The Mediating Effect of Innovation in the Relationship between Intellectual Capital and Institutional Performance
DOI:
https://doi.org/10.37641/jimkes.v14i3.5306Keywords:
Human Capital, Innovation, Institutional Performance, Relational Capital, Structural CapitalAbstract
In knowledge-intensive organizations like higher education institutions, the connection between intellectual capital and institutional performance has recently drawn significant academic attention. This study examines whether human, structural, and relational capital individually contribute to better institutional performance through innovation. With a sample of 242 academic staff and structural leaders from public and private universities, the study employed Partial Least Squares Structural Equation Modelling (PLS-SEM) using SmartPLS 4 software. According to the results, innovation is significantly and positively influenced by all three elements of intellectual capital. Furthermore, relational capital and innovation both exert significant direct effects on institutional performance. Innovation fully mediates the relationships between human capital and institutional performance, and between structural capital and institutional performance, while partially mediating the relationship between relational capital and institutional performance. This study concludes that human and structural capital do not significantly improve institutional performance without the intervening role of innovation, whereas relational capital contributes significantly to institutional performance both directly and through innovation. These findings extend the intellectual capital–innovation–performance framework beyond its conventional commercial origins into the higher education context, offering actionable insights for institutional leaders and policymakers seeking to leverage knowledge assets for sustainable performance improvement.
Downloads
References
Al‐Tabbaa, O., & Ankrah, S. (2019). ‘Engineered’ university-industry collaboration: A social capital perspective. European Management Review, 16(3), 543–565.
Ali, Q. B., Zin, M. L. M., & Ismail, S. A. B. (2024). The role of human capital, structural capital, and relational capital in higher education institutions performance. Journal of Management Info, 11(2), 185–196.
Asiedu, M. A., Anyigba, H., Ofori, K. S., Ampong, G. O. A., & Addae, J. A. (2020). Factors influencing innovation performance in higher education institutions. The Learning Organization, 27(4), 365–378.
Azhari, A. M. B., & Hasibuan, D. H. M. (2023). The effect of green investment, intellectual capital disclosure, and carbon emission disclosure on firm value. Riset: Jurnal Aplikasi Ekonomi Akuntansi dan Bisnis, 5(2), 1–15.
Barney, J. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99–120.
Bontis, N. (1998). Intellectual capital: An exploratory study that develops measures and models. Management Decision, 36(2), 63–76.
Chatterji, N., & Kiran, R. (2023). The influence of human, organizational and relational capital of universities on their performance. Journal of Intellectual Capital, 24(3), 799–829.
Creswell, J. W., & Creswell, J. D. (2017). Research design: Qualitative, quantitative, and mixed methods approaches. Thousand Oaks: Sage Publishing.
Damanik, D. G., & Rizky, M. C. (2025). HCM’s role in driving innovation and creativity in the workplace. International Journal of Accounting, Business, and Economic Policy, 1(2), 81–85.
Darban, G., Karatepe, O. M., & Rezapouraghdam, H. (2022). Does work engagement mediate the impact of green human resource management on absenteeism and green recovery performance?. Employee Relations: The International Journal, 44(5), 1092-1108.
Dorozhkin, E. M., Leontyeva, T. V., Scherbina, Y. Y., Shchetynina, A. V., & Pecherskaya, E. P. (2016). Teacher’s labour as a tool of forming human capital of higher school graduates. International Electronic Journal of Mathematics Education, 11(7), 2773-2787.
Fariz, F. (2019). Human resources competencies in economics higher education provider in East Java, Indonesia: The determinant of organizational performances. Asia Pacific Management and Business Application, 8(2), 133–144.
Fariz, F. (2022). Quality improvement strategy for strengthening higher education competitiveness. Khazanah Sosial, 4(2), 272–283.
Fariz, F., & Winarsih, T. (2024). Enhancing competitive advantage of higher education institutions through knowledge management and information technology. Innovative: Journal of Social Science Research, 4(2), 200-212.
Fornell, C., & Larcker, D. F. (1981). Evaluating structural equation models with unobservable variables and measurement error. Journal of Marketing Research, 18(1), 39–50.
Gim, G. C., Ooi, S. K., Teoh, S. T., Lim, H. L., & Yeap, J. A. (2022). Green human resource management, leader–member exchange, core self-evaluations and work engagement: the mediating role of human resource management performance attributions. International Journal of Manpower, 43(3), 682-700.
Hair, J. F., Risher, J. J., Sarstedt, M., & Ringle, C. M. (2019). When to use and how to report PLS-SEM. European Business Review, 31(1), 2–24.
