Design of a weighted and informed NK model for intellectual capital-based innovation planning

Highlights? An extended NK model offers a systemic and flexible tool for innovation planning using intellectual capital components. ? Non-binary and weighted intellectual capital components with non-integer complexity model an organization better. ? Regression analysis result gives initial conditions for path searching and is more informative than theoretical assumptions. ? Small world communication network allows heterogeneous staff reaches higher innovation performance through knowledge sharing. Innovation is the driving force for value creation and future survival of an organization. This paper proposes a study of organizational innovation performance with an intellectual capital-based view using complexity theory. It presents the methodologies and model for the study integrating survey study, structural equation modeling and an extended NK model. The constraints of NK model applying in management studies are also addressed. The model is developed based on the NK model, with extensions to allow non-binary alleles, non-integer degree of complexity and weighted contribution of different intellectual capital (IC) components to the fitness value of innovation performance. The weighted and informed NK model simulates an organization's search for better innovation performance with the consideration of the current IC status of the organization, and the unique complexity and interdependency among the IC components. The methodologies and the simulation model have been applied on a R&D group in the information and communication technology industry with results that demonstrated the descriptive and predictive power of the model.