Yes, we care about the money, but intellectual capital management is much more than that to us, it's who we are (see also about money investment).
- Jan Hoffmeister, Skandia Group VP of ICM3
Renowned for its Navigator, Skandia's4 name symbolizes the intellectual capital revolution of the time. One that attracts a lot of interest not only for its uniqueness but also because of the vigor with which it is embraced at Skandia. I had the fortune of having a glimpse of this revolution by meeting Jan Hoffmeister, Skandia Group VP for Intellectual Capital Management. It is a revolution indeed because ICM and the Navigator are not seen merely as useful business practices that enable value creation and extraction, but rather as the way of doing business. At Skandia, ICM is a belief system that is so well entrenched in the way the whole organization works that it is hard to discern it as an isolated business process for study. It is a belief so strong in the hearts of business executives that they see themselves not only as agents of change in Skandia, but the whole business environment around Skandia, the whole economy when they can (see also about money investment).
Intellectual capital management at Skandia is far from being a system implemented on a faith basis. It is one that Skandia has proven is of immense value. It was started with the inception of Skandia AFS division in 1986/87. Ten years after its inception the division accounted for 60 percent of the profit of Skandia, growing at the rate of 48 percent annually, and eventually comprising most of Skandia. In a traditional mature industry like the insurance industry, such growth rates defy conventional wisdom.5 This great success is attributed to the unique alliance-based business model that Jan Carendi (the CEO of Skandia AFS division and deputy CEO of Skandia Group at the time) established and to the ICM system - the heart and brains of Skandia's business model (see also about safe investments).
Being a real revolution, Skandia started at home. Skandia's model of ICM was inducted across the whole enterprise of Skandia Group. In 1991, following the success of the Navigator in Skandia AFS, Lars-Eric Petersson, the president and CEO of Skandia Group, rolled out the use of the Navigator across the whole Group, making its use mandatory in 1999. Petersson's commitment to ICM was so strong that he reformulated Skandia Group's vision to "IC the Future." Skandia Group embraced the revolution, which started in Skandia full-heartedly to the extent that it was the first company in the world to publish a formal IC report as a supplement to its financial annual reports from 1994 to 1998.
This case study will survey the evolvement of ICM at Skandia AFS division, the bedrock of the IC revolution, and how it expanded to the rest of Skandia. It will go beyond an examination of the Navigator, as most case studies on Skandia do, to explore how Skandia manages IC at the knowledge, innovation, and IP management stages.