INFLUENCE OF INTELLECTUAL CAPITAL ON ORGANIZATIONS COMPETITIVE ADVANTAGE A SURVEY OF INSURANCE COMPANIES IN MERU COUNTY

Abstract

This study sought to analyze the influence of intellectual capital on competitive advantage. The specific objectives were to determine the influence of innovation capital, human capital, on competitive advantage. The main challenge facing the intellectual capital in Kenya, is most organization putting more infancy on the intellectual capital of the management and unwillingness to change even though it can give the organization a better competitive edge in the already flooded market. The study employed descriptive research design and the target population consisted of 115 departmental heads in the insurance companies in Meru. The sample size was determined by calculating 50% of the number of departmental heads in each Insurance Company resulting to a sample size of 55 respondents. Primary data was collected using open ended and close ended questions. Descriptive statistics and multiple linear regression was used to analyze the data which was presented in the form of frequency tables and percentages. The output given from the findings indicate that there is a significant positive relationship between innovation capital, human capital and competitive advantage of insurance companies. It was recommended that: Understanding of customer is a key ingredient of intellectual capital to creating a solid relationship between an enterprise and its customers. Employees of insurance companies should possess technical, interpersonal, and conceptual skills to effectively plan, lead, organize and control the enterprise effectively leading to increased performance and consequently competitive advantage.