Archive for 'Managing intangible assets'
Michael D. Moberly February 13, 2017 A business blog about intangible assets where attention span really matters!
Business acumen acquired from – retained through personal experience permits most of us to ‘encode’ repetitive activities and processes (we engage in) as habits, which, in turn, allows us to free up ‘brain space’ to learn new things. This encoding process is referred to as habituation.
Habituation however, may not always translate – manifest as (business) improvements, new practices, or creating much needed efficiencies. Instead, in its extreme, ‘habituation’ that manifests as unquestioned adherence – attachment to perpetuating past practice and/or convention, without considering some may be variously obsolete, nearing irrelevance, or wholly uncompetitive, can, quite literally, push economic realities, ala IA’s, off ‘the proverbial table’ and strategic planning radar screens to be obstructions to business competitiveness, sustainability, and viable paths to creating value and (new, additional) sources of revenue.
When one recognizes how to differentiate habitual (sometimes trivial) details from those which are genuinely relevant, competitive, and value-revenue creating, ala IA-related, vs. merely continuing to approach-execute certain practices and/or processes because ‘we have always done it this way’ (with no intent-desire to change) is habituation, perhaps in its most extreme form.
There are many good and relevant reasons why we (our brains, personalities) are receptive to habituation. One is, if habituation were absent, proponents would argue we would likely be destined to consistently taking notice of and acting on relatively inconsequential minutia – details of work. Doing so would likely impede, if not limit our work effectiveness and efficiency. That’s because, presumably it would leave little time or inclination to notice or learn new things, i.e., change that could favorably affect the way we approach, engage, execute (our) work-job.
A relevant, all-be-it comedic example of this is (comedian) Jerry Seinfeld’s career which his followers recognize has largely been built on making light of the supercilious minutia of life behaviors and processes which most of us accept and comply with as mere unquestioned realities, i.e., this is the way someone decided it should be done, and it may never rise to a level that prompts us to question why!
Yes, it’s a generalization, but, many successful business persons, are often ‘wired’ to not just notice changes in habits, life expectations, and tolerance, and re-cast them in question contexts, i.e., ‘what could be’? For example, ask, what product-service could be developed, reconfigured, modified, etc., to ‘scratch an itch’ affecting significant and diverse percentages of populations, how much will it cost to produce and market, how quickly can it be brought to market, and what are the risks of doing so, and, if so, what, when, where, and how will they materialize?
These, so-called ‘wired’ individuals, often go multiple steps insofar as anticipating, seeking, embracing, and internalizing change, and how to translate same to develop, monetize, and commercialize discoveries, technologies, and products, embedded with IA’s, often, long before it materializes in a Jerry Seinfeld comedy sketch. Wired individuals are inclined to recognize-distinguish ‘benefits and beneficiaries’ in futuristic contexts vs. recognizing its existence and affects after the fact.
In one sense, this-is-why I frequently characterize my work, as strangely as this may appear to some, as consistently viewing business-company operability through an intangible asset lens. More specifically, during engagements, I respectfully examine actions and perspectives conveyed by business leadership and company management teams in the context of how, why, where, when, and circumstances in which (their) IA’s are used – leveraged (or, not) and how either impacts or contributes to a specific outcome favorably or unfavorably.
It’s not particularly challenging, I find, for business pundits to equate (critique) a company’s missteps or miscues subjectively as missed opportunities. On the other hand, it’s substantially more challenging to correctly define and collaboratively resolve challenges – risks related to business value, sources of revenue, competitive advantages, and reputation that originate – are embedded in non-physical (intangible) assets, which, irrespective of their contributory value, are seldom, if ever, mentioned.
So, when I am engaged with-by clients and companies about their IA’s, i.e., to facilitate-enable lucrative and competitive treatments-applications, I recognize, respectfully so, there have likely been multiple and various circumstances arise previously that singularly or collectively elevated awareness and importance of particular-IA’s. When this occurs, it allows those experiencing – achieving IA operational familiarity, substantially and operationally, better positioned to recognize-examine their IA circumstances to determine if such preludes were and remain present, i.e., determine-assess if, when, where, and how IA’s are being acknowledged and utilized effectively, lucratively, and competitively.