Hanifah, H., Abd Halim, N., Vafaei-Zadeh, A., & Nawaser, K. (2022). Effect of intellectual capital and entrepreneurial orientation on innovation performance. Journal of Intellectual Capital, 23(6), 1175–1198.
Hassan, H., Kamaluddin, A., Saad, S., Haron, N. Q., Hamzah, N., & Kusumaningtias, R. (2022). Intellectual capital performance in higher education institutions. International Journal of Academic Research in Business and Social Sciences, 12(11), 2176–2191.
Hinduja, P., Mohammad, R. F., Siddiqui, S., Noor, S., & Hussain, A. (2023). Sustainability in higher education institutions in Pakistan. Sustainability, 15(4), 3406-3419.
Huang, C.-C., & Huang, S.-M. (2020). External and internal capabilities and organizational performance. Asia Pacific Management Review, 25(2), 111–120.
Ibarra-Cisneros, M. A., Reyna, J. B. V., & Hernández-Perlines, F. (2023). Knowledge management, intellectual capital and innovation in higher education. Education and Information Technologies, 28(8), 9685–9708.
Iqbal, A., Latif, F., Marimon, F., Sahibzada, U. F., & Hussain, S. (2019). From knowledge management to organizational performance. Journal of Enterprise Information Management, 32(1), 36–59.
Kaplan, R. S., & Norton, D. P. (2005). The balanced scorecard: Measures that drive performance. Harvard Business Review, 83(7), 172–180.
Maier, C., Thatcher, J. B., Grover, V., & Dwivedi, Y. K. (2023). Cross-sectional research in IS. International Journal of Information Management, 70(1), 102-116.
Mamilla, R., & Yen, Y. Y. (2026). Intellectual capital and innovation in HEIs. Frontiers in Education, 11(1), 174-182.
Marulanda-Grisales, N., & Vera-Acevedo, L. D. (2023). Intellectual capital and competitive advantage in HEIs. Knowledge Management Research & Practice, 21(5), 957–971.
Muslim, S. S. (2025). Madrasah culture of achievement. International Review of Social and Cultural Studies, 1(1), 24–31.
OECD (2018). Oslo Manual 2018: Guidelines for collecting, reporting and using data on innovation. Paris: OECD Publishing.
Panjaitan, R., & Siahaan, J. (2025). Financial technology and intellectual capital in banking performance. Jurnal Ilmiah Akuntansi Kesatuan, 13(2), 283–296.
Pedro, E. de M., Leitão, J., & Alves, H. (2020). Intellectual capital and quality of life in HEIs. Sustainability, 12(2), 479-498.
Pedro, E., Alves, H., & Leitão, J. (2022). In search of intangible connections: Intellectual capital, performance and quality of life in higher education institutions. Higher Education, 83(2), 243–260.
Rehman, W. U., Jalil, F., Saltik, O., Degirmen, S., & Bekmezci, M. (2024). Strategic innovation and intellectual capital in HEIs. Journal of the Knowledge Economy, 15(1), 4161–4202.
Saqib, Z. A., Zhang, Q., Ou, J., Saqib, K. A., Majeed, S., & Razzaq, A. (2020). Education for sustainable development in Pakistan. International Journal of Sustainability in Higher Education, 21(6), 1249–1267.
Shahbaz, M. H., Durrani, M. K., & Sharif, S. (2024). Academic innovation and performance. International Journal of Innovation Science, 17(5), 1192–1209.
Subramaniam, M., & Youndt, M. A. (2005). Intellectual capital and innovation capabilities. Academy of Management Journal, 48(3), 450–463.
Winarsih, T. (2024). Innovation and organizational performance in public universities. Pakistan Journal of Life & Social Sciences, 22(2), 1057-1069.
Winarsih, T., & Fariz, F. (2025). Employee stress and well-being evolution. Jurnal Ilmiah Manajemen Kesatuan, 13(3), 1669–1682.
Wu, Y. J., & Chen, J.-C. (2021). Curriculum innovation in higher education. The International Journal of Management Education, 19(3), 550-561.
Zammel, B. I., & Najar, T. (2024). Nexus between technological capital, organizational structure and knowledge sharing in organizational restructuring initiatives. VINE Journal of Information and Knowledge Management Systems, 54(4), 896–915.
Zhang, J., Jiang, H., Wu, R., & Li, J. (2019). Knowledge sharing and innovation networks. Journal of Management, 45(7), 2635–2665.
Zhang, N., Cheng, L., Sun, C., Callaert, J., & Van Looy, B. (2023). Inter-organizational networks and innovation. Scientometrics, 128(7), 4117–4136.
