As I revealed in my last post, the secret to successful intellectual property management is for your organization to know why it’s pursuing intellectual property protection for its innovation and brands. Knowing why you spend your hard-earned dollars on IP is the key to adding value back into the organization. Patents and trademarks are expensive. By ensuring that the organization is pursuing the right intellectual property assets, rather than going for a more is better approach, an IP manager can reduce spend and add more value to the bottom line.
Now that you know the secret to successful IP Management, it’s time tell you how to start applying it to your organization. To do this successfully, you first need to understand who needs to know why.
There are two groups within any organization that need to know why: 1) the person or department in charge of intellectual property, and 2) the organization’s management team.
The first group is obvious. At the very least, the IP manager should know why the organization is spending a lot of money to protect IP, and be able to articulate ‘why’. Who must they communicate that to? The second group, the management team.
The typical organization’s management team is concerned with one thing: the bottom line. In our case, how IP impacts that bottom line. This focus usually translates into questions about budget and IP spend. I can’t even begin to tell you how wrong this approach is.
You see, many management teams don’t understand the value of IP. They don’t view it as a business asset. Rather than balancing the amount spent on IP with the value it brings to the business, many management teams focus on the money and numbers. It’s about quantity, not quality.
In fact, many organizations set number or monetary goals for their IP Managers as well as for their R&D and engineering groups. For instance, it’s not uncommon for a company to dictate that the engineers must submit so many invention disclosures and that the IP department must file so many patent applications. Supposedly, this shows that there is innovation happening within the organization. In turn, the organization will at best divert more resources to R&D and engineering, or at the very least, maintain a consistent level of funding. What the organization usually gets with this approach are patents for the sake of increasing the numbers, not necessarily value.
But what if the management team was focused on value and quality in their IP assets? Let’s look at an example. What if the engineering group just made the next best thing since sliced bread? Management wants to know how it is going to be packaged and sold. To that end, they want to know how the patent and the trademark help in that process. This means that the person in charge of IP should be able to communicate in business terms why the IP is important to the organization’s business goal. The IP is viewed and treated as a business asset providing value to the business.
An IP Manager cannot be truly effective if the only answer he can provide is, ‘we met our goal of filing XYZ# of patents last year to the tune of $ABC’. The hit to the bottom line is obvious, but the value gained by all that IP spend is questionable. Unfortunately, the management team is often asking for just that information.
If you see the distinction between quantity and quality in your IP portfolio, you know why it’s important to know why.