Examining Strategic Planning and Use of Intellectual Capital through Spectacles : A study on how small businesses implement intellectual capital into their strategic planning using cases of independent optical firms
Abstract: In the business world of today and the knowledge-based economy that we are living in, with challenges such as digitalization and globalization, traditional sources of competitive differentiation are being stripped away. Due to this more businesses have started realizing their core capability to be the invisible assets of their firm rather than the visible ones. Factors such as knowledge, routines and relationships have become fundamental for companies’ long-term profits and survival. These intangible resources are usually referred to as a firm’s intellectual capital. Working with the intellectual capital has become especially crucial to small independent businesses in the retail sector as they have had to experience a lot of challenges and threats from large increase in online stores, franchising and chain owned stores. Therefore, intellectual capital resources, such as multi-skilled employees, information systems and societal relationship, are valued high and as important drivers for small business of today. Furthermore, this increased essentialness of intellectual capital has influenced the formulation and implementation of strategies in these small businesses. It has therefore become important for these businesses to create a strategic fit between the opportunities available on the market and the organization and its goals. The process of doing this is referred to as strategic planning. As the literature published on the topic of intellectual capital implementation in strategic planning of small businesses is limited to only a few studies, this called for further exploration of the area. Thus, the purpose of this study was to explore the role of intellectual capital in the strategic planning of small retail companies. The study looks at how small companies in the retail sector, through a multiple-case study in the optical retail industry, uses intellectual capital in their strategic planning and what they assess to be the benefits and risks by doing so. This was done through answering the research question: “How do small retail businesses implement intellectual capital in their strategic planning and what are the risks and benefits associated with it?” Through a qualitative study with data collected from semi-structured interviews, this study operated inductively but in comparison with existent literature to end up with a formulated conceptual model of how small retail businesses implement intellectual capital in their strategic planning. The concluded model starts with the drivers, continued bythe actual planning process divided in two parts. The first part consisting of the core elements: inputs, goals and objective setting, division of responsibilities, strategy assessment and selection. The second part is the actual implementation of the planned activities. The model ends with the evaluated outcomes.Additionally, theoretical insights were given into benefits and risks surrounding the topic. In terms of practical contributions, the study provides a framework that can help guide other small retail business managers on how to implement intellectual capital into their strategic planning and provide them with support in estimating the risks and benefits. It also provides practical support to other industries and companies facing the challenges of today.
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