Archive for April, 2013

Intangible Asset Fiduciary Responsibilities!

April 30th, 2013. Published under Fiduciary Responsibility, Intangible asset training for management teams.. No Comments.

Michael D. Moberly    April 30, 2013     ‘A blog where attention span matters’.

Fiduciary responsibilities include circumstances in which one individual has placed substantial trust and confidence in another to manage and safeguard money and/or property, either tangible and intangible, I might add.

A fiduciary relationship is also one in which an individual has an obligation to act for another’s benefit, be they stakeholders or stockholders, etc., in which expectations of faith and confidence are presumed.   In its most basic form, a fiduciary relationship extends to numerous instances in which one party, i.e., the beneficiary, places confidence in the another, i.e., the fiduciary, and such confidence is accepted.

A fiduciary responsibility though, generally establishes only when such ‘faith and confidence’ extended by one party, is actually accepted by the other party.  And, on somewhat of a cautionary note however, mere respect for another individual’s judgment or general trust one may have in an individuals’ character are generally deemed insufficient for creating – establishing a defensible fiduciary relationship.

Insofar as the duties – responsibilities associated with a fiduciary relationship, they include loyalty and reasonable care of the assets (again, tangible as well as intangible) entrusted to the fiduciary’s care, which I refer in the instance of intangible assets, (a.)  stewardship, (b.) oversight, and (c.) management.  Too, each of these fiduciary’s actions (responsibilities) are expected to be performed for the advantage and benefit of the beneficiary thereby creating (a.) dependence by the beneficiary, and (b.) influence by the fiduciary.

Anytime when fiduciary responsibilities regarding intangible assets are examined, two aspects must be fully considered, (1.) it is an economic fact – business reality that 80+% of most company’s value, sources of revenue,  globally lie in – directly evolve from intangible assets, and (2.)  Stone v. Ritter (2006), a Delaware court, in a very substantive way, drew attention to board – director oversight (management, stewardship) of compliance programs and company assets.  In part, the court’s decision read…

’…ensuring the board is kept apprised of and receives accurate information in a timely manner that’s sufficient to allow it and senior management to reach informed judgments about the company’s business performance and compliance with the laws…’ 

Rebecca Walker describes this decision in her paper ’Board Oversight of a Compliance Program: The Implications of Stone v. Ritter’, this particular decision as numerous experts assert, will come to be viewed (applied) less for its focus on board oversight of compliance programs per se, and more for bringing clarity to what actually constitutes ‘board oversight’ of a company’s assets, and by extension, its intangible assets.

Again, the quite clear message conveyed by Stone v. Ritter came at a time when increasing percentages of most company’s value, sources of revenue, and ‘building blocks’ for growth, profitability and innovation were evolving directly from intangible assets.  So, any declaration, judicial or otherwise, that this increasingly valuable asset class, i.e., intangible assets, now has fiduciary responsibilities attached at the board and senior management levels is indeed significant and worthy of our notice.

I respectfully add however, that the insights and strategies described here extend well beyond the minimums articulated in the Stone v. Ritter court decision.  Accommodating the spirit and intent (impact) of Stone v Ritter to the intangible asset side of any business, is certainly achievable, especially when senior management teams, including security and risk management executives, accounting, and legal counsel are engaged in amiable collaboration.

A critical key of course is that boards and senior management are well prepared to (a.) recognize what information (about intangible assets) they need, and (b.) demand the relevant and objective information regarding intangible asset asset performance (indicators) and other equally important quantifiers as the basis for identifying and objectively assessing…

  • intangible assets’ stability, defensibility,  and contributory value.
  • the various transaction contexts in which intangibles will be in play and/or elements to a transaction
  • strategies to prevent, counter, and/or mitigate risks and vulnerabilities to the assets that  extend well beyond conventional snap-shots-in-time audits or mediocre checklists to include a range of adverse events, acts, and/or circumstances that will, when materialized, impair, erode, and/or undermine the assets’ contributory value, and competitive (market space) advantages.
  • techniques for structuring business  transactions to sustain/preserve the desired levels of control, use,  ownership, and value of the (intangible) assets in both pre and post transaction contexts.
  • how to achieve greater efficiencies and profitability when (intangible) asset stewardship, oversight and management are aligned with a company’s core mission, strategic planning, financial management, and the value – functionality cycle of the assets.

