Integrating intellectual capital and the balanced scorecard under turbulence: a Red Queen lens for strategic management accounting and value co-creation

Purpose – This paper clarifies the circumstances under which merging Intellectual Capital (IC) and the Balanced Scorecard (BSC) becomes helpful in enhancing strategic performance management in turbulent environments characterized by increasing value co-creation with customers and partners. Design/methodology/approach – This paper proposes an integration based on theory by combining (1) the IC perspective of narrating, visualising, and quantifying knowledge resources, and the BSC logic of strategy maps and measure cascades, and situates their complementarity in the Red Queen perspective of competition-driven learning and co-evolution. Findings – The paper contends that IC tools, under severe turbulence, tend to lead strategy formation by moulding the firm’s knowledge narrative and renewal of its capabilities, while the BSC is most useful for execution and alignment once the strategic intent stabilises. The paper shows how value co-creation magnifies the importance of relational capital and stretches measurement and control to the firm’s periphery. This paper presents an integrative framework and a few propositions for empirical testing. Originality/value – The paper contributes by (a) providing an evolutionary explanation for IC-BSC integration, (b) linking strategic management accounting to value co-creation through relational capital, and (c) specifying boundary conditions (turbulence, knowledge intensity, ecosystem embeddedness) for when IC should lead and the BSC should follow.