Why am I addressing this? It’s because forward looking-thinking business leaders and management teams are becoming more adept at recognizing – distinguishing processes, initiatives, risk, transactions, and challenges, etc., through IA lens, all-be-it often filtered through conventional sense of (tangible asset) physicality. In the pre-knowledge worker era, obviously previous-to recognizing IA’s contributory role and value to businesses and companies, it was largely assumed that innovation, transaction success, mitigating risks, and/or resolving challenges could be accomplished by simpler (physical) techniques, e.g., deciding which knobs needed adjusting, which screws needed tightening, or which moving parts needed lubrication, etc. In other words, physical methodologies were routinely attached to both the execution and resolution side.
Today, however, it’s a globally universal economic fact that 80+% of most company’s value (sources of revenue, competitive advantage, etc.) lie in – evolve directly from IA’s. A logical extension of this economic fact is that the value and/or pricing of a transaction is reflected in the IA’s in play. This has relevance on several levels, perhaps the most significant is the necessity for business leadership – management teams to recognize the intangible (invisible – non-physical) elements in value, competitiveness, and sustainability, etc., and address them accordingly. (The above was substantially modified by Michael D. Moberly from Tony Fadel’s, March 2015, TEDTalk titled ‘The first secret of design, is noticing’.)
Michael D. Moberly November 12, 2016 ‘A blog where intangible assets meet business’!
1. Align IA development and use with a company’s strategic planning and core (business) mission and product/service lines.
2. Foster a company-wide IA culture that facilitates asset monitoring and more timely awareness of misappropriation, competitive advantage undermining, and asset value dilution.
3. Forge stronger relationships with legal counsel, auditors, and accountants on all matters related to intangibles and non-financials.
4. Strengthen convergence with knowledge management programs and balanced scorecard initiatives
5. Kick start company-wide strategic planning to achieve fuller utilization, accounting, and value from IA’s.
6. More efficient and effective use of legal counsel and IT resources…
7. Facilitate alignment of financial – risk management planning with asset monitoring, safeguards, and monitoring core strategic objectives that contribute to assessing performance of IA’s.
8. Bring consistency to business accounting and auditing by describing IA’s in revenue conversion – competitive advantage contexts.
9. Provide foundation for developing business continuity and contingency (organizational resilience) planning specific to IA’s to achieve quicker and more complete economic recovery following catastrophic events.
10. Elevate company’s stature and goodwill (reputation) among its customers, suppliers, and investors and gain attention of audiences well beyond a company’s traditional market space.
11. Identify ‘leverage points’ in negotiating IA insurance coverage and premiums…
Michael D. Moberly July 28, 2016 ‘A blog that intersects intangible assets with business’!
As I have endeavored to convey since my initial post to this blog in mid-2006; the importance for business decision makers to recognize that, in each transaction they engage, correctly identifying, assessing, and mitigating risk to the IA’s (intangible assets) which play increasingly significant roles insofar as being consistently positioned to achieve the projected and sustainable outcomes!
The reason, steadily rising percentages (80+%) of most transactions’ value, projected sources of revenue, future wealth creation and competitiveness reside in – evolve from IA’s. That’s an objective and replicated economic fact, not business cliché or hyperbole. So, when business transaction management (M&A, due diligence) teams, etc., overlook, or elect to dismiss and relegate relevant IA’s, for whatever reason, i.e., IA’s not routinely reported – integrated in balance sheets or financial statement, it’s tantamount, in my judgment, to ignoring how/where value is created, revenue is generated, and sound strategic planning should originate.
In growing numbers of instances, engaging, identifying, assessing, valuing, and mitigating risks to IA’s most relevant to a transactions’ and/or operations’ projected and presumably lucrative outcome rises to a fiduciary responsibility ala Stone v. Ritter.
