In The News

What gets measured, gets managed
Economic Times, December 31, 2005

Excerpts from interview with S R Gopalan, founder, Bizworth India.

How important is human capital as a constituent of intellectual capital?

Intellectual capital is generally divided into three segments. At the centre is human capital which is supported by what is getting increasingly described in the IC world as structural capital.

Why is IC rating important for Indian companies?
The core value of Indian companies is indeed intellectual capital, and Indian companies often have to make up for their relative weakness in physical / financial capital compared to companies in the advanced world by highlighting their intellectual capital.

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The Latent Value of Corporations
Business World, December 05, 2005

There is a need for CEOs and CFOs to delve deeper into issues relating to intellectual capital and to unearth the latent value of their companies. CEOs and CFOs are well aware that market capitalisation represents a corporation's future value, whereas book value indicates the current value of net physical assets. The difference is explained by intangibles like goodwill, market leadership and patents. These intangibles contribute to the latent value of a corporation. Over time, the latent value of corporations has been increasing phenomenally.

India Inc. has also begun to look into their latent value and manage intellectual capital in a formal way. Companies like Infosys, MindTree and even e4e are pioneering these efforts. In its annual report, Infosys states the value of its human capital and brand, while e4e and MindTree are working on their IC Rating.

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