intellectual capital report 2009 - ipd.gov.hk · intellectual capital report 2009 ... culture, etc....

INTELLECTUAL CAPITAL REPORT 2009

SCHMIDT ELECTRONICS GROUP

Introdution

Migrating to Knowledge-based EraAmidst transforming from the “old” to the “new” economy, our reliance on the physical assets has been waning and our attention has shifted to the “value” that is created primarily from the application of knowledge. The main assets for many knowledge-based companies, in particular the tech-savvy ones like Schmidt, have lain in the form of intellectual. Schmidt Electronics has also undergone the same transformation from a regional distributor of hi-tech instruments a century ago to a systems integrator and technology consultant serving multi-disciplinarily across the electronics and IT industries. Knowledge assets are the most valuable capital for the company, as the powerhouse for innovation and wealth creation, and the distinctive resources that underpin the foundation of company’s competitive standings. Today, Schmidt Electronics has become a technical oriented company with a strong engineering background and extensive service capabilities.

Intellectual Capital The concept of Intellectual Capital (IC) originates from the realization of discrepancy between an organization’s exist-ing accounting value and its market value. IC is the knowledge capability of an organization to convert knowledge, skills and expertise into profitable intellectual assets, that include inventions, technical know-how, design approaches, computer software and programs. Companies who direct their efforts to identifying; creating and nurturing IC will find it rewarding as IC is one of the critical drivers of profitability and revenue.

IC has been conventionally referred to a combination of Human Capital, Structural Capital and Relational Capital. Hu-man Capital includes all the experience, skills, competence and knowledge of people. Structural Capital covers many elements such as business processes, organizational structure, policies procedures, culture, etc. Relational Capital includes business relationships with any outside person or organization. It includes customers, suppliers, stakeholders, brand image, and product and service reputation.

IC Management becomes popular in Asia not until recent years, with the participating countries of South Korea, Malay-sia, China and Japan, where Japan is taking the lead in IC development. Up until now, there are no common standards and guidelines to measure and manage IC.



Established : 1931

Representatives :

Mr. Klaus Festl, Chairman and CEO Mr. Daniel Lin, Chief Finance Officer

Headquarters : Hong Kong

Scope of business :

Data Capture and Information Management; Inspection Systems; Industrial Materials; Electronic Testing and PCBA related services and products.

Number of Staff : 600

Offices locations :

23 offices in China, Hong Kong, Singapore, Taiwan, South Korea, Thailand, Vietnam, Philippines, Malaysia, India

Corporate Information

Schmidt Electronics Group

Mission and VisionsSchmidt’s long-standing committment to Asia can be reflected by its single-minded business focus - bringing the region with the latest and advanced technologies that can optimize the business processes, boost productivity and create values for customers. To achieve this, we leverage our strengths through our deep local knowledge, regional network and global technology, giving our customers the best-in-class and consistent quality of service.

About the CompanySchmidt Electronics Group is a leading multi-disciplinary conglomerate provid-ing technology solutions, consulting services and high-tech electronic systems. Schmidt’s roots can be dated back to Paul Schmidt who founded Schmidt in Tokyo 110 years ago. Leveraging a well-established brand – Schmidt, the Group offers a bundle of value-added products and services to a broad and diverse base of cus-tomers, ranging from automatic identification solutions, industrial materials, inspec-tion systems, prototyping and high quality manufacturing services, to testing and production equipment for the electronics industry. Headquartered in Hong Kong, the Group currently operates around the globe and employs 600-strong associates in 8 countries.

“When I come to know about IC reporting, I realize it is a use-ful tool for knowledge sharing, enabling us to tap into the vast knowledge pool that exists within the company, re-focus on our strengths and pave the ways for value creation” - Klaus Festl, Chairman and CEO, Schmidt Electronics Group.

Schmidt & Co., (Hong Kong) Ltd. - one of the Asia’s leading systems integrators and distributors of Auto-ID and data capture solutions - provides customized and in-tegrated solutions based on Bar-coding, RFID, Wireless Communications, Voice Recognition and Biometrics tech-nologies to a broad base of customers.