For decision makers, the implications are clear; an immediate charge to themselves and their transaction management team is to determine if IA’s are being correctly incorporated – addressed in the various tasks, i.e., due diligence, asset inventory, audit, and valuation, etc. Should decision makers find their transaction teams are doing neither, it’s fair to suggest achieving operational familiarity with business’s IA’s by sector and type of (reason for initiating a) transaction, would be a prudent undertaking and would produce revelatory insights that can be immediately applied to further transaction negotiations, i.e., mitigating risks by ensuring ownership, control, use, and value – competitive advantages of the relevant IA’s will be sustained.
As regular readers of this blog know, there is an abundance of business economic research (NYU’s Stearns School of Business, The Brookings Institute, and key UK universities) that consistently paint convincing and objective portraits about the that if and/or when a merger, acquisition, or other type of transaction ‘goes south’, evidence of impending problems and challenges will surface quite early and will likely stem from one or more intangible assets.
Each parties’ transaction management-oversight team is variously obliged to work collaboratively to reveal, unravel, and assess contributory relevance and value of IA’s. The reason, IA’s routinely and variously embedded and interact on multiple levels within an enterprise. In other words, IA’s (particularly intellectual, relationship, structural, and competitive capital) will very likely apply to multiple business – operational activities, initiatives, and projects. However, IA’s contributory role and value to routine business operations and/or a specific transaction can – will – may fluctuate, sometimes quite rapidly and not always for the better.
A technique I developed to determine and potentially remediate adverse (IA) fluctuations in a timely manner, relative to their dominant contributory role and value in transactions in a timely manner is to ensure an ‘IA transaction impact analysis’ is fully integrated into the (transaction) due diligence process in both pre and post contexts. As information derived from the (transaction impact) analysis is communicated to decision makers, a more definitive portrait of projected outcomes will arise, particularly materialization of risks which can adversely affect one or more of the IA’s in play.
The rationale for incorporating an IA transaction impact analysis for M&A’s and other types of business transactions is to better position decision makers to identify – become aware of risk circumstances – scenarios which, if they materialize, may impair or otherwise adversely affect the transaction via the IA’s in play.
I advocate IA ‘transaction impact analysis’ to focus primarily on what I find to be the three challenging IA’s to sustain – preserve their (projected, assessed) contributory role and value, particularly post-transaction, i.e., intellectual, relationship, and structural capital.
Transaction management team members undertaking – engaging in the ‘impact analysis’ are obliged to possess strong operational familiarity with (IA) risk mitigation and containment, i.e.,
• to recognize the inter-relatedness of IA’s insofar as their contributory role, value, and associated risks.
• how IA’s can become impaired, misappropriated, infringed and vulnerable to risk.
• to assess the probability that particular risks can-will materialize.
• how specific risks can adversely affect projected economics, competitive advantages, and/or synergies of a
• to assess the resiliency and sustainability of key IA’s.
Equally important, this ‘transaction impact analysis’ can reveal a range of risk circumstances/scenarios for decision maker consideration while retaining options to proceed with…
• viable plans for risk mitigation, as well as,
• aspects which re-negotiation may be warranted in light of the now known risk(s) and/or asset impairment(s).
The objective remains the same…to facilitate more secure, profitable, and sustainable transactions going forward, not impede them.
July 25th, 2016. Published under Intangibles as strategic assets, Managing intangible assets, Organizational resilience and business continuity/conti. No Comments.
Michael D. Moberly July 25, 2016 ‘A business blog where attention span really matters’!
The word ‘multiplier’, as I have observed its application, has been primarily in military – combat contexts as force multipliers. Observation and strike capable drones for example, are force multipliers because of the operational – observational advantages they provide to various military units needing real time intelligence and possibly offensive action.
However, on the business side, as an IA (intangible asset) strategist and risk specialist, I consider a company’s IA’s as representing a distinctive form/context of business multipliers. Throughout the private sector, IA’s, originate in – arise from valuable intellectual, structural, relationship, and competitive capital or, IA’s.
