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Why is intellectual property management so often not intellectual?

Published on 19 Oct 2020 | 3 minute read

Creating, leveraging and protecting intellectual property is a key business activity for any modern company.

To be able to do so effectively, it's vital to develop and implement an organizational structure able to handle the different challenges of IP ideation, maintenance and use. It is also important to build and maintain a corporate culture that allows for and rewards innovation. Think about it as building a house; there must be strong foundations.  
Most people need others to design, build, maintain, assess the value of, and legally protect their houses. These professionals sometimes work together and sometimes apart, but there is a structure to their work, and the work is governed by laws and codes of conduct to make sure that it is done correctly. The value of the house is dependent on, among other things, the performance of these professionals. 
Houses are a physical property. Intellectual property is in some ways a different beast, but the value of IP is determined much in the same way as the value of a house. To create valuable IP, a structured approach by professionals in different fields is necessary. They need to work together and within a common framework to be able to maximize the value through creation, protection and leveraging of the asset in the business model.  
Intellectual property is not “one” thing; it is a common name for a multitude of different kinds of rights. They all require different kinds of attention, but common for all is the need for organizational support. It is important that an awareness of IP permeates the organization, and that all processes within the company are leveraged to manage the IP portfolio.  
As an example, all contractual engagements, including collaborations, should include IP and innovation protection considerations. This involves monitoring of the counterparty IP-portfolio and awareness of legal options, should litigation be necessary. It also includes active information management to make sure that all strategic information is shared in a deliberate manner and not in a “laissez faire” process. 
In all cases alternative protection strategies must be considered, such as NDAs and other contractual measures, to ensure adequate protection. When it comes to internal operations, there should be cross-functional processes in place to continuously monitor the value of proprietary IP and to consider adding/removing layers of protection to maximize business value over the life cycle of the product. If the cost to maintain a patent is higher than the benefit of reducing competitiveness in the market, there should be no place for sentimentality. 

Organizational structure is the foundation,but equally important is to make sure that the individuals occupying the gatekeeper roles within the organization are aware of the potential value of the proprietary IP. Relevant IP information must be captured, stored and shared throughout the company, and indeed with all appropriate stakeholders. This includes top management and will enable a company to put their IP portfolio in a wider perspective. Certain macro trends might increase the value of certain IP assets (and vice versa), and it is important that a company is able to swiftly assess the situation and its effect on their business.  
Individual awareness is imperative. It not only enables the company to maximize the value of its IP assets and adapt to change in the macro environment; many times it’s the sole reason the assets were “discovered” in the first place. The tacit nature of IP means that work has to be dedicated to figuring out what parts of an operation actually constitute IP. This cannot be monitored by only a few, it requires awareness in all parts of the organization and individual incentives based on innovation.  
Creating a system in which all of the above-mentioned structures are in place and work synergistically requires deliberate effort and can constitute a corporate-wide re-modelling.

The first step of any transformation is to assess the current status.

This can be done by using Rouse Sweden’s IPQuantifier, which measures a company’s IP capabilities in four dimensions: situational awareness, IP awareness, internal operational efficiency and exploitational capability. This tool provides the base for understanding why investing in IP is important, and how these investments can be carried out efficiently. The second step concerns building (or improving) the cross-functional processes needed for creating, maintaining and protecting IP. This also includes promoting a culture of innovation within all parts of the company.  

The third step is about designing procedures and methods for exploiting existing IP, and to continuously assess the value of the IP portfolio, and where the strategic benefits of this IP lie. These strategic benefits must be leveraged in the business model to provide the maximal gain to the owners. Otherwise, intellectual property is just a house without a roof. 


Thomas Randes leads our Management Consultancy team. The team’s focus is ensuring that organisations have the structure in place to identify the innovation assets they own and work with them to ensure there is control of those assets to maximise their value.

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