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Stewart McKie

28 September 2005

Intrallectual Capital
Innomation believes that intrallectual capital, defined as the collective intellectual capital within an innovation network, will help drive the next phase of innovation in the emerging knowledge economy. Traditionally, the concept of intellectual capital has been focused on an internal perspective. The challenge ahead is to expand the domain of intellectual capital to operate within a truly collaborative innovation network. Intellectual capital is often defined as the knowledge embodied in the human, process and network/relational capital of a business. Today, much of the job of knowledge management is to catalyze, capture/codify and communicate this intellectual capital within the business so that innovation can thrive. But Innomators know that the scope of intellectual capital will need to extend beyond the firewall to create market-driven knowledge bases that are shared among a close network of partners – including prospects. Many businesses already operate in a dependency network of partnerships and are increasingly developing products and services collaboratively. The software industry is an obvious example. Vendors, value-adding partners (e.g. ISVs and VARs) and customers all participate in the building and implementation of a transformational business solution. The traditional concept of a “solution” as simply a convenient package of products and services is a dinosaur in the knowledge economy. A transformational business solution is merely enabled by the tangible package of delivery services and solutions; it depends much more on an accompanying intangible package of knowledge. The challenge for the software industry and many other high-tech businesses is to quickly develop their capacity to create intrallectual capital ecosystems. The primary purpose of these ecosystems is to foster, maintain and leverage a shared intrallect. It is this intrallect that will drive the partnership forward and enable it to beat the competition to deliver the kinds of transformational business solutions that in turn drive innovation. The levels of trust and interaction required to create genuinely useful intrallect represent the next level of collaboration – beyond mere collaborative design for example. This kind of collaboration has to begin with a clearly agreed shared purpose with rewards for all participating stakeholders. An intrallect should never be dominated by one intellect (i.e. one dominating set of intellectual capital), it’s value is the sum of its parts. The development of intrallectual capital is the ultimate expression of so-called open vs. closed innovation.

Copyright Stewart McKie, 2005. For permission to re-use/quote contact