Preferably, business c-suites and their management teams recognize how IA’s translate, convert, or monetize as competitive tactics, processes, and/or commodities to (collectively – collaboratively) ‘multiply’ – contribute to the effectiveness, efficiency, output, revenue, and/or value of a particular operating group, project, or process.
Either way, when IA’s are acknowledged and effectively integrated in a particular initiative, project, or even organization-wide, they can, and frequently do, favorably impact efficiency, effectiveness, and productivity, which translates as value, sources of revenue, and competitiveness, that otherwise may not have been acknowledged. That’s particularly evident in business environments in which there is little or no receptivity to IA’s either in terms of their usefulness, accounting, internal development, external acquisition, or maturation – conversion often due to a misperception that doing so would disrupt the status quo or create new risk.
IA-based multipliers, also refer to attributes or combinations of competitive inputs which again, often manifest most favorably when collectively-collaboratively drawn from existing intellectual, structural, relationship, and competitive capital. A general example where this has occurred is the package delivery sector as most firms recognized the obvious efficiencies which could accrue by integrating – coordinating both GPS (global positioning) and RFID (radio frequency identification) technologies which converted to growth in value, competitive advantage, and revenue generation capability. Standing alone, both GPS and RFID are tangible-physical assets (technologies), but the intellectual, relationship, structural, and competitive capital which together recognized – linked their application to the global package delivery sector should not be dismissed.
In this instance, GPS and RFID deliverables largely manifest as contributory and competitive IA’s that facilitate-enable the package delivery sector to receive, process, sort, and deliver substantially more orders and packages more efficiently compared to competitors that have yet to incorporate those multipliers.
For those operationally familiar with IA’s, i.e., their origins, development, and integration, in most instances, can (and should) also be leveraged – exploited as, among other things, value proposition multipliers, which in turn, confer credibility and rationale to capital outlays to pursue, purchase, and integrate the multipliers, ala GPS and RFID systems, while recognizing the various IA’s such multipliers produce and strengthen.
So, as more operational clarity is brought to IA’s contributory role and value as multipliers, organization c-suites, boards, and management teams will recognize – materialize as…
• expansions of operational prerogatives and boundaries that correlate with IA development, utilization, and
• decision – transaction outcomes becoming more predictable and lucrative whenever, however, and wherever,
IA’s are in play.
• the necessity for OR (organizational resilience) planning to facilitate quicker and more complete economic-
competitive advantage recovery following a significant business disruption or materialization of reputation
Michael D. Moberly April 12, 2016 ‘A blog where attention span really matters’!
It is an economic fact that the primary sources of company value, revenue, and competitiveness, etc., began noticeably shifting in the mid-to-late 1990’s.…
• from tangible (physical) assets, e.g., property, equipment, inventory, etc.,
• to intangible (non-physical) assets, e.g., reputation, brand, and goodwill particularly.
This recognition coincided with the descriptive transformational expression ‘knowledge-based economies’ wherein learned economists calculated 80+% of most company’s value, sources of revenue, competitive advantage, and ‘building blocks’ for growth, profitability, and sustainability now lie in – evolve directly from organizations intellectual, relationship, structural, and competitive capital as well as other forms – manifestations of IA’s
My work is a culmination of 25+ years of professional consulting, university teaching, continuous research, public speaking, and publishing on matters variously related to IA’s and their intellectual property cousin. My consulting engagements, media appearances, and research in the IA arena have largely focused on…
• identifying, assessing, safeguarding, and mitigating risk.
• conducting transaction due diligence when IA’s are in play, which they consistently are, and
• facilitating company cultures prudently linked to operational familiarity with IA’s contributory role and value.
The centerpieces of my work, writing, and consulting today lie in IA advocacy, i.e.,
• value-revenue-competitive advantage capabilities of IA’s.
• identifying, unraveling, and assessing IA’s contributory and collaborative value roles for companies.
• recognizing IA’s life, value, and functionality life cycle.
• aligning IA risk assessments with transaction due diligence.
