Impacts of intellectual capital on process innovation and mass customisation capability: direct and mediating effects

Abstract

This paper presents an empirical survey study. We propose a model to examine the individual and joint effects of the three components of intellectual capital (i.e. human, social and structural capital) on process innovation and mass customisation (MC) capability. The hypotheses are empirically tested using structural equation modelling and data collected from 645 manufacturing plants in 10 countries/regions. The results show that human and social capital are positively associated with structural capital. Human capital directly improves both process innovation and MC capability. The direct effect of social capital on MC capability and that of structural capital on process innovation is positive and significant. Moreover, process innovation is positively associated with MC capability. In addition, we find that structural capital mediates human and social capital’s effects on process innovation, and process innovation mediates human and structural capital’s effects on MC capability. This study contributes to the literature by providing insights into how human, social and structural capital jointly improve process innovation and MC capability, as well as how the different types of knowledge residing in a manufacturer affect MC capability development.

Keywords:

• intellectual capital
• process innovation
• mass customisation
• empirical study
• GMRG