The Role of Intellectual Capital on Public Universities Performance in Indonesia

Intellectual capital is anticipated as the key factors that could contribute to universities performance and create value for globally competitive advantage. Accordingly, this study investigates the role of intellectual capital and its elements: namely human capital, structural capital and relational capital, on the public universities performance in Indonesia. A total of 177 respondents representing from 8 top public universities in Indonesia were involved in the study. The Partial Least Square (PLS) was used to test the hypotheses. The result found that there was a significant relationship of Intellectual Capital (IC) and its elements on universities performance. Conclusively, it is wise to recommend to the university to invest in intellectual capital consisting of human capital, structural capital and relational capital. Also, these elements should be used as a new model for measurement of the university or higher education institution performance so that it provides added value to strengthen their competitiveness ability.