Today, profitable business operations and transactions are increasingly dependent on management team’s ability to effectively and consistently foster, harness, utilize, and convert its IA’s into relevant forms of value, revenue, competitive advantage, and sustainability.
But, knowhow, i.e., intellectual, structural, relationship, and competitive capital (IA’s) can deliver economic and competitive advantages only if/when the developer-holder of those assets can sustain their control, use, and ownership, and monitor their value and materiality throughout their respective value – functionality cycle.
Michael D. Moberly January 12, 2016 ‘A business blog where attention span really matters’.
Since I began researching, publishing, conducting seminars, and consulting…20+ years ago on various aspects of IA’s (intangible assets), I have encountered many management team members who, on the surface at least, express satisfaction in assuming their organization still functions nicely thank you on practices rooted in the pre-IA era.
I suspect in many instances, what practitioners are exhibiting is a reluctance to engage their IA’s due, I have learned, to a application unfamiliarity which in turn triggers concerns that doing so…
- may exceed their current experiential comfort.
- would be too disruptive (time consuming, costly) to current organizational operating culture.
- can deliver/produce returns unfamiliar to conventional conversion.
- is conventionally thought to be ineffectual because IA’s are seldom, if ever, reported on balance sheets or financial statements.
Unfortunately, company – organization leadership who sustain such dismissive indifference to (uncurious about) their IA’s will seldom, if ever, be positioned to capture and exploit their value, sources of revenue, and/or competitive advantages which frequently I find is ‘readily available for the asking’ in their existing operating culture. Fortunately, I find only the most intractable few management team members will sustain such dismissive positions following my respectful and clarifying discussion. Or perhaps, they learn a competitor’s market advances are attributable to recognizing and engaging their IA’s!
Mr. Moberly is an intangible asset strategist and risk specialist and author of ‘Safeguarding Intangible Assets’ published by Elsevier in 2014, email@example.com
Michael D. Moberly January 5, 2016 ‘A business blog where attention span really matters’.
I am an advocate, avid listener, and sustaining member-supporter of the NPR (National Public Radio) station in my city. This admission aside, it’s quite correct, in my judgment, to characterize NPR, and its comparables and collaboratives, i.e., American Public Media, Public Radio International, and Public Radio Exchange, etc., as IA (intangible asset) intensive and dependent organizations.
Readers are respectfully obliged to acknowledge that IA (intangible asset) intensity and dependence are not the exclusive domain of private sector, Fortune-ranked corporations, ala Silicon Valley research based startups. Instead, companies, organizations, and their management teams who wish to capture and exploit their IA intensity-dependency should recognize it emanates from the convergence of intellectual, structural, relationship, trust, reputation, and creative capital relative to organization culture and mission variants, to create – enhance value, for example…
- IA intensive…translates as a high percentage (80+%) of public radio station’s value and impact to its communities of listeners and contributors lie in – evolve directly from the formatting and delivery of its IA’s.
- IA dependent…means that public radio’s daily array of attractive-desirable programming is reliant on a…
- consistent influx and integration of intellectual, structural, competitive, and relationship capital, ala IA’s…
- that collectively and collaboratively attract and sustain broad communities of (national, international) listeners, a percentage of which…
- convert to enhancing and sustaining communities of listeners, memberships, contributions, sponsorships, and corporate-foundation underwriters.
- consistent influx and integration of intellectual, structural, competitive, and relationship capital, ala IA’s…
Public radio seems to enjoy the benefits of a continuous and evolving supply of ‘people assets’ who can seamlessly and collaboratively deliver forward looking – thinking variants of their intellectual, structural, and creative capital which inevitably meld into communities of listeners’ ears via expanding platforms. It is for these reasons that I am confident public radio station’s value, when factored through an IA lens, would lie consistently north of the 80+% figure referenced above.
Client organizations and/or seminar attendees of mine who achieve familiarity with and interest in IA’s, frequently ask me to identify which IA’s their organization – company intensity and dependency are most reliant. The answers to these questions are best addressed through an ‘IA mapping’ exercise I developed which identifies paths-routes that describe when, where, and how IA value and competitive advantage originate, develop, attach, collaborate, and ultimately flow.
