Improving Profitability Measurement: Impact of Intellectual Capital Efficiency on Return on Total Employed Resources in Smart and Knowledge-Intensive Companies

Round 1

Reviewer 1 Report

The article presents a high substantive level and knowledge of the subject by the authors, I congratulate the authors on the original concept. The set goal was achieved, as the research hypotheses were proven. A clear and transparent structure of the article, as well as an analysis of the collected research material. Although the issue of Impact of Intellectual Capital Efficiency on Return on Total Employed Resources was previously analyzed by many researchers, and never fully resolved, it seems that the concept presented by the authors makes sense and gives the possibility of real use. The authors rightly point to the limitations of the study in terms of the number of smart companies taken into account in the study. The solution which Authors propose still needs to be carefully checked and taken into account other tangible and intangible issues and limitations of the surveyed companies. While the ROI modification, supplemented with IC issues, is quite interesting but it`s still subjective and requires a detailed check.

The used research tools should be described in the Materials and Methods section rather than in the Results and Discussion.

The article could be supplemented with more cited sources.

Author Response

All reviewer's comments and suggestions have been addressed. Please see the reviewers' response file.

Author Response File: Author Response.pdf

Reviewer 2 Report

I enjoyed reading the paper and found it interesting. My comments for its improvement follow:

1.) In the introduction, the importance of employees' competencies for a company is supported by citing only one paper that has been authored by authors of the present paper. More references need to be utilized to support this, apart from citing the authors' previous work, as it is an important aspect of the paper. I suggested that the authors also cite at least the following 4 additional papers in order to fortify this statement:

a.) Loureiro, M. G., & Dorrego, P. F. (2010). Intellectual capital on regional innovation systems: Toward the momentum of growth rates of business performance. International Journal of Transitions and Innovation Systems, 1(1), 82. https://doi.org/ 10.1504/IJTIS.2010.037415

b.) Eklund, C. M. (2020). Why do some SME’s become high-growth firms? The role of employee competences. Journal of Intellectual Capital. https://doi.org/10.1108/JIC- 07-2019-0188

c.) Kotsopoulos, D., Karagianaki, A., & Baloutsos, S. (2022). The effect of human capital, innovation capacity, and Covid-19 crisis on Knowledge-Intensive Enterprises’ growth within a VC-driven innovation ecosystem. Journal of Business Research, 139(October 2021), 1177–1191. https://doi.org/10.1016/j.jbusres.2021.10.055

d.) Harris, R., & Moffat, J. (2013). Intangible assets, absorbing knowledge and its impact on firm performance: Theory, measurement and policy implications. Contemporary Social Science, 8(3), 346–361. https://doi.org/10.1080/21582041.2012.751498

 

2.) In line 62, the authors first mention "The EIC conceptual framework". They should explain the term EIC here. Many other acronyms are not explained in the text. E.g. ICVA, ROA, etc. Please check that you have explained all acronyms in their first occurrence within the paper.

 

3.) Please check for spelling errors. E.g. in the title of section 2.1 (line 72) "Definision" --> "Definition".

 

4.) (Lines 273 ff) I would suggest breaking up the hypotheses into sub-hypotheses for each one of the indicators (i.e. H1a, H1b and H1c, etc.). Moreover, I believe that the hypotheses should also be visible in Figure 1. Therefore, I suggest that the figure is re-organized in a way that the arrows depicted will be accompanied by the corresponded hypotheses (e.g. H1a above an arrow that will connect Eiag with ROA, etc,

 

5.) In line 298, the authors state that "The sample includes smart companies that are on the top 50 Interbrand list of most 298 valuable brands". They need to explain how and why they decided to select this sample for their study, and why this sample is indicative of the big picture (make a more detailed explanation of your sampling technique).

 

6.) In the materials and methods section (section 3), you need to explain your statistical analysis methodology. By reviewing the description of your results that follow in section 4, I see that for instance you need to explain that you first utilized descriptive statistics in order to accomplish X and Y, then you employed the Shapiro-Wilk and Shapiro-Francia tests for normality for this and that reason, Spearman, correlations, regressions, etc., as well as details on each one and the way it was utilized ans interpreted. I also suggest that you build a figure at the end of section 3 that summarizes your analysis strategy (steps you followed), the methods used in each step of the analysis, and the aim of each step in the analysis you performed.

 

7.) Please also check for grammar issues. E.g., in lines 312 ff: "the minimum value of 0.36 has IBM" --> "IBM has...", or "the minimum...was recorded by IBM". Same with other companies mentioned after IBM.

 

8.) In lines 402 - 422 the authors discuss their results. Firstly, this part should be placed in a separate section (entitled "discussion"). Additionally, the results should be discussed in more detail. The authors claim that "The results obtained in this study cannot be compared to the results of other studies 402 as there are no previous papers that have applied this methodology and these indicators". However, they have referred to a number of studies in the background section within the same field. They need to connect their findings somehow to prior research they have presented in the background section. 

 

9.) The conclusions section starts off too abruptly. It is customary to start this section with a brief outline of what the study aim was, how it was researched in the context of the study, and what the main findings were (summary).

 

10.) I suggest that the authors explain all the acronyms (again) in the conclusion, so that the reader who moves directly to the conclusion (many do so in practice) can understand better the content without the need to move back and forth in the paper to find what each acronym means..

 

11.) There is quite a lot of self-citation in the references section. I counted at least 6 out of the 37 references used that were (co-)authored by one or more of the authors of this paper. The authors need to try to include more references from other sources (as already suggested) and explain more the content of the referenced paper where they cite their own work in the paper (to make it better understandable why it was important that they cite their work in each case).

Please check grammar and spelling throughout the document. I have pointed out some errors, but other may exist.

Author Response

All reviewer's comments and suggestions have been addressed. Please see the reviewers' response file.

Author Response File: Author Response.pdf

Reviewer 3 Report

The manuscript shows the use of the EIC methodological framework as an IC measurement solution. The authors propose the use of EOR (Efficiency of Use of All Resources Employed), implemented from another research developed by one of the authors.

The manuscript is divided into 5 chapters, including Introduction, Theoretical Aspects, Materials and Methods, Results and Discussion, and Conclusions.

 

 

1. A table of abbreviations can be used (at the end of the manuscript) for easier reading and following the context. The use of abbreviations in the summary (EIC) is invisible. Example: In line 40, authors "IC" means how it is used for the first time.

2. Some of the references used should also be presented, such as IAS 38, FRS, IFRS, GAAP, etc.

3. The use of variables must have the same form throughout the manuscript - line 44 uses "goodwill", line 124 "goodwill"

4. The period in which the data were used is between 2012-2019, excluding newer data, as the authors considered that this data is damaged by the period of the COVID-19 pandemic. So, the data frame is small and this adds up to …

5. Only 50 most valuable brands for the period 2012-2019 were analyzed. This has a significant influence on the results (as the authors acknowledge)

As he personally believed, "business as usual conditions" have changed massively after the COVID-19 pandemic and should be considered in the research.

6. In table 7 the Mean is calculated, and in the next paragraph the authors use the "average value" of Efficiency. Authors should specify if there are the same.

Author Response

All reviewer's comments and suggestions have been addressed. Please see the reviewers' response file.

Author Response File: Author Response.pdf

Round 2

Reviewer 2 Report

I would like to congratulate the authors for improving the paper. I would suggest that more information is provided as per the self-cited papers (just say more things based on the content of your cited work). Also I suggest that you include a figure depicting your hypotheses and the results of your analysis.

Author Response

Please see the attachment.

Author Response File: Author Response.docx