Electronic Scientific Engineering Ltd. provides a wide range of consumable materials and tools for the manufac-turing of electronic and electrical products. These include solder products, adhesives, tapes, protective films, insu-lation powder, tooling, soldering stations, and bench type rework stations.

FlexMPE (Shanghai) Ltd. positions itself as a top High Quality EMS/ Prototyping and Turn-key Solution provider. With strong abilities for fast prototyping, high-mix produc-tion in high qualities, the range of services include Final Assembly & Test Services (Turn-Key solutions) and com-prehensive sourcing.

Schmidt Electronics Asia Ltd. sources and distributes production, testing and measurement equipment for the electronics industry in Asia. The company is specializing in Test and Measurement Equipment and SMT Production Equipment.

Company Profile

Subsidiaries



2010 • Hong Kong Most Valuable Company by Mediazone – Schmidt & Co,, (HK) Ltd.

• Caring Company 2008/10 - Schmidt & Co., (HK) Ltd.

2009 • 2009 Hong Kong RFID Awards – Schmidt & Co., (HK) Ltd. Certificate of Merit by GS1 Hong Kong

• Caring Company 2008/09 - Schmidt & Co., (HK) Ltd.

• 2009 Star Performance Award 1st Place by Cinterion Wireless Modules - Schmidt & Co., (HK) Ltd.

• Shoei’s 2009 Sales Achievement Award - Electronic Scientific Engineering Ltd.

2008 • 2008 Hong Kong Awards for Industries - Schmidt & Co., (HK) Ltd.Award Winner of Innovation and Creativity by FHKI

• Hong Kong RFID Award 2008 - Schmidt & Co., (HK) Ltd. Bronze medal and Certificate of Merit by GS1 Hong Kong.

• Greater China MCD Solution Selling Award & Outstanding Performance Award by Motorola - Schmidt & Co., (HK) Ltd.

• Top Zebra Premier Partner & Top Label Player - Schmidt & Co., (HK) Ltd.

2007 • Hong Kong ICT Awards 2007 - Schmidt & Co., (HK) Ltd.Gold Award of the Best Ubiquitous Networking (Mobile Enterprise Solution)

• ISO Certification - FlexMPE HK Ltd.ISO 9001:2000 (Quality and Management System); ISO 14001:2004 (Environmental Management)

• DELO Most Successful Agency - Electronic Scientific Engineering Ltd.

Schmidt’s accomplishment can be seen from a myriad of awards it obtains.

Our new products and management ap-proaches are always of interests among

media.

Our 23 offices spanning across Asia Pa-cific provide an ubiquitous service network

for the customers within their reach.

We care about the work-life balance of our staff. We create various activities for them

to soothe the strains.

The new intranet platform facilitates greatly the knowledge sharing and information ex-

change.

We provide training to ensure our staff to keep abreast with the technological

changes.

Awards & Recognition

HUMAN CAPITAL

STRUCTURAL CAPITAL

RELATIONAL CAPITAL



Results

This section has identified the aspects our stakeholders value the most, which allows us to focus on these and to try to improve them whenever it is possible.

Who we are? How are we shaped and shaping our business universe?

Employees – as a knowledge-inten-sive company, employee’s know-how

and their expertise are foremost important to the company. Employees look for a sta-ble and supportive environment to grow professionally and personally.

Shareholders/ investors – the group provides the financial source to bol-

ster company’s assets and to explore new business opportunities. Some of those might become involved in formulating business strategies. They look for high re-turn on investment and also a healthy and sustained growth of business.

Customers – Schmidt has a broad base of customers from electronics,

manufacturing, logistics to wholesaling and retailing. Nevertheless, they all sought for “good value for money” and “proximity” of our products and services alike. They also require consistent level of service and a long-term relationship with us. The change of demands will also change the course of our business.