I generally endeavor to dissuade organizations and their management teams from using some of the more conventional methodologies that are dismissive of intangibles or merely provide a ‘snap shot in time’ (portrait) of IA’s contributory – collaborative role and status absent recognition of value. The ‘IA mapping’ methodology, which I continually endeavor to refine, acknowledges that the contributory and collaborative aspects underlying IA value, competitive advantage, and materiality is seldom static, rather evolves to accommodate any shifts to an organization’s mission, technology delivery formats, or other issues of the day, etc.
Public radio’s IA asset intensity and dependency also correlates to trust and relationship capital and reputation. Sustaining and banking each category/type of IA with communities of listeners, supporters, and underwriters warrant consistent stewardship particularly in markets where other media-journalistic outlets compete.
Mr. Moberly is an intangible asset strategist and risk specialist and author of ‘Safeguarding Intangible Assets’ published by Elsevier in 2014, firstname.lastname@example.org
Michael D. Moberly January 4, 2016 ‘A business blog where attention span really matters’.
If it can’t be measured, perhaps, just perhaps, it can’t be managed either! An adage which I have taken some liberties is widely attributed to Peter Drucker. In my view, it carries more relevance today than when it was initially uttered. My rationale for saying this is rooted in the economic fact that increasing percentages, 80+%, of company/organization value, sources of revenue, competitiveness, sustainability and growth lie in – evolve directly from IA’s (intangible assets).
Rooted in my experiences as an IA strategist and risk specialist, I believe most all IA’s evolve from company-organization mission and culture variations of intellectual, relationship, and structural capital. Optimally, these assets meld together to serve as foundations for, among other things, sustaining and enhancing company-organization value, brand, reputation, goodwill, competitiveness, growth, profitability, and specialized know how, etc. Simply put, there are few other occasions in company – organization governance history when measuring the performance of and managing (inventorying) the contributory – collaborative role, value, and materiality of IA’s has become more necessary, i.e., akin to fiduciary responsibilities (ala Stone v. Ritter).
Materiality in this context translates as monitoring – assessing each asset’s role and contributory value throughout its respective ‘life – value cycle’, i.e., contribution to a particular project, process, and/or initiative.
The benefits – returns for IA inventories, among other things, is ensuring decision makers are consistently positioned to recognize, in a timely manner…
- any changes in assets contributory value-materiality including obsolescence.
- opportunities to sell, barter, safeguard, mitigate risk, seek collaborations, or discard non-contributing IA’s.
But, an inventory of a company’s – organization’s IA’s must be much more than a mere snap-shot-in-time reference point. Instead, it’s economically – competitively prudent to seamlessly integrate IA inventories as routine fixtures to company – organization sustainability. Absent that, IA value and materiality is known to fluctuate prompted at least in part by competitive advantage erosion or undermining through (asset) obsolescence and/or product-process misappropriation or infringement.
When these and other comparably adverse events/acts occur, IA’s value and ability to sustain its value, competitive advantages, and profitability, etc., can be significantly impaired along with their contributory value becoming irreversibly undermined or stifled.
Therefore, having the capability to consistently monitor and measure (inventory) key IA’s at will, positions companies and their management teams to be more responsive to meeting their expanding fiduciary responsibilities, i.e.,
- the inevitable challenges, disputes, and external targeting that routinely occurs.
- allocating – directing asset safeguard-risk resources more efficiently and effectively commensurate with an assets’ life and contributory value cycle.
Mr. Moberly is an intangible asset strategist and risk specialist and author of ‘Safeguarding Intangible Assets’ published by Elsevier in 2014. email@example.com
Michael D. Moberly December 22, 2015 Where attention span really matters’ IA’s (intangible assets) have obviously become irreversibly permanent fixtures – components to most organization’s economics, i.e., their primary sources of value, revenue, and competitive advantage, etc.
