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Intellectual Property (IP) can provide a significant commercial advantage, but whilst most market leaders manage their IP effectively, many companies still underestimate the value of IP to their business and have no formal IP management systems.
So what should businesses do to make the most of their IP assets?
From our experience as in-house patent attorneys we suggest the following key steps to achieving effective IP management. To obtain the maximum benefit you should implement all of these steps, since they are interdependent and, as the saying goes, the whole is more than the sum of its parts.
1. Carry out an IP audit
As with most business strategies, you need to know where you are now before you can plan to get to where you want to be. An IP audit should find out the following:
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what IP exists within your business;
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what protection do you have for your IP;
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is the IP that you create being identified and used; and
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is there any IP that you need in order to operate which you do not own.
2. Draw up an IP strategy
A documented IP strategy is a more powerful tool than an informal, unwritten strategy - businesses with documented IP strategies rate their success in managing their IP more highly than those without one - so it is worth spending the time preparing one. An IP strategy should cover the following:
raising the importance of IP with employees
registration of IP
enforcement of IP
commercial exploitation of IP
management of your IP portfolio
valuation of IPidentification of third-party IP (any that you need to operate and any that you might infringe)
3. Set up an IP management group
You’re going to need someone to implement your IP strategy, so set up an IP management group. The group should include the following people:
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the CEO or other board member empowered to make decisions on behalf of the board - this person is an essential member of the management group, otherwise it will just end up as a talking shop rather than a forum for making decisions.
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CFO/company accountant - so you know if you can afford what you’re planning.
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CTO and/or a technical director - this person will be responsible for gathering new IP from your employees and bringing it to the management group for evaluation.
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IP manager - the person responsible for coordinating your IP efforts and liaising with your patent attorney.
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Your patent attorney - consider having them present at least by conference call, for the agenda items that involve them. We know we’re biased on this one, but we have personal experience of this role and can vouch for the value of input into your discussions from someone who knows the IP system.
4. Conduct an IP valuation
IP could be one of your most valuable assets, so you need to put an actual monetary amount to its value. You do it for your plant and machinery, and your IP should be no different. If you need assistance in valuing your IP we can suggest some useful software or a specialist IP valuation firm.
5. Assess the commercial options for exploiting your IP
The most obvious commercial uses of IP are protecting your products or services, and marketing your products and services. But there are many other options for exploiting your IP that you should also consider: licensing (to create revenue); cross-licensing (either as a solution to an infringement situation or as a cost-effective way to gain access to third party IP); franchising; joint ventures (an alternative way to access third party IP and/or know-how); and selling (as an alternative to licensing).
6. Set up an infringement reporting procedure
In order to maintain the competitive advantage provided by your IP you need to take action against potential infringers. To do this you need to identify, assess and act to stop any potential infringements. And because you have to be your own policeman, everyone in your business needs to know what IP you have, understand the importance of protecting it, and know what to do if they come across a potential infringer.
7. Evaluate the performance of your IP strategy
There is no point having an IP strategy if you don’t regularly assess its effectiveness, and up date it if it is not working as well as it could be. Regular valuations of your IP can, over time, help to show whether or not your IP strategy is working. Other measures of success can also be used, such as the percentage turnover generated from patented products or processes, or from products or services sold under a registered trade mark, or the percentage turnover generated by licensing or selling IP to third parties.
We can help you to implement all of these steps, through our IP Sherpa® advisory service and our associated business services, which include IP audits, setting up IP departments, drawing up IP strategies, and IP consultancy. | 
