Posts Tagged: "Ip Strategy"

While many, if not most, enterprises have instituted, and are executing, an IP strategy of some sort, an important question should be considered: Is the IP strategy optimal, such that its execution extracts maximum value from company technology? Some corporate IP strategies may seem sound in theory, but in practice they are (a) selectively or inconsistently applied within or across projects, (b) incompatible with how teams actually work, (c) relatively narrow in how they perceive innovation, and (d) distracting to innovators and IP practitioners while consuming enormous resources. Ultimately, the return on IP investment of such strategies may be questionable. However, enterprises that periodically take a step back to reflect on their current IP strategies, and recalibrate them if appropriate, are likely to derive the greatest possible value from IP.

Invention harvesting can be leveraged in the context of active development projects to ensure that valuable project-related intellectual property (IP) is duly protected. Significantly, invention harvesting also can be leveraged outside the project context to encourage innovators to invent disruptive technologies to occupy a future, envisioned landscape, and to protect such technologies through the patenting process before others do so. Many companies are aware of the potential benefits of invention harvesting and aspire to begin or expand its use. However, unless they take concrete steps to support and nurture invention harvesting programs, their aspirations may bear limited fruit.

CEOs, CFOs, CTOs and General Counsel are typically very good at making decisions when they have the relevant information, but how often do they have the relevant information when making decisions regarding patents and innovation? Even worse, when decisions are being made the Chief Patent Counsel is frequently not even in the room.

In a survey by IQPC (International Quality and Productivity Center) 52% of corporate respondents cited failure to align business strategy with IP coverage as one of the key risks to their company’s IP assets. It’s especially shocking when you know that the “top patents,” patents that are valuable because they have a commercial value (or will in the near future) are limited to 15% of a company’s patent portfolio.

The very nature of preparing a patent strategy is something that requires both understanding of the patent laws and a healthy understanding of the business realities of evolving technologies. In order to plot a course calculated to succeed company leaders need to be cognizant of the actual business realities facing the company, not the talking points of lobbyists or those who write SEC filings or those who get paid to write press releases. Indeed, a comprehensive understanding of your own research and development, as well as where the industry is heading, is crucial when attempting to create the patent strategy that has any chance of succeeding.

The availability of information to gain insights based on what is happening to others who are similarly situated means decision makers can leverage the experiences of many when determining how best to proceed. For example, in the patent world if you file an application that gets classified in Class 705 that means you have little or no meaningful chance to obtain a commercially relevant patent. Truthfully, you have little or no chance to obtain any patent really. So what decision do you make moving forward? Are you going to continue to throw good money after bad money to wage a fight that you realistically have virtually no statistical chance to win?

The vast majority of the assets developed and owned by technology companies are intangible assets, i.e. they reside in their internal information and employees’ brain (Intellectual Capital or “IC”) and the output thereof (Intellectual Property or “IP”). It is estimated that in excess of 85% of the valuation of the NASDAQ Index companies (and of the new global wealth being created) lies in intangible assets. With smaller technology companies, this percentage is sometimes close to 100%. Nowadays, most technology based companies eventually fail or succeed in large part because of the way they handle their intellectual capital assets and convert those into strategic intellectual property assets.