And, interestingly, global (business) economies still remain in the earliest of stages, relatively speaking, of the underlying knowledge (IA) era. Through my lens anyway, as an IA strategist and risk specialist, this leaves organizations and their management teams fully obliged to push most conventional (tangible asset) thinking, strategy, and practice about where, when, and how their value, competitiveness, and revenue originate and/or evolve aside and genuinely engage – undertake initiatives intended to achieve the important and necessary eureka moment of ‘I get it’!
However, most organizations and their management teams, frequently gravitate to distinguishable ‘operating cultures’, i.e., the quantitative (tangible) vs. the qualitative (intangible). At that, it would indeed be a misinterpretation and miscalculation should any reader assume the intellectual and structural preparations for engaging an organization’s IA’s to be too disruptive to its culture and/or exceed managerial comfort zones to continue.
On the other hand this may prompt some organization management teams to ask; what type-level of thinking is necessary to effectively cross the chasm from the tangible to the intangible? Perhaps the appropriate response to that question lies in the professional irresponsibility to assume that chasm of IA thinking can be squeezed into bumper sticker ‘sloganisms’ to indulge a presumptively narrow attention span.
There is indeed a thought leader responsibility to assume that matters related to their organization’s IA’s, warrant articulate clarity to think – act differently about when, where, how, and the circumstances which organizational value, competitive advantage, and revenue originate, develop, and convert. An intent of course is to present organizational leadership with relevant and respectful insight and perspective for…
- recognizing how IA’s individually, collectively, and collaboratively contribute to value, competitiveness, and when addressed effectively favorably impact an organization’s community.
- drawing attention to the various ways value – competitive advantage attaches and contributes.
Michael D. Moberly August 19, 2015 ‘A blog where attention span really matters’.
Readers, there is absolutely no dispute to the globally universal economic fact that today 80+% of most company’s value, sources of revenue, and ‘building blocks’ for growth, profitability, competitiveness, and sustainability lie in – directly evolve from intangible assets! So isn’t it quickly approaching the state of being a no-brainer to acquire an operational familiarity with an organization’s intangible assets, because, by doing so, better business decisions are all but sure to follow!
It’s just entirely insufficient now for management teams to (a.) merely know what intangible assets are or which one’s their company – employees have developed, (b.) utilize, or perhaps worse, (c.) succumb to conventional accountancy path of lumping all internally developed intangibles together (indistinguishably) as goodwill.
It’s now essential, if not a fiduciary responsibility to:
- sustain control, use, and ownership of IA’s.
- know precisely how the IA’s contribute to a company’s value and create sources of revenue.
- understand how to utilize, leverage, and position the assets to extract as much value and competitive advantage as possible.
- exercise effective stewardship, oversight, and management of the IA’s and consistently monitor their materiality and contributory value.
By achieving this level of operational and financial familiarity with IA’s, numerous enterprise wide multipliers can follow, for example
1. Add predictability to business transactions when intangible assets and IP are in play by being able to assess the stability, fragility, defensibility, and sustainability of the assets through an IA focused due diligence.
2. Elevate probabilities that projected returns will be achieved, competitive advantages will be sustained or enhanced, asset synergies and efficiencies will develop, and transaction exit strategies affirmed
3. Achieve effective convergence of IA accounting, reporting, and valuation by recognizing their linkages to:
- knowledge management initiatives.
- IP development and safeguards.
- the balanced scorecard.
4. Reduce probability of costly, time consuming, and momentum stifling legal challenges and disputes regarding IA’s by foreseeing circumstances that can ensnare and/or entangle IA’s that will impede a transaction, or erode or undermine its projected synergies, value, competitive advantages, or overall performance.
5. Build an IA focused organizational culture that contributes to
- recognizing, producing, and sustaining control, use, ownership, and value of IA’s.
- elevating organizational awareness to accelerate the pursuit of adverse IA issues, i.e., ownership, value, infringement, misappropriation, theft, etc.
6. Develop a comprehensive OR (organizational resilience – continuity-contingency) plan that encompasses an organization’s key ‘contributory value’ IA’s that will facilitate quicker and more complete recovery following a significant business disruption.