Contractors – are the complements to our business by providing services

where we are in lack within the company. We see each other as a counterpart work-ing closely together for value creation to-wards our customers.

Media/ General Public – as a cor-porate-facing business, media and

the public play an indirect role but of the same level of importance as others. Our brand equity relies very much on our re-lationships with them. In return, they also expect the company working in integrity, accountability, and for the well being of the society.

Suppliers – one of our key stake-holders as prices and supply are tre-

mendously crucial for our operations and bottom line. Prompt repayment, regular orders, reputation, knowledge and mar-ket intelligence are our values attached to them, whereas we look for good prices and stable supply from them.

Business Partners – are wide rang-ing, including all kinds of organizations

whether in private, public or charitable sec-tors, which interact with us and facilitate our business. These companies do not necessarily have business relations with us, trade unions, institutes, professional bodies and NGOs are cases in point. They not only play a role in part for wealth crea-tion but the circle also shapes our reputa-tion and standings in the market.



This section explores the areas where our IC lies in the current operation. It also casts a light on what particular areas are important to value creation.

Where to get started? Where can we find our IC?

As the knowledge based company, among those who participated in the survey unanimously agreed that Human Capital is where most our knowledge lies, with nearly 50% of votes. Leadership, teamwork, expertise/work experiences and communications have received the highest ratings across the board, as they are the indispensable components to drive the company forward.

“Schmidt Electronics Group and its companies have been well positioned themselves as the leading IT systems integrator and electronics solution provider in Asia Pacific. As a regional partner, we bring leading edge

technology, international knowledge and local expertise to the table, and earned their trust over years of proximity and understanding what proactive industry leader expect from a company,” says Klaus Festl, Chair-man and CEO of Schmidt Electronics Group.

He adds: “Our long standing commit-ment to Asia and our innovative quest moves the company forward to a new level. We have a strong attach-ment to Asia, which accounts for our 23 regional offices present in all key Asian cities. Undoubtedly, the growth potential is attractive, but our symbio-sis with Asia extends beyond mere commercial advancement. It goes more into the realm of partnership, friendship and the excitement that comes from mutual growth

particularly in terms of understanding each other’s objectives. We are much more prepared and ready to meet the rising demands in technologies brought by growing economies of China and its surrounding countries.”

“In future, we remain focus on IT and electronics development but also look into new opportunities in new tech-nologies that we can integrate into our platform. Our business philoso-phy remains unequivocal: helping enterprises reduce costs, optimize processes and become more produc-tive”.

Mr. Klaus FestlChairman and CEOSchmidt Electronics Group

Structural25%

Human46%

Relational29%



This summary give you a quick glimpse at the IC we have possessed in different areas and it is already up-and-running in generating values.

Where we are? How far have we gone?

Management Strategy & Leadership

• Well-developed structure of management across the operation network with well-defined terms of reference at each level.

• We empower staff and encourage work ownership. • Kick-off meetings to communicate across the organization about company’s strategies and direc-

tions.

Expertise &know-how

• Above 50% of staff are tech-savvy, either acquired related professional qualifications in IT or engineering or related working experience.

• We create dynamic and supportive environment with comprehensive training programs and sponsorships for individuals to grow, ranging from on-the-job-coaching, apprenticeships, profes-sional qualification acquisition and overseas secondment to staff. We also promote cross-depart-mental and cross-regional collaborations.

Entrepreneurship • The company invests in innovation and creativity, channeling considerable resources for new products development. Several new products have been developed such as highly integrated RFID solutions, wireless terminals, among others. Some of them were even regarded as first in the region.

Employee Benefits

• We offer competitive packages to the staff including comprehensive insurance benefits, compas-sionate and marriage leaves, etc.

• We reward staff for their long-term commitments and excellent performance with Long Service Awards and Recognition Awards.

• We encourage work-life-balance by cultivating a healthy and happy working environment by a wide range of plans and programs, along with recreational activities to help them fulfill multiple commitments to work, family and their personal goals.

