Knowledge Capital

Dictionary Says

Definition of 'Knowledge Capital'

An intangible asset that comprises the information and skills of a company's employees, their experience with business processes, group work and on-the-job learning. Knowledge capital is not like the physical factors of production - land, labor and capital - in that it is based on skills that employees share with each other in order to improve efficiencies, rather than on physical items. Having employees with skills and access to knowledge capital puts a company at a comparative advantage to its competitors.

Investopedia Says

Investopedia explains 'Knowledge Capital'

Businesses develop knowledge capital by encouraging employees to share information through white papers, seminars and person-to-person communication. Knowledge capital is important because it reduces the odds that a company will have to "reinvent the wheel" each time a particular process is undertaken because its employees have access to documents detailing the necessary steps, and personnel who have undertaken similar activities.

Sign Up For Term of the Day!

Try Our Stock Simulator!

Test your trading skills!

Related Definitions

  1. White Paper

    An informational ...
  2. Economic Moat

    The competitive ...
  3. Comparative Advantage

    The ability of a ...
  4. Soft Economic Moat

    A type of ...
  5. Narrow Moat

    A slight ...
  6. Wide Economic Moat

    A type of ...
  7. Operating Income

    The amount of ...
  8. Risk

    The chance that ...
  9. Earnings Before Interest & Tax - EBIT

    An indicator of ...
  10. Inventory Turnover

    A ratio showing ...

Articles Of Interest

  1. Competitive Advantage Counts

    What's the best indicator of a company's future success? Its ability to succeed when others fail.
  2. Advertising, Crocodiles And Moats

    Memorable advertising is a brick in the fortress that keeps competitors at bay.
  3. Economic Moats: A Successful Company's Best Defense

    Find out why some companies thrive while others flounder.
  4. 3 Secrets Of Successful Companies

    Make smart investments by spotting up-and-coming success stories early.
  5. Finding Undiscovered Stocks

    Wall Street tends to focus on large cap stocks, leaving other stocks under-followed and undervalued.
  6. Tips For Controlling Investment Losses

    A profit/loss plan helps investors recognize mistakes and invest logically, rather than emotionally.
  7. How To Find P/E And PEG Ratios

    If these numbers have you in the dark, these easy calculations should help light the way.
  8. How To Make A Winning Long-Term Stock Pick

    Discover the key elements of a good long-term investment and how to find them.
  9. Is Growth Always A Good Thing?

    Getting big quickly looks good, but companies can get into trouble when they do it too fast. Find out how to spot this trouble.
  10. Spotting Profitability With ROCE

    This straightforward ratio measures whether a company is efficient, money-making or neither.

comments powered by Disqus
Recommended
Loading, please wait...
Trading Center