Intangible Assets Are Not Merely Theoretical Concepts!

June 29th, 2017. Published under Intangible asset teaching and training., Intangible asset training for management teams.. No Comments.

Michael D. Moberly June 29, 2017 m.moberly@kpstrat.com ‘A business intangible asset blog where attention span really matters’!

I routinely have-the-opportunity to talk with a cross-section of business leaders, management team members, and entrepreneurs about the IA’s (intangible assets) embedded in their organization, generally in the form of intellectual, relationship, and structural capital.

Not long ago, I had a particularly notable conversation with a very astute senior executive who intended no disrespect by suggesting, that the development, unraveling, assessment, and exploitation of IA’s is, through her lens, remains largely theoretical and not a practical exercise she could recommend engaging. I translated her remarks thusly; intangible assets lacked sufficient revenue – competitive advantage side (bottom line) application. I obviously disagree!

Unfortunately, there remain too many business leaders and management team members inclined to rudely characterize the development and exploitation of intangible assets as mere theories, best addressed in university lecture halls as uncollaborated and unsubstantiated opinions that will not hold up to the rigors, stresses, and speed required in today’s aggressive and competitive business (transaction) environments.

Having taught in universities for 25+ years, I can say, without hesitation, that a significant percentage of the time when-if I ever uttered the word theory in a classroom, or during a presentation to a professional (practitioner) association, the initial reaction tended to manifest as presumptions, conveyed by audience ‘body language’ that the intangible asset messages the audience was about to be introduced, would have little, if any, relevance to their ‘real business world’.

Not wishing to have my message advocating businesses to exploit their IA’s reduced to the time- honored sport of theory vs. reality, I chose to re-characterize the word ‘theory’ to represent thoughtful and generally well researched attempts to explain a specific phenomenon, in this instance, the contributory role and value of intangible assets. In my business reality, a theory is an expression of a concept or idea that is testable, replicable, and based upon well-grounded hypotheses. In the world of business management, economics, and organizational behavior, it is an irrefutable economic fact that 80+% of most company’s value, sources of revenue, and ‘building blocks’ for growth, stability, sustainability, and profitability lie in – evolve directly from intangible assets!

While characterizing theories in this manner has paid noticeable dividends to me as an IA strategist and risk specialists, in terms of audience receptivity, which I still apply today, it is still disappointing and frustrating to witness, otherwise intelligent, experienced, and successful business leaders be dismissive of, or wholly reject this well-established and universal economic fact, especially when, as I have found in numerous instances, those same business management teams are leading, unbeknownst to them, a business that is, by definition, IA intensive and dependent!

In my judgment, what prompted intangible asset ‘think tanks’, i.e., Brookings Institution, Athena Alliance, IC Knowledge Center, the Intangible Asset Finance Society, KPSTRAT, and others to engage business intangibles occurred, in part, by demonstrating their conspicuous role in most all business transactions along with the
• need for effective stewardship, oversight, management, exploitation,
and monetization of the assets.
• forward-looking-thinking role for intangible assets in most every
business initiative, process, and/or transactions.
• unrelenting reality that conventional financial statements and
balance sheets no longer convey an adequate, nor complete picture of
a company’s entire (real) financial health absent fully addressing
the role and contributory value of intangible assets.

The inclusion of a company’s intangible assets in valuation, management, and accounting leads to a far more insightful portrait of any businesses current financial circumstance by comprehensively describing a company’s value, its sources of revenue, its future wealth creation potential, its sustainability, profitability, and overall stability through an IA lens.

Thus, to respectfully appeal to the various business persons who remain reluctant to engage their businesses IA’s or still convey skepticism of the role, value, and influence IA’s play in business, what follows are relevant and practical definitions of intangible assets, i.e., they are…

• unique blends of know how-based assets that variously intersect to support specific (often proprietary) methodologies, processes, best practices, and information sharing infrastructures. Adapted by Michael D. Moberly from the experienced work of Weston Anson, CONSOR

• interwoven – embedded processes, relationships, and operating culture in synchronized to market demands-conditions to differentiate businesses (in their market spaces-sectors) to create-deliver value, generate revenue, and build-sustain competitive advantages. Adapted by Michael D. Moberly from the fine work of Michael Porter, Harvard Business School

• economic benefits anchored in company processes, personnel, efficiencies, and/or programs that set a company apart from its competitors to create new and sustainable sources revenue and value. Michael D. Moberly

• at the center of all business innovation; they come at the beginning as ideas, at the middle as processes, and at the end as commercialization and distribution channels. Adapted by Michael D. Moberly from the many years of excellent work of Dr. Baruch Lev, NYU, Stearns School of Economics

• are generally naturally-organically occurring (not necessarily
purposefully manufactured) elements.

• which become embedded in organizational behavior, practices, and
management.

• frequently are variants of intellectual, structural, and/or
relationship capital.

• where they often await recognition, identification, assessment,
development, and conversion.

• when effectively safeguarded and exploited, there is ample evidence
they can produce – deliver lucrative and competitive outcomes.

Intangible Assets and Speed of Innovation, They Really Matter!

June 27th, 2017. Published under 'Safeguarding Intangible Assets', Intangible asset assessments/audits., Intangible asset training for management teams.. No Comments.

Michael D. Moberly June 27, 2017 m.moberly@kpstrat.com ‘A business intangible asset blog where attention span really matters’!

If you are a founder and/or member of the management teams of a RBSU (research based startup), would it matter to you to know that achieving operational familiarity with the relevant intangible assets would favorably affect the speed (pace, momentum, etc.) which your innovation would be launched? (RBSU’s are widely defined as new business start-ups which develop and market new products or services based upon a proprietary technology or skill set.)

It hardly needs stating that the timing attached to product-service launches is important on many levels. one of which, it puts a new venture, on ‘the public stage’ and subject to all-of-the like and dislike variables which inevitably follow.

When stake holder, prospective user, and investor reaction is collectively favorable, launches can put RBSU’s innovation a few steps closer to generating revenue, says Ans Heirman and Bart Clarysse (formerly of Ghent University) in their fine paper ‘Do Intangible Assets at Start-Up Matter for Innovation Speed?’ Heirman and Clarysse’ thesis is that pre-founding R&D efforts in conjunction with the underlying intangible assets, in this instance, team tenure, experience level of founders, and collaborations with third parties, etc., are important contributors to innovation speed. This model, demonstrating the influence of intangible assets was tested using an event-history approach on a dataset of 99 RBSU’s.

To be sure, today, there is much more known about new product development processes in new ventures and which intangible (asset) factors influence the time it takes to launch a RBSU’s first product in the market. For new ventures, time to market is a crucial factor Heirman and Clarysse suggest, and I agree, for four, rather obvious reasons…

1. to gain early cash-flow that leads to greater financial – operational
independence.
2. to gain external visibility and legitimacy