Brand • Long established brand for 110 years and become well known in industries. • Schmidt has been interviewed by prominent media and broadcasters (data from 2007 – 2009).

- Press/Magazine: 10 - Electronic (TV): 3

• Being reported or cited: - Press/Magazine: 9 - Publications: 8

Awards and Recognition

• Schmidt was granted with several prestigious titles: - ICT Awards 2007 - Special Prize and Gold Medal 2007, Invention Expo Geneva - Hong Kong Awards for Industries 2008 - Hong Kong RFID Awards 2008, 2009 - Hong Kong Most Valuable Company 2010

• The firm also received a number of awards among suppliers to recognize our outstanding per-formance and achievements.

Corporate Social Responsibility

• CSR as an inseparable part of the company’s commitments. The development of better civic consciousness has been pursued through contributing our skills and knowledge to the society and engaging staff in the community.

• Entitled “Caring Company” since 2008• Donations and volunteering.• Apprentice programs for HK’s university students and German & Swiss students from overseas.• Scholarships for universities.

Internal Relations • A dedicated position to handle internal communications. • Communication Ambassador Committee, a direct and 2-way communication channel with man-

agements involved, was set up since 2008. The committee is composed of voluntary representa-tives from different offices and regions and conducts regular meetings with Managing Director and senior managements to exchange ideas.

External Relations • Customers and suppliers can find Schmidt in 23 offices across 8 countries. This extensive network not only offers customers local support within their reach, but also enables them to be served in our multinational network.

• We host workshops and training courses to get customers familiarized with our products and services.

• We take on an active role in support of local government initiatives in countries where we have operations. Our staff also takes up duties in professional associations and advisory boards to foster the development of industries.

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Business Processes

• Detailed work manuals engages in different business processes from procurement, accounting to customer services.

• FlexMPE was awarded with ISO 9001 and ISO 14000 certificates for its service quality and envi-ronmental management commitments.

Incentives • Rule-based incentive scheme and appraisal system.

Intranet • From 2009, we adopt a new intranet platform based on wiki architecture. The new intranet ena-bles everyone in the company to contribute their opinions, knowledge and information, fostering knowledge sharing and transfer in a more transparent and efficient way. These joint efforts also make the creation of a knowledge database across the company a reality.

Communications • We welcome new technologies to make communications more convenient than ever such as online meeting service, Skype for internal communications.

• Regular e-newsletter to update staff and customers about latest developments of the company.

Data Security • Dedicated IT Team to manage information and data. • Data security policy is well in place. • Several data security measures protect us from security breaches:

- Own-developed VPN and firewall to protect inter-office communication, while HTTPS from inflow data.

- Mobile VPN – for those staff who gain access to company’s server from outside network. - Login security for each PC and staff - Digital certificates for emails - Regular systems backup and upgrade

Database • We have well-implemented software and data management system to preserve our knowledge assets, as well as to streamline business and information flow.

• Centralized infrastructure for ERP system – consolidated database for accurate and prompt update.

• eTravel – travel application and expenses claim system. • eAsset Tracking – track and manage fixed assets and their transfer. • Among others: eLeave, eStationary, eProject Accounting, eInventory, etc.

Research & Development

• Several R&D centres were set up in China, Hong Kong, Taiwan and Singapore to integrate new technologies and to develop proprietary products. Schmidt & Co., (HK) Ltd. for example has developed the first-of-its-kind all-in-one RFID reading system, which has won several prestigious innovation awards. Other own-label products include MLiS, Smart Retail System, Elim, WMS, ATS and RSS software suites.

Business fields con-sidered as regional/ national strategies

• China has become the world’s consumer electronics manufacturing centre. One-third of PCB/semi-conductors are produced in China. Not surprisingly, the demands on PCB related equip-ment/products will remain robust.