Absent consistent efforts to ensure each of the above occurs, boards and senior management will fall short of the fiduciary responsibilities articulated in Stone v Ritter, i.e., to know what’s going on inside their company!

Each blog post is researched and written by me with the genuine intent it serves as a useful and respectful medium to elevate awareness and appreciation for intangible assets throughout the global business community.   Most of my posts focus on issues related to identifying, unraveling, and sustaining control, use, ownership, and monitoring asset value, materiality, and risk.  As such, my blog posts are not intended to be quick bites of  unsubstantiated commentary or information piggy-backed to other sources.

Comments regarding my blog posts are encouraged and respected. Should any reader elect to utilize all or a portion of my posts, attribution is expected and always appreciated. While visiting my blog readers are encouraged to browse other topics (posts) which may be relevant to their circumstance or business transaction.  I always welcome your inquiry at 314-440-3593 or m.moberly@kpstrat.com

 

Intangible Asset Roadmap

April 29th, 2013. Published under Intangibles as strategic assets, Managing intangible assets. No Comments.

Michael D. Moberly    April 29, 2013       ‘A blog where attention span matters’.

It’s really quite straight forward, embedded in the economic fact – business reality that increasing percentages of company value and revenue lie in – evolve directly from  intangible assets, management teams, boards, and other business decision makers, regardless of a company’s size, the location of its headquarters’, its maturation, its receptivity to being innovative and forward looking, or industry sector(s) it serves, its quite likely that a practical and viable roadmap for (a.) putting intangible assets to work, and (b.) preserving their (contributory) value and competitive advantages will be beneficial.

Such a roadmap, particularly the type that I advocate which includes ‘putting intangible assets to work’ for a company, starts, in my view, with (a.) the misnomer that intangible assets are synonymous with intellectual property, i.e., patents in particular, and (b.) re-framing the perception that the management, stewardship, and oversight of a company’s intangible assets fall exclusively to the legal and accounting domain.

Let’s be clear, most, if not all decisions and actions related to intangibles assets are and should be business decisions, preferably in collaborative concert with the c-suite, security, risk management, legal counsel, and accounting.   Too, as articulated by a Delaware court in Stone v Ritter, they can also assume a fiduciary responsibility that includes (a.) having consistent operational familiarity, and (b.) preserving their control, use, ownership and monitoring value, materiality, and risk.

Let there be no misunderstanding, the (effective) management, stewardship, and oversight of a company’s intangible assets has permanently shifted from merely being optional tasks and/or ‘nice to have’ processes, to, as noted above, something akin to fiduciary responsibilities that can no longer be dismissed or neglected, e.g., it will happen only when (a.) time permits, (b.) the resources become available, (c.) competitors are observed doing it, or (d.) a professional standard or a legislative mandate is adopted leaving businesses with few, if any options, other than compliance.

Too, the intangible asset ‘roadmap’ advocated here, dispels the really unfortunate assumption held by far too many management teams that intangible assets and their management are the sole province of large, multi-national, Fortune 1000 categories of corporations.  The reality is, intangible assets are firmly embedded in and being routinely produced by the 20+ million small, mid-size, and early-stage firms in the U.S. and no doubt, an equal number of international firms regardless of sector.  A key issue, in my view, in both circumstances, does either understand it, know it, and actually (a.) put their intangibles to work, and (b.) have processes and procedures in place to identify, unravel, assess, protect,  preserve, and monitor their intangibles’ contributory value and the competitive advantages and revenue they produce.

Most every company, with few, if any exceptions the author has had contact over the years, possesses what I refer to as ‘home grown’ (internally produced)  intangibles that are frequently highly specialized and  company specific irrespective of size, industry sector, or maturity.  In most instances, I find these assets, managerially speaking, are not well suited for one-size-fits-all or snap-shot-in-time (asset) management approaches.  Instead, they require nuanced handling aligned – commensurate with…

  • achieving the most effective and efficient use
  • maximizing their contributory-collaborative value, and
  • building and strengthening a company’s structural capital and competitive advantages throughout its supply-stakeholder value chain
  • particular types of (business) transactions.

