Is SMEs Ready to Manage Intellectual Capital?

Intellectual Capital is crucial for high tech modern enterprises. There are various challenges faced by the SME’s in intellectual capital management but the main challenges faced by the SME’s are human capital management. The purpose of the study is to examine various challenges faced by the SME’s in intellectual capital management. Purposive sampling technique has been used in the study. The main eight manufacturing sectors of SME’s were targeted in the study. The sample data was collected from different state of Punjab. Out of 1200 SME’s only 945 SME’s fill the questionnaire. Frequencies are used for analysis. The finding of this paper was that the two major challenges faced by the SME’s in Intellectual Capital (IC) management are ‘lack of entrepreneurial traits’ and ‘training and development is considered as expense in the organization’ This research will provide a valuable framework for entrepreneurs, executives, managers and policy makers in managing intellectual capital within the SME’s. This paper will also helpful for the researcher, academicians and SME’s entrepreneurs about the application of intellectual capital to improve the firm performance.