• On the Auto-ID front, there is an ever-growing demand on solutions for data capture and information management to help enterprises cut costs and optimize their business processes. Innovation and technology has been identified as one of the six major industries subject to Gov-ernment’s intensive support in Hong Kong Policy Address 2009.

Patent and Trademark

• Whenever possible, Schmidt will try to protect our intellectual properties through IP registrations. - Design trademark – 1 - Patents – 3 - Trademarks – 17 - Product Certificates – 3 - License agreements - 7

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heavily in potential candidates by spon-soring and mentoring local students and opening apprentice programs in attempt to attract more students to join in the industry”. “Apart from making the work-ing environment a happy and supportive place for all staff to stay on, we also promote job ownership and satisfaction through empowerment. We remain a very flat organization and staff can express and exchange their ideas through many different channels and be able to put them into practice”.

“Maintaining the pool of talents is vital to the company but also very challeng-ing in my daily work. We need to identify and retain the good performing staff while recruiting new bloods to inject new know-how into the company. To achieve this balance, we developed various well-structured programs and trainings to help staff find their goals and pursue steadily their career within the company,” says Kitty Fok, HR Manager. She continued: “To ensure a continuing stream of quali-fied calibers to fill in our places, we invest

Ms. Kitty FokHR Manager, Hong KongSchmidt & Co., (HK) Ltd.



Knowledge Capital Potential Risk Actions to Minimize Risks

• HK’s dynamic labor market exerts constant threats on this issue, without an exception for Schmidt. We will continue to strengthen the communication with staff, create good environment for career progression and improve their job ownership and satisfaction.

• On the other hand, we need to translate that personal expertise to the company knowledge through coaching and incorporating it into structural capital and business procedures.

• To keep staff abreast with new technology, we regularly offer new training programs to allow our staff to gain new skills and bring some fresh motivation.

Expertise

Communications

Brand

Customer Relations

Data Security

Loss of key knowledge workers

Increasing demands of communication channels and social responsibility of the company among the public.

Customers may not fully understand what our company stands for.

Customers may switch to other brands due to compe-tition.

Data security does not keep up with new threats

• We need to undertake regular data security review and deploy new hardware/software when necessary as we always do.

• Subsidiaries were undergoing restructuring and repositioning three years ago. New logos were also introduced at that time. We need to keep up our efforts in reminding customers of our specialities and how we bring them values.

• We are extensively navigating the possible channels to com-municate with external parties. For example, the Group has launched a new website in 2008 with the online enquiry function. Subsidiary companies are also revamping their website to make information more accessible and more user-friendly.

• We need gathering our efforts in promoting civic consciousness in workplace, likewise in the community.

• Keep a strong tie with our customers and understand their indi-vidual needs.

• We will further extend the personal relationship to the company level through strengthening external communication and their attachment to the brands.

• Leverage our strengths on our network, knowledge and technol-ogy to deliver better values and consistent level of service to customers.

How can we bridge the gaps and do it better?



Unleashing our hidden potential - How can we capitalize on these ICs to create further values?

Group. Schmidt’s innovative accomplishment has been rewarded by several prestigious awards in the IT indus-tries in the past few years. Among them are; the Innova-tion and Creativity Awards of the Hong Kong Awards for Industries and Hong Kong RFID Awards in 2008.

As we all know that the well-managed information systems are essential for knowledge transfer and creation, it also bestows us competitive advantages over competition. An efficient management information system expedites prob-lem solving and decision making, supports planning, pro-motes learning and training, as well as encourages decen-tralization. As you might have seen that Schmidt’s heavily digitalized database and business processes are facilitat-ing these tasks, it eases our daily work and makes our operation highly efficient and reliable. Staff can get access to those databases in all our networked offices in no time. This information systems contain enormous intelligence and we need to explore the synergies between them, bridging gaps of inconsistencies and leveraging them fur-ther to create greater values in future.

The results clearly showed us Schmidt contains many knowledge resources that deliver us distinc-tive values to make us the success as we are today.