For these reasons, I advocate practical, yet individualized intangible asset management approaches which I routinely refer to as my ’what fits best’ approach.  That is, at least my experience suggests that ’what fits best’ for a company will usually ‘work best’ for a company insofar as helping achieve business goals and objectives through its stewardship, oversight, and management of its intangible assets.

So, whether one conceives my ‘roadmap’ through a conventional sequential lens or more as a ‘big picture’ mosaic that reflects – encompasses a range of challenges fully integrated with practical insights for solving (intangible) asset management, stewardship, and oversight challenges, my message remains laser focused; business decision makers, regardless of their specialization, professional experiences, or title, need to acquire, if they haven’t already, a strong operational and managerial clarity – familiarity with intangible assets because these skill sets are essential requisites for successfully and effectively managing intangible asset dominated/intensive companies in the globally competitive, aggressive, and predatorial business transaction arena in which there are absolutely no indicators of reversal.

I respectfully recognize, just making sense of the knowledge (intangible asset) based economy and the increasingly intense business environment it has given birth to, is not sufficient unless readers can literally use and apply the information provided, that is, to frame and execute their own profitable and sustainable roadmap for their intangible assets.  That’s why the various chapters in our upcoming book will, individually and collectively, provide readers with relevant and current insights about, not just a starting point, but the practical steps that are necessary along the way to help management teams arrive at a successful, profitable, and strategically sustainable destination!

While I am a strong advocate of utilizing intangible assets as fully and completely as possible, it is not my intent to represent intangibles as constituting either a silver bullet or a one-size-fits-all template that will produce immediate financial – competitive advantage magic for a company.

I do know however, that it remains an irreversible economic fact that 80+% of most company’s value, sources of revenue, and growth potential lie in – evolve directly from intangible assets.  Thus, unless and until management teams, boards, investors, stakeholders, and other business decision makers begin demanding that (their) company’s intangible assets ‘be taken out for a ride’, those assets will likely remain idle, taken for granted, and otherwise left unused, under-valued, and vulnerable to global competitors to acquire and use at will.

Each blog post is researched and written by me with the genuine intent it serves as a useful and respectful medium to elevate awareness and appreciation for intangible assets throughout the global business community.   Most of my posts focus on issues related to identifying, unraveling, and sustaining control, use, ownership, and monitoring asset value, materiality, and risk.  As such, my blog posts are not intended to be quick bites of  unsubstantiated commentary or information piggy-backed to other sources.

Comments regarding my blog posts are encouraged and respected. Should any reader elect to utilize all or a portion of my posts, attribution is expected and always appreciated. While visiting my blog readers are encouraged to browse other topics (posts) which may be relevant to their circumstance or business transaction.  I always welcome your inquiry at 314-440-3593 or m.moberly@kpstrat.com

 

 

Intangible Assets Rapid Maturation Of Ideas!

April 26th, 2013. Published under Intangible asset focused company culture., Intangible Asset Value, Intangibles as strategic assets. No Comments.

Michael D. Moberly     April 26, 2013    ‘A blog where attention span matters’.

As noted repeatedly in this blog and by numerous intangible asset strategist colleagues, there is no other time in business governance history when, globally speaking, larger percentages, i.e., 80+%, of most company’s value, sources of revenue, and ‘building blocks’ for growth and profitability are more rooted in – evolve directly from intangible assets, i.e., intellectual property, structural, relationship, intellectual/human, and strategic capital, proprietary know how, brand, and reputation, etc.

So, today it has become an indisputable economic fact – global business reality that the primary sources of most company’s value and revenue have shifted from tangible (physical) assets, e.g., property, equipment, inventory, etc., to intangible (non-physical) assets.  In other words, the global business landscape is being less shaped and influenced by the development, production, and/or flow of physical (tangible) goods and services than it is by the flow of ideas, information, and other forms of intangible assets.

