| Summary: | The importance of organisational innovation has received much attention in academic and industrial literature over the years. The ability to innovate in products, services and process is a vital key in generating and sustaining competitive advantage in an increasingly crowded and complex marketplace. The present study is mainly aimed at examining the effects of intellectual capital on the performance quality of Iranian auto part manufacturing companies. To this end, this study adopted the quantitative research approach together with the survey technique in order to collect required data from a total of 275 Iranian auto part manufacturing companies. The data gathered were subjected to analysis with the use of the structural equation modelling (SEM) on the basis of the Partial Least Squares (PLS) technique. According to obtained empirical results, intellectual capital significantly affects the organisational performance and the organisational innovation capability has a great impact on infusion of the independent factors significance. The resource-based theory can be relevantly applied to the Iranian manufacturing context; it can be also improved by various dimensions of innovation capability. From a practical perspective, Iranian auto part manufacturing companies need to be further engaged in the enhancement of their own innovation capabilities.
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