They are unique, irreplaceable, valuable and also essen-tial to the organization’s survival. This report gives us a chance to culminate those facts and figures, helping us recognize the hidden wealth. However, most important of all, we shouldn’t keep those valuables in a safe, but rather to exploit them and utilize them wisely to create further values. Our brands, people, information system, and in-novation motivations are identified as our powerhouse, to take us into the future.

Good brand takes years to develop. Schmidt has been serving Asia for a hundred years and become well known among practitioners. The extensive service network and strong regional presence across Asia also provides cus-tomers with unique confidence and convenience. We are no stranger to the local customers, the trust, partnership and friendship that built between us throughout the years has become the unique relational asset no one can re-place.

As a knowledge-oriented corporate, expertise with the right skills are utmost important and Schmidt has it. Our long-standing commitment to technology as our core busi-ness has accumulated invaluable heritage within the or-ganization that other companies are unmatched. Further, our competence and capabilities are also backed by the highly skilled workforce with strong engineering back-ground that enables us to deliver solutions catering to individual needs.

As Asia grew and the pace of development quickened, key players had to adapt, just as quickly. Schmidt sees the writing on the wall and moves quickly to reap the win-dows. “Innovation is one of the main engines of growth for a company like Schmidt and we stay innovative by lis-tening to our customers, learning about their requirements and watching for emerging trends. We invest heavily in research and development and this enables us to provide solutions even before our customers expect them”, says Klaus Festl, CEO and Chairman of Schmidt Electronics



“Communications play a vi-tal role to both internal and external stakeholders of an organization. This IC Report is a fantastic means for us to communicate with both parties in a very rigor way, giving them a picture of the invisible ele-ments that play important parts of the company but are rarely revealed in normal channels.” - Flora Chan, Marketing Com-munication Manager

IC Reporting has given us an invaluable chance to review our existing capital, the intangible ones that is never emi-nent to draw enough attention during many of our daily decision-making processes. This report helps us redis-cover this vigor and long-existent assets, defining the in-formation needed for an effective analysis, putting parts together to portray a more intact picture to communicate across the stakeholders.

Our brands, people, innovative culture and well-devel-oped systems are our cornerstones to succeed, which also attach enormous values to the shareholders around us. Those strengths are not only critical to the company for today, but also our future, for shielding us from threats but also preparing us to exploit new opportunities when it comes to our way.

At the same time, this report also serves as a timely re-minder to expose the signs of weakness for our further perfection.

Schmidt has identified the following areas for improve-ment:

1. Put IC reporting as one of the evaluation processes in the company.

2. Look into feasibilities to close the gaps between infor-mation platforms.

3. Find synergies of capabilities, competences and ex-pertise between departments to bring forth innovative creation.

Intellectual Capital is profoundly important to an organiza-tion, we are hoping that through reporting we can become more alert to ICs we encountered in the future.

For more information: www.schmidtelectronics.com

The Way Forward



Company History

1896 Mr. Paul Schmidt first founded the Schmidt Group of Companies under the

name of Schmidt Shoten in Tokyo, selling German medical and laboratory equipment in the Far East.

1911 The first office opened in Beijing, becoming the headquarters in China. Ad-ditional branches were opened across nation.

1931 The first Hong Kong branch opened in the most modern office building at that time.

1953 Schmidt & Co., (Hong Kong) Limited re-registered in Hong Kong, becoming head office of Schmidt Group of Companies, selling Leica camera, scientific and medical equipment for Far East.

1960's The Group diversified its product portfolio to electronic, industrial and com-puter related product lines, which now form a major part of the Schmidt Elec-tronics Group.

1968 Schmidt Scientific Taiwan Ltd. established in Taipei.

1969 Acquired Schmidt Scientific (Malaysia).

1971 Korea Schmidt Co., Ltd. formed in Seoul.

1974 Schmidt Scientific (Pte) Ltd. founded in Singapore. Schmidt Scientific SDN. BHD founded in Malaysia.

1976 C. V. Schmidt Mitra Indonesia formed in Jakarta.

1979 Schmidt & Co., (Hong Kong) Ltd. participated in the group's first exhibition in PRC in Guangzhou and set up service centres in Beijing, Shanghai and Guangzhou.

