Intellectual Capital and Sustainable Competitive Advantage: The Role of Innovation and Managerial Capability
Purpose: The purpose of the present study is to examine the role of innovation and managerial capabilities on the relationship between intellectual capital and sustainable competitive advantage of the commercial banks in Tanzanian context. Based on three theories; the resource based view, knowledge-based view, and resources orchestration, it is hypothesized that; first, intellectual capital (human capital, structural capital, and relational capital) positively influence bank’s competitive advantage; two, innovation performance significantly mediate the relationship between intellectual capital and bank’s competitive advantage, and finally; managerial capability positively moderates the relationship between intellectual capital and bank’s sustainable competitive advantage.
Methods: Survey design was deployed to collect data from commercial banks operating in Tanzania. The collected data were analyzed in three stages. First, data were analyzed using exploratory factor analysis followed by confirmatory factor analysis, and finally, hypotheses were tested using Partial least square – structural equation modeling. In total, the study utilized 406 valid cases to infer the final results.
Findings: The results indicate that human capital, structural capital, and relational capital have a direct, significant, and positive effect on the bank’s sustainable competitive advantage. The results further indicate that innovation positively and significantly mediates the relationship between the intellectual capital and the sustainable competitive advantage of the commercial banks. Moreover, the results show that managerial capability positively moderates the relationship between structural capital and sustainable competitive advantage of the commercial banks. Besides, the results indicate that structural capital has a strongest influence over bank’s sustainable competitive advantage followed by relational capital, and lastly human capital.
Originality: The findings of the study reveal that; sustainable competitive advantage tends to improve when managerial capabilities of the commercial banks are combined with static intellectual capital particularly structural capital. Thus, to achieve such productive combination, the commercial banks need to frequently develop the capabilities of their managers.
Keywords: structural capital, intellectual capital, human capital, managerial capability, relational capital, innovation, and sustainable competitive advantage.
Paper type: Research paper
