THE EFFECTS OF INTELLECTUAL CAPITAL, INNOVATIVE BEHAVIOR, AND ABSORPTIVE CAPACITY ON ORGANIZATIONAL EFFECTIVENESS IN THE SERVICE INDUSTRY IN THAILAND – THE MODERATING ROLE OF SOCIAL CAPITAL

Abstract

The present study explored the association between intellectual capital, employees’ innovative behavior in the workplace, the absorptive capacity of a firm, and organizational effectiveness of the Thai listed companies in the service industry. The survey data were collected from 423 managers from 198 listed companies in Thailand. The results showed that intellectual capital tended to improve the employees’ innovative behavior and the firm’s absorptive capacity, and finally enhance corporate organizational effectiveness. Furthermore, the results from the moderating effect found that the positive relationship of intellectual capital with both innovative behavior and absorptive capacity tended to be significantly higher for the organization which owns a higher level of social capital. The main findings of this study provide theoretical implications to the field of knowledge management and organizational effectiveness, as well as practical implications for managers in service-oriented companies, given that improving intellectual capital tends to bring enhancement of innovative behavior and absorptive capacity, and finally positively impact organizational effectiveness. Thus, these findings imply that managers should effectively manage intangible organizational assets by recognizing and utilizing those resources to reach organizational effectiveness to a higher extent.