than 5%. Therefore, this indicates that there are statistically significant differences between the answers of the sample members, and in favor of those who agree.

Testing the validity of the research hypotheses:

  This is a discussion and interpretation of the field data results, through the information generated by the statistical data analysis tables, as well as the results of the statistical analysis to test the hypotheses, which is the result of a simple linear regression analysis of the research hypotheses relationships.

Table (2) Simple linear regression analysis of the research hypotheses relationships

From table (2), we find that the results of hypothesis (1) there is ass correlation (above the mean) between intellectual capital and competitive advantage, through the value of the correlation coefficient (R) and its value is 0.61, which is an absolute value that does not determine the form of the relationship between the dependent and independent variable and by reference to the value of Regression coefficient (B) 0.56, which indicates the existence of a direct relationship between intellectual capital and competitive advantage. The value of the determination coefficient (explanatory powers) is 37% of the changes in the dependent variable (competitive advantage) caused by the future variable (intellectual capital), as evidenced by the results of the analysis There is a statistically significant relationship between the dependent variable (competitive advantage) and the independent variable (intellectual capital) according to the “t-test” at a significant level (5%), where the calculated (t) value was (5.43), with a level of significant significance.

At the level of significant significance (0.000). It is a value less than the 5% significance level. Accordingly, the hypothesis is accepted, which indicates the existence of a statistically significant relationship between intellectual capital and competitive advantage at Omdurman National Bank, which is a positive relationship.

From the results of hypothesis (2), there is a correlation (above the mean) between intellectual capital requirements and competitive advantage, through the value of the correlation coefficient (R) = 0.54, which is an absolute value that does not determine the shape of the relationship between the dependent and independent variable and by referring to the value of the regression coefficient (B) = 0.53 This indicates that there is a direct relationship between capital requirements and competitive advantage in Omdurman National Bank.

The value of the coefficient of determination (explanatory powers) is 29%.Among the changes in the dependent variable (competitive advantage) caused by the future variable (intellectual capital requirements), and as evidenced by the results of the analysis, there is a statistically significant relationship between the dependent variable (competitive advantage) and the independent variable (intellectual capital requirements) according to the “t-test”. At the level of significance (5%), where the calculated value of (t) was (4.57), at the level of significance (0.000), which is a value less than the level of significance 5%.Therefore, the hypothesis is accepted, which indicates the existence of a statistically significant relationship between the extent to which requirements are provided. Intellectual capital and competitive advantage in Omdurman National Bank, which is a direct relationship.

It is clear from the results of the hypothesis (3) that there is a correlation (below the mean) between the preservation of intellectual capital and the competitive advantage through the value of the correlation coefficient (R) = 0.46, is an absolute value that does not determine the form of the relationship between the dependent and independent variable and by reference to the value of the regression coefficient (B) = 0.43, which indicates the existence of a direct relationship between the preservation of intellectual capital and the competitive advantage

The value of the determination coefficient (explanatory powers) is 21% of the changes in the dependent variable (competitive advantage) caused by the future variable (preserving capital). capital) according to the “t-test” at a significant level (5%), where the calculated (t) value was (3.72), with a significant level of (0.001).

It is a value less than the 5% significance level. Accordingly, the hypothesis is accepted, which indicates the existence of a statistically significant relationship between the preservation of intellectual capital and the competitive advantage at Omdurman National Bank, which is a positive relationship.

   It is clear from the results of the hypothesis (4) that: There is a correlation (above the mean) between the assessment of intellectual capital and the competitive advantage through the value of the correlation coefficient (R) = 0.55, which is an absolute value that does not determine the form of the relationship between the dependent and independent variable and by reference to the value of the regression coefficient (B) = 0.31, which indicates a positive relationship between capital evaluation and competitive advantage.

The value of the coefficient of determination (explanatory powers) is 30%.Among the changes in the dependent variable (competitive advantage) caused by the future variable (evaluation of intellectual capital), it is clear from the results of the analysis that there is a statistically significant relationship between the dependent variable (competitive advantage) and the independent variable (evaluation of intellectual capital) according to the “t-test” when Significance level (5%), where the calculated value of (t) was (4.66), with a significant level of (0.000), which is a value less than the 5% level of significance.

Therefore, it is accepted that indicates the existence of a statistically significant relationship between the assessment of intellectual capital and the competitive advantage of Omdurman National Bank.

Conclusion:

Intellectual capital has a role in achieving the competitive advantage in Omdurman National Bank, which is what business organizations of this kind that seek to achieve competition at the local and global levels should pay attention to.

Results:

It consists of:

1- Intellectual capital contributes to achieving competitive advantage in Omdurman National Bank

2- There is interest on the part of the bank’s management in developing intellectual capital.

3- Bank employees are evaluated on an ongoing basis with the participation of all departments.

4- The Bank’s management is interested in developing the physical and mental capabilities of the employees through courses and foreign missions.

 Recommendations:

The research reached a number of recommendations represented in:

1- The need to establish a special unit for intellectual capital in the bank, to work on developing special plans, following up on their implementation and monitoring them.

-2Attracting qualified administrative competencies to work in the field of intellectual capital in the bank to achieve better performance that helps it compete internally and externally.

-3Paying attention to ways of measuring and methods of intellectual capital in different departments, and supporting it with the elements of success, because it contributes to the development of competitive advantage.

-4The training process for employees must be continuous to develop intellectual capital.

Refrensses:

1- Hassan, Rawya (2003) A Strategic Approach to Planning and Development of Human Resources, Alexandria: University House for Publishing and Distribution, pg. 367

2- Al-Salami, Ali (2001) Strategic Human Resources Management, Cairo: Gharib Publishing House, p. 104

3- Finjan, Musa Ghanem (1990) Modern Trends in Human Resources Management, Baghdad: Al-Raya Press. pp. 112-113.

4- Abdo, Hani Mohamed Al-Saeed (2008) Intellectual Capital: A Contemporary Administrative Start, Cairo: Dar Al-Sahab for Publishing and Distribution, p. 53.

5- Habaineh, Muhammad (2007) The Role of Intellectual Capital in Enhancing the Competitive Advantage of the Institution, Unpublished Master’s Thesis, College of Graduate Studies, University of Aleppo.

6-. Mazlan, (2005), (The Influence of Intellectual Capital on the Performance of Telecom Malaysia), PhD, Thesis, Engineering Business Management, Business & Advanced Technology Centre, University of Technology