One consequence is that in today’s tightly wound and increasingly compressed transnational R&D environments, product cycles, and business transactions,  ideas can mature very rapidly as ‘value add’ and revenue producing competitive advantages or intangible assets.  But, if those assets are ineffectively managed, i.e., protected, preserved, and monitored, etc., they can easily meld into open (public domain) sources or otherwise be vulnerable to myriad forms of compromise.  The reality then becomes, once such assets enter, inadvertently or otherwise, the public – global domain, conventional intellectual property (law) protections carry little, if any deterrent affects and becomes akin to ‘the genie getting out of its bottle prematurely’.  Trying to get ‘the intangible asset genies’ back into their managerial and legal cocoon becomes a frustrating, time consuming, legally challenging, and costly experience.  Should such risks materialize, the rightful (intangible) asset holder (developer, owner) should be prepared to expect the assets to be, at best, only partially recoverable, and, at worse, irrevocably lost.

The long held American adage ‘talk is cheap’ no longer has relevance, at least in my view, in the current go fast, go hard, go global business transaction environment.  Unfortunately though, this adage remains somewhat indicative of a broader attitude which a significant percentage of business decision makers still hold regarding the value of information-based (intangible) assets.  That is, information is frequently considered to be valuable only if, or when, some specific action can be taken as a result.  In this context, it’s important to recognize that mere ‘ideas’ can mature very rapidly today, and, ‘in the right hands’ can be quickly converted to ‘contributory value and sources of revenue for a business.

Somewhat unfortunately, the consistently expanding and seemingly insatiable (nanosecond) demand for information and communication connectivity represents a growing influence about how large percentages of business decision makers conceive and use information-based assets, that is, in contexts that are primarily oriented toward short-term application versus a long term and/or strategic use and contributory value.

One result, often falling under business decision makers’ radar, influenced in part by the presumed speed in which we prefer ‘things to happen’, is that information-based assets, i.e., ideas and intellectual capital have become more than mere tools to manage other assets, they are now stand alone commodities with varying cycles of contributory value and relevance to the owners.  (Branscombe, Anne Wells. Who Owns Information? From Privacy to Public Access. Basic Books 1994)

The real ‘back story’ in my view, is that (ideas) intangible assets can advance an organization or company economically, competitively, and strategically only so long as the assets’ control, use, ownership, and contributory value is monitored and preserved.  In other words, there is effective stewardship, oversight, and management (of the assets) in place.  Similarly, it’s important to recognize that the contributory value of intangible assets and intellectual property seldom remain constant (static), rather it can change or fluctuate, sometimes quite rapidly for various reasons which is the rationale that value preservation, asset monitoring, and risk mitigation measure be sufficiently flexible to reflect the assets’ status, value cycle(s), defensibility, and sustainability.

Again, when risks to information-based intangible assets materialize, they can impact a company in many ways, e.g.,

  • undermine competitive advantages, strategic planning, new business/product rollouts, etc.
  • erode anticipated (profit) margins
  • create time consuming distractions that disrupt and/or impede a projects’ momentum,
  • entangle assets in costly and lengthy legal disputes
  • cause investors to change their exit strategies and/or deter future rounds of investment

A good thing is, more management teams are recognizing the importance, through blogs like this and those of my colleagues, of taking steps to safeguard and preserve the standalone and contributory value and competitive advantages their intangible assets produce, the more profitable and sustainable their decisions and transactions will be.  A downside is, there remain percentages of management teams who sometimes…

  • are too quick, in my view, to adopt a lawyer-law centric vs. a asset management, stewardship, and oversight approach for enforcing intangible asset rights, in part because they may be unfamiliar with their options, the broad nature of asset risks, and business – strategic needs, or
  • mistakenly assume computer/IT security is synonymous with intangible asset preservation, that is to say, all (valuable) intangible assets exist in electronic ‘bits and bytes’ formats and can be adequately protected by conventional firewalls and passwords.
  • mistakenly assume intangible asset safeguards will impede the flow and accessibility of intangible (information) assets necessary for business operation minimums.
  • mistakenly place too much trust and faith in all employees, business partners, and others who have knowledge and/or access to their company’s intangible assets or ‘crown operating – profit making jewels’.

It remains essential then, that decision makers have a clear understanding where the value of their firm, which they have fiduciary responsibilities, lie and the form and context which that value manifests itself, i.e., intangible assets, competitive advantages, intellectual capital, etc., and ultimately perhaps, as intellectual property.

Though frequently characterized as being cliché, the emergence of the still relatively new global business economy dominated by intangible, rather than tangible assets, is prompting increasing numbers of business decision makers and boards to rethink the way they make decisions, manage, and value their companies and the intangible assets they produce and/or acquire.

