Definition of Intellectual Capital

Intellectual capital is the intangible value for the company which is gained by the value of its people, their knowledge, expertise, soft and hard skills, business and product information, and anything that gives the company a big competitive edge. Intellectual capital value is not easy to measure and not shown on the balance sheet.

Companies spend much money, time, and resource to develop their people and improve their overall organizational processes. Though intellectual capital didn’t give direct return to the companies it enhanced the intellectual level of its people, skillset and expertise, organizational process, etc. that generate maximum profit for the organization.