1980 Electronic Scientific Engineering inaugurated in Hong Kong.

1985 TechTrend Ltd. formed in Hong Kong.

1990 Schmidt Scientific (Thailand) Ltd. established in Bangkok.

1992 Schmidt Vietnam & Co., Ltd. founded with the major investment of three-tower technology building and the Hanoi International Technology Centre.

1993 Schmidt Representative offices established in Shanghai & Guangzhou.

1994 Schmidt Representative office established in Chengdu.

1995 Schmidt Tower opened in Vietnam.

2000 • Advanced DrillTest (Dongguan) Ltd. inaugurated in China• Advanced DrillTest Ltd, G-Tech (HK) Ltd, Schmidt Components Asia Ltd.

established in Hong Kong• Schmidt Components Asia Ltd. Korea Branch formed• Schmidt (Philippines) Ltd. established• Schmidt Components Singapore (Pte) Ltd. and GigaWaveTech (Pte)

Ltd. formed in Singapore• G-Tech (HK) Ltd. Taiwan Branch established

2001 The Group of Companies was restructured into three independent enter-prises:• Schmidt Electronics Asia Ltd.• Schmidt BioMedTech Asia Ltd.• Schmidt Marketing Asia Ltd.

Present Schmidt Electronics Asia Ltd. restructured and four companies were subse-quently formed under the Schmidt Electronics Group.• Schmidt & Co., (Hong Kong) Ltd.• Electronic Scientific Engineering Ltd.• FlexMPE Hong Kong Ltd.• Schmidt Electronics Asia Ltd.



Backgrounds

Statement

Objectives

Methodologies

Since the worlds’ first Intellectual Capital Report emerged in 1995, Intellectual Capital Management (ICM) has come to the centre of stage in providing an alternative tool to evaluate an organization’s assets that cannot be revealed in financial statements. Schmidt Electronics Group was invited to produce the Intellectual Capital Report as a result of participation in the Intellectual Capital Management Consultancy Program jointly initiated by the Intellectual Property Department, Innovation and Technology Commission and the Trade and Industry Department of the HKSAR Govern-ment in April 2009. This also allows the company to reveal its strengths, innovations and developments throughout our business and to share the information with our stakeholders and the general public.

The reporting process of Intellectual Capital (IC) has given the organization a systematic approach to identify and uncover our knowledge assets and competences for better protection and utilization. At the same time, it provides an avenue for the company and external stakeholders to tap into this knowledge reservoir and transform them into “use knowledge” that can further create values and competitive advantages for the company.

The report will cover the following parts: • IC formation process and IC statements • Gauges potential risks that the company will face and how the company puts forward preventive measures to amel-

iorate it. • Shades light on new opportunities that the company can capitalize on with the existing strengths.

• Schmidt Electronics Group recognizes both tangible assets and IC, composed of structure, human and relational capitals are important to the company and need to protect and foster. IC plays a pivotal role for the organization’s sustained growth and also needed to be continuously nurtured and reinforced.

• To identify IC that is important to the company’s business in order to better protect and promote within the organiza-tion.

• To make IC visualized and subject to more systematic approach to evaluate it. It helps management and staff alike more likely to integrate them to the business and decision-making processes.

• To bridge the gap of the corporate values that cannot be reflected by the accounting statements alone, and to serve as a useful supplement to financial reporting.

• Schmidt’s company management structure and organization holds its Intellectual Assets in three main sectors, namely Human, Structural and Relational Capital. We identified the different elements and after analyzing them we went through an evaluation to weight the importance of each. After processing meetings and an internal survey from departmental managements, we arrived the results.

intellectual capital report 2009 - ipd.gov.hk · intellectual capital report 2009 ... culture, etc....

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