What’s exactly ‘new’ about the new (knowledge – intangible asset dominated global) economies remains somewhat debatable, say’s Dr. Baruch Lev of New York University. But, one important feature about the 21st century is crystal clear, he confirms, intangible assets are playing an increasingly important and integral role in most company’s value and wealth creation potential.

Lev goes on to say that economic activity today consists increasingly of exchanges of ideas, information, expertise, and know how, which are, of course, intangible assets.  Thus, company profitability is more often driven by its collective competencies and capabilities (again, intangible assets) than by control over or use of physical resources or tangible assets.

Each blog post is researched and written by me with the genuine intent it serves as a useful and respectful medium to elevate awareness and appreciation for intangible assets throughout the global business community.   Most of my posts focus on issues related to identifying, unraveling, and sustaining control, use, ownership, and monitoring asset value, materiality, and risk.  As such, my blog posts are not intended to be quick bites of  unsubstantiated commentary or information piggy-backed to other sources.  Comments regarding my blog posts are encouraged and respected. Should any reader elect to utilize all or a portion of my posts, attribution is expected and always appreciated. While visiting my blog readers are encouraged to browse other topics (posts) which may be relevant to their circumstance or business transaction.  I always welcome your inquiry at 314-440-3593 or m.moberly@kpstrat.com

 

Pre-Employment Screening Reversal Theory

April 25th, 2013. Published under Insider Theft of IP and Intangible Assets, Insider Threats. No Comments.

Michael D. Moberly   April 25, 2013    ‘A blog where attention span matters’.

In the Spring/Summer 2012 edition of the International Journal of Intelligence Ethics, the author of ‘Reversal Theory: Understanding the Motivational Styles of Espionage’ brought some very worthy and intriguing context to the relationship between insiders and economic espionage by way of ‘reversal theory’.

In the article, an obviously experienced and certainly forward looking author distinctively applied Dr. Michael J. Apter’s ‘reversal theory’ to the persistent – ever present challenge of insiders relative to their predilection to engage in insider theft and/or economic espionage at some point during their employment.

In short, reversal theory (RT) as well described in the aforementioned article is a model for personality analysis. The premise is that people and their behavior change, perhaps regularly, overtime.  In other words, people’s motivational states are not static, rather they’re quite dynamic.  As such, behaviors people may engage in to obtain, presumably personal satisfaction, are also dynamic and certainly not static.

More specifically, RT suggests one’s personality evolves from – is embedded in patterns of (dynamic) change, not ‘fixed traits’ which some psychometric practitioners and researchers continue to advocate.  The notion that there are particular ‘fixed (permanent) traits’ that people possess that in turn are associated with – linked to ‘predictable patterns of behavior’ is contrary to the principles of the RT model.

Put another way, as the author points out so effectively, is that RT actually ‘challenges the assumption that (fixed) personality traits or commonalities of behavior’ are linked to predictability.  Again, the author points out that RT, if practiced correctly, would allow more organizations to screen out vulnerable and/or suspect applicants.  But, my reality is, and I suspect the author may agree, continued reliance on conventional trait (employment screening) approaches have not produced the necessary consistency in identifying – distinguishing applicants who are vulnerable or otherwise, at some point in their employment tenure become receptive to engaging in adverse acts against their employer.  In this instance, we’re talking about theft, misappropriation, and/or infringement of intellectual properties, proprietary (trade secret) information and other forms of intangible assets.

More specifically, both the and Dr. Apter agree that the conventional ‘static trait theory’ has not, and does not account for, nor does it address the very real reality that people are receptive to behavioral – attitudinal changes over time, some of which adversely affects their receptivity, propensity, and proclivity to ‘voluntarily’ engage in insider theft and economic espionage.

As most practitioners serving in the arena of endeavoring to thwart insider threats and economic espionage know all too well, there are myriad of anecdotal accountings and well intentioned studies identifying gradations, motives, tenacity, and intensity of the risks posed by ‘insiders’.

