Why is it critical for organizations to view IP Assets for strategic management? A simple answer for this question is “ look for ways and means to improve the bottom line (ROI) from what you have“, without making additional investments. Technological breakthrough, patents, trade secrets, intellectual property are live wire for major technology industry segments. Management needs a comprehensive strategy to deal with and promotes innovations on one end and pursuing avenues to maximize value from the garnered Intellectual Property (IP) Assets.
Traditionally, most organization’s spend their Marketing dollars on products, overlooking the untapped wealth of IP’s which have not be been productized. According to a report by Forrester Analyst, Navi Radjou – “US companies waste $1 trillion dollars annually by failing to extract the full value of their IP through partnerships“. Management executives need to look at their IP portfolio for strategic value and (re)align the business strategy. A first step in this direction is IP portfolio definition, organization and management (see Figure 1).
Adopting IP Assets strategic management and defining comprehensive IP strategy companies with large IP portfolio can get superior ROI for the IP portfolio. According to PWC report, 83% of Technology Executives say IP Management is very important. That said, what is being done to achieve / realize this?
Why IP Assets Strategic Management?
Here are some good reasons as to why strategic management of IP Assets is critical for organizational success:
- Know the costs for building the IP portfolio
- Create and Maintain Global Patent Portfolio
- Define Metrics and measures to value the IP’s
- Automation ensures that patents can now be marketed to other companies quickly.
- Provide executives to create alignment between IP creation, protection and strategy to maximize value.
- IP is the essence of value created in the company. For example, Microsoft spends about $7 billion to realize the monetization through license revenues.
- Valuation is now determined not by mere capital assets but by strategic IP assets. You can know for sure if your company is getting the most value from it’s IP’s or not.
- IP strategy provides the Roadmap to invest in those IP product families that allow business to gain better market share or value or both.
- Position you (business) to create value for stakeholders
As one Samsung executive put it – “We try to get as much value from our R&D and IP investments as we can, by aligning research with our business strategies“. Technology companies can tap huge reservoir of profit by out licensing their IP’s to other companies. Out-licensing helps in monetization and maximizing the value of IP.
Thunderbird IP Application Suite is world’s first and most comprehensive IP application suite. It identifies and manages the global patent portfolio, provision global IP cost estimation, manage In / Out licensing and measure the ROI on each IP / Patent family and provide IP 3600 analytics to the management to make informed decisions to improve the bottom line.
In a knowledge economy managing IP as strategic assets is key to ensure monetization & economic success. Those companies lacking strategic approach need to act and move faster for IP assets strategic management or loose edge to competitors. Companies need to act before it is too late!.
This article is written by Kameshwar Eranki, President & CEO of VajraSoft Inc.