• Intellectual Asset Management Fact & Fiction
• Managing Your Intellectual Assets
• Portfolio Analysis: Realizing the Value of your Intellectual Assets
• Five most common intellectual asset management mistakes companies 
• Your Intangible Assets A Time to Take Action
• Present State of Intellectual Asset Management

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In this Issue:

Key Questions:  

   What is the company getting for its Intellectual Property Budget?

Letter to Professionals

#3 Intangible Asset Driven Business Trends  

Top 14 Challenges For  Intellectual Property Professionals

Topic of the Month

   Mapping the best course for your enterprises Intellectual Property Asset Management development

   Intellectual Asset Management Strategic alignment can make a significant impact on business decisions

Future Topics

Dear Professional,

This month, I will be brief.  I heard a great quote credited to Bill Bradley, former NJ Senator, who said during his campaign “I will fix the roof when the sun is shining”.  I find that statement provocative to the business community in general and Intellectual Property professionals specifically.  Are you sitting there saying, “I am not going to make waves”, “don’t fix it if isn’t broken”, “nobody is pressuring me”,  or “lay low”.  I have heard from a variety of IP professionals that they are satisfied if they have avoided litigation, a defensive posture.  Is that how intellectual property makes your organization stronger?  What could you do to raise the consciousness of intellectual property and how do you measure your value contribution and its impact on the business drivers?  One of our beliefs is that the Intellectual Property professionals need to be proactive in using intellectual property as a business asset and making the connection to the business strategy and drivers . 

What do you think, should Intellectual Property professionals be proactive or reactive?   Are we doomed to waiting for the compelling event (“train wreck”) to make changes?   Is rain coming through the roof (e.g. infringements, lower value in negotiations, prosecution cost excesses, redundant development, etc)? Take a look at the roof, it might be a worthwhile exercise.  Please send me a note.

We look forward to your input and will try to integrate your questions and recommendations in upcoming newsletters. 

Thank you

Rob Williamson

13. Difficult to develop metrics  

14. More to-do and less resources

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Trend #3    Some industrial companies will transform partially or completely to R&D companies

¨    Companies that formerly did R&D to support their own capital investment in manufacturing will find that the real value and profit margin is in enabling other companies who make the capital investment,  Nike is a great example.

¨    The analysis will show that return on the capital invested in equipment and factory workers is negative -- while the return on the technology underlying the product or process is high.

¨    Licensing to/partnering with companies in developing nations where human capital is cheap and financial capital is subsidized will be prevalent and will dramatically increase the profitability of industrials in developed nations.

¨    Global harmonization of and respect for IP rights is a prerequisite.

 Implications

¨     There will be greater expenditures in new product development R&D and the obtaining of IP rights as the ROI for these activities continues to increase due to the competitive advantage of exclusivity. Managing intangible assets will become a critical capability for companies pursuing these higher return opportunities.

Mapping the best course for your enterprises Intellectual Asset Management (IAM) development.

 The “As Is” map

Building a solid foundation that will enable an enterprise to develop an IAM corporate process is fundamental to a successful IAM approach. This foundation starts with the mapping of the existing organizational components that relate to IAM processes. This mapping of the “As Is” state of IAM allows you to identify all parties involved with the existing approach and clarify their relationships and dependencies. It also allows the qualitative assessment of how well the process and individual components function.

The “To Be” map

With an understanding of the enterprise strategy and its key business drivers in hand the next step is to map the IAM tactics, organization, and processes that best enable the enterprise to implement its strategy. The “To Be” map utilizes the best parts of the “As Is” map as a start point.  Evaluate the best IAM practices employed successfully by the best companies in many industry segments.

A large company with a breakthrough technology in a market that it is a minor player in forms a joint venture with another company with an aging portfolio of products, and is a major player in the markets that this technology will impact. The synergies between the companies are strong. They do not presently compete heavily against each other. The company that developed the technology is able to articulate its value to its joint venture partner and negotiates a 50% ownership position substantially based on its intellectual asset contribution. The other partners’ contributions to the venture are substantially hard assets, plants, infrastructure, raw materials, etc. The joint venture was valued at about one billion dollars initially. Both companies have recognized the value opportunity of leveraging their IA’s and have aggressive enterprise strategies incorporating the concepts identified and demonstrated in this venture.

Need Served: Creating an IAM strategy alignment road map for the enterprise to better leverage its existing Intellectual Asset’s and to enable it to create new value creating Intellectual Asset’s for the future.

TYPICAL SCENARIO – If this sounds familiar, call us…

A large technology and manufacturing corporation with 12 separate business units (silos) had a significant pump design capability. This capability was not directly applicable to any of its product lines or services. The expertise and knowledge it had in pumps ran through all 12 units. Pumps, though not a product line for the corporation, were in fact similar to a product being manufactured by one of the units. Much of the same equipment and manufacturing needed to make pumps was already in place at this unit.

The corporate VP of R&D had an intuitive sense that the corporations pump competencies were world class. The pump OEMs (Original Equipment Manufacturer) continued desire to license the corporation’s amply patented technology reinforced this. The VP decided to have us (PetrashWilliamson) inventory all the pump capabilities, know how, IP, and inventors within the corporation. His intuition proved correct.

We proceeded to develop a number of business scenarios that would leverage this capability. The options developed were:

1.      Purchase a pump OEM and enhance its capabilities with the corporation’s technology and   

         design capability.

2.      Develop a joint venture with a Pump OEM.

3.      License the corporations technology to pump manufactures

4.     Do nothing and keep the technology in house and protected from OEM company and direct 

         competitors. Thus maintaining the competitive advantage in manufacturing their pump 

         technology affords them.

5.     Go into the pump business.

After a thorough assessment of the different options and on the strength of their Intellectual Assets the corporation decided to go into the pump manufacturing business. They are now one of the worlds leading pump manufactures and the Pump Business unit is the largest and most successful unit in the corporation.

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