Unfortunately, the same challenges remain, if not become intensified, with of course the proverbial tweaks and/or technological variations insofar as how targeted assets are accessed and acquired by bad actors.  What’s needed in my judgment, as has been noted multiple times in this blog, is that objective, replicable, and evidence-based research, beyond mere anecdotal reports or accountings, that present different, but certainly plausible explanations why particular employees, post hiring, willingly and voluntarily become ‘insiders’ and variously engage in economic espionage.

Through my lens, and the publication of well researched articles as summarized here, the private sector, as well as the intelligence community, are now absolutely obliged, more than ever before, to re-visit and re-think their personnel (pre-employment) screening processes and practices by, among other things, recognizing that periodic (in-employment) re-assessment is essential. At minimum, periodic re-assessment should include the means to identify and assess post-hires’ adverse (a.) receptivity, (b.) inclination, and/or (c.) newly acquired predispositions that may or may not have evolved since and be contrary to what was gleaned on or before the date-of-hire while having access to classified (proprietary, sensitive)  information, i.e., intangible assets.

I should think, in part, the author’s application of reversal theory as aptly described in this article certainly warrants broad attention and study because it serves as a very worthy starting point for some serious and thoughtful discussion on this increasingly critical matter.

Of course, the necessity for the private sector to comprehensively address risks posed by insiders is elevated in large part because of the economic fact – business reality that 80+% of most company’s value, sources of revenue, and ‘building blocks’ for growth, profitability, and sustainability lie in – directly evolve from often times readily available, perhaps even open source, intangible assets, many of which are rooted in – emanate from intellectual properties, proprietary information, and other forms of intellectual, structural, and relationship capital.  As for the application of RT to government agencies, one hardly needs to say more than PFC Bradley Manning!

This globally universal economic fact alone should, in my view, and I suspect that of the author as well, should prompt companies and organizations to find the will and the resources necessary to effectively mitigate insider risks and economic espionage, be it state sponsored or conducted by independent actors. In other words, RT theory, in my view, warrants attention and thorough discussion!

Inspiration for this post lies with an article published in the Spring/Summer 2012 edition of the International Journal of Intelligence Ethics, titled ‘Reversal Theory: Understanding the Motivational Styles of Espionage’.

Each blog post is researched and written by me with the genuine intent it serves as a useful and respectful medium to elevate awareness and appreciation for intangible assets throughout the global business community.   Most of my posts focus on issues related to identifying, unraveling, and sustaining control, use, ownership, and monitoring asset value, materiality, and risk.  As such, my blog posts are not intended to be quick bites of  unsubstantiated commentary or information piggy-backed to other sources.  Comments regarding my blog posts are encouraged and respected. Should any reader elect to utilize all or a portion of my posts, attribution is expected and always appreciated. While visiting my blog readers are encouraged to browse other topics (posts) which may be relevant to their circumstance or business transaction.  I always welcome your inquiry at 314-440-3593 or m.moberly@kpstrat.com

Intangible Asset Strategists and Consultants

April 3rd, 2013. Published under Intangible asset strategy. No Comments.

Michael D. Moberly    April 3, 2013    ‘A blog where attention span matters’.

Let’s accept the following as economic fact; we live, work, and conduct business transactions in an increasingly and irreversible knowledge-based global economy, where 70+% of most company’s value, sources of revenue, and ‘building blocks’ for growth, sustainability, and profitability lie in – directly evolve from intangible assets!

Equally importantly, let’s also accept the business reality that the aforementioned economic fact has yet to become so self-intuitive to management teams, c-suites, and boards that they will instinctively recognize the necessity to engage in strong and consistent stewardship, oversight, and management of the intangible assets their company produces and/or acquires.

This makes all the more essential for intangible asset consultants and strategists to develop an understandable script, if you will, to help clients understand the various ways their company can elevate its value, add sources of revenue, and solidify its sustainability through better utilization of its intangible assets.  This can occur not just by recognizing intangibles assets and their relevance to business profitability and market space, but by taking affirmative steps to enhance, position, bundle, and exploit intangibles.

Developing such a script, according to Dale Furtwengler, an extraordinarily intuitive St Louis-based business strategist and author of ‘Pricing for Profit: How To Command Higher Prices For Your Products and Services’, is a critical component to increasing the probability business clients will pay a premium for effective outside counsel, i.e., intangible asset strategists’, that lead to practical, tactical, and strategic clarity insofar as identifying, unraveling, enhancing, positioning, exploiting, and managing intangible assets.

