The use of intellectual capital to obtain competitive advantages in regional small and medium enterprises

Abstract

Entrepreneurs use resources and capacities to form core competencies. These are competitive advantages if they produce better company performance. Intellectual capital (IC) is a key resource for competitive advantage. This paper analyses the process through which entrepreneurs use this resource to obtain competitive advantages in regional SMEs. We show how entrepreneurs constitute three core competencies with IC and territory: internal knowledge management, relationship management and innovativeness. By partial least squares techniques we demonstrate that: (i) the two first factors influence innovativeness; (ii) this dynamic affects company performance. The study contributes to the analysis of the process of building core competencies by the entrepreneur from IC, in order to get better company performance.