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Chapter 1. Introduction
1.1 Research Motivation
According to Taiwan “Small and Medium Enterprise Administration, Ministry of Economic Affairs”1, in 2013 the recorded number of SMEs in Taiwan is 1,331,182 with a growth of 2.09% from 2012, where 2012 has a growth rate of 1.48%. In
addition, the number of employed employee in the SME market is 8,588,000. Small and medium enterprises (SMEs) account for 60 to 70 per cent of jobs according to the data in “Organization for Economic Co-operation and Development”2, with a
particularly large share in Italy and Japan, and a relatively smaller share in the United States. Throughout they also account for a disproportionately large share of new jobs, especially in those countries which have displayed a strong employment record, including the United States and the Netherlands. Some evidence points also to the importance of age, rather than size, in job creation, young firms generate more than their share of employment. However, less than one-half of growing companies survive for more than five years and only a fraction develops into the high-growth firms which make important contributions to job creation. Small firms also tend to invest less in training and rely relatively more on external recruitment for raising competence.
With emerging new competitive industries locally and internationally, small medium enterprises (SMEs) need to find resources to stay above the water. Most common practice is information gathering and analyzing, thus the practice of
competitive intelligence comes into place. Deschamps (1995) identified three types of competitive intelligence, all focused on the external environment and internal tangible advantage, where intangible advantage, such as human capital and social capital are not a “knowledge” base contributor to competitive intelligence. Buller and McEvoy (2012) disagrees, their research framework consider human capital and social capital to have a huge impact on competitive advantage through strategy. Human capital is generally defined as the knowledge, skills and abilities individually and collectively contained in the firms’ human resources (Becker, 1964). Whereas social capital refers
1 http://book.moeasmea.gov.tw/book/
2http://www.oecd.org/cfe/smes/
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to the nature of the relationships, such as social structures and processes, those that are among people internal and external of the firms (Nahapiet and Ghoshal, 1998).
Luu (2015), using a Vietnam shipping company, pointed out that knowledge sharing within the organization is crucial to the enhancement of competitive
intelligence. Luu’s (2015) research, found that where there is culture of sharing knowledge within organization, this culture can play a positive role in competitive intelligence scanning. Slocum et al (2014) pointed out that a company’s human resources function can provide an essential set of strategically relevant activities, where the research found out that human resource practice of recruitment/selection and training/development are instrumental in developing human capital. From these two researches, this paper draws upon the idea of finding innovative ways from human resource for SMEs to battle upon the competitive battleground.
Competitive intelligence information laid the foundation of the firms’
innovation processes and competitiveness (Tanev and Bailetti, 2008). To analyze the information about the competitive environment is crucial for the organization to successfully introduce new products, processes and services (Tidd et al., 2001; Salles, 2006). Starting a company within Taiwan, with limited resources and finding a competitive advantage over other companies can become a hard time. Where in the past having the latest data can put a company one huge leap at a time, nowadays having the information all over the web, has decreased that one huge leap to one step at a time. However, due to these huge amounts of data, it has also confused new start-up companies, this information are soaked start-up and reproduce as a mess within the company’s strategy.
Thus this paper introduces a new “Human Intelligence” (HI) to the playground in addition to market intelligence, competitor intelligence and technology intelligence identified by Deschamps (1995). The term HI according to Wikipedia is the capacity in which it takes on a more psychological approach3. Where in the psychological approach takes on an individual form, of how far an individual is able to achieve.
However, this paper uses this term from an organizational approach, to be more precise in a form of a team. The human in HI is referred to the practice of human resource management, rather than the biological term of human, homo-sapiens.
3 https://en.wikipedia.org/wiki/Human_intelligence
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In Deschamps (1995) competitive intelligence, market intelligence focuses on the organizations now and future, competitor intelligence focuses on the resources of the competitors and technology intelligence is on what new methods or tools are available for analysis. HI will focus more on internal human resource practices, of which this paper hopes in return will help start-up companies to find an innovative idea to be competitive with other SMEs via building the right team members.
1.2 Research objective
This paper takes on a qualitative approach, where it aims to introduce an additional “Human Intelligence” to the competitive intelligence model identified by Deschamps (1995). This addition is to help start-up companies to deal with having limited resource, yet still be able to find a competitive way within their intangible assets, mainly human resource. Where industries vary from one another, this paper hopes to provide an insight to how intangible assets, including innovation, leadership, team dynamics can be used to create competitive advantage for SMEs.
Thus based on the above purpose, this paper’s purpose is to propose a framework under the terminology of “Human Intelligence” (HI) that bases on team analysis which will serve as a guideline for Start-up Company.
1.3 Research Procedures
This paper begins with the introduction. Next literature review covers three topics: Innovation, Competitive Intelligence, and Human Resource Competitive Advantage. Using the collected data and interview, this paper explores three
companies for a depth analysis. This paper ends with a conclusion. Figure 1 illustrates the research procedures.
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Figure 1. Research Procedure
Introduction
•Research Motivation
•Research Objective
Literature Review
•Innovation
•Competitve Intelligence
•Human Resource Competive Advantage
•Team Peformance
Interview
•Research/Observation Data
•Interview
Analysis
•Result analysis
Propose Framework
Conclusion
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