Thus, the more clarity decision makers achieve from consultants and strategists regarding intangible assets their company produces or acquires and are inevitably embedded in the products and/or services they produce will (a.) lead to better – more informed decisions about the necessity to engage an intangible asset strategist, and (b.) reduce the probability that particular buying decision will be postponed.

For that to occur however, a strategists – consultants ‘script’, Mr. Furtwengler argues, and I agree, must clearly and convincingly articulate how to calculate the monetary value of the intrinsic value which a consultants’ services and/or offerings will actually provide. The premise is, clients will pay a premium for value they understand and can rapidly apply.

Usually, Mr. Furtwengler points out, when prospective buyers (of intangible asset strategists’ services, for example) find themselves unable to distinguish one strategist’s services/offerings from others, they ask about pricing.  That, of course often translates as an inability to quantify the value of what may appear, to prospective clients, as competing services and/or offerings because, rather unfortunately, pricing (fees) tends to be the primary form of measurement business decision makers understand insofar as distinguishing competing offerings – services.

Furtwengler effectively argues throughout his book that client’s expect to pay more to get more, but only, if ‘getting more’ has (recognizable and actionable) value to them.  So, an intangible asset strategists’ ability to command higher fees lies solely with their ability to articulate (i.e., their script) that greater value, and how to monetize that greater value to benefit clients and their respective needs.

That said, Furtwengler recognizes that independent consultants/strategists site numerous reasons and/or rationales why they are resistant to raising their fees – prices, i.e.,

  • they don’t possess the brand/name awareness of larger (competing) full service consulting firms.
  • their clients only express concern – care about pricing/fees.
  • our competitors won’t raise their fees – prices, so we can’t.
  • we will lose sales and market share if we raise our fees.

As a counter to those ill-fated rationales, Furtwengler describes six ‘value propositions’ which are what prospective buyers of consulting services really value which I have extrapolated to intangible asset strategists and consultants, i.e.,

  1. Innovative Image…that will accrue by purchasing intangible asset services that represent a buyer’s desire to elevate their (company) image by being associated with and being able to purchase such specialized ‘leading edge’ services.
  2. Integrity…reduces the amount of time required for a prospective client to make a buying decision when they’re sure the consultant/strategist is trustworthy?
  3. Service and Dependability…do it right the first time so clients do not lose time later for expensive remediation or complete do-overs.
  4. Knowledgeable spokespersons…can also constitute time savings, i.e., a consultant/strategist who knows their services extremely well and can clearly and understandably articulate those services on a ‘what fits best basis’ to help prospective clients recognize what they really want, need and value.
  5. Speed and Convenience…time savings and quick service.
  6. Friendliness…a genuinely friendly image conveyed to prospective clients.

I applaud Furtwengler for not even including in his book the conventional practice of framing service ‘pitches’ that emphasize fear, uncertainty, and doubt (FUD).  For some intangible asset consultants and strategists, it’s difficult to resist utilizing – resorting to FUD factors, especially when a prospective client expresses a dismissive attitude about ‘all things intangible’.

If intangible asset strategists – consultants commence an engagement meeting with a strong narrative (script) that is not reliant on highly subjective FUD elements, and instead, includes a…

  • forward looking focus on the importance of providing strong methodologies for…

the stewardship, oversight, and management of intangible assets, and

  • sustaining control, use, ownership, and monitoring (asset) value, materiality, sustainability, and risk

…the probability of experiencing consistent enterprise-wide success increases substantially!

Each blog post is researched and written by me with the genuine intent they serve as a useful and respectful medium to elevate awareness and appreciation for intangible assets throughout the global business community.   Most of my posts focus on issues related to identifying, unraveling, and sustaining control, use, ownership, and monitoring asset value, materiality, and risk.  As such, my blog posts are not intended to be quick bites of information piggy-backed to other sources, or unsubstantiated commentary.  Comments regarding my blog posts are encouraged and respected. Should any reader elect to utilize all or a portion of any of my posts, attribution is expected and always appreciated. While visiting my blog readers are encouraged to browse other topics (posts) which may be relevant to their circumstance or business transaction.  I always welcome your inquiry at 314-440-3593 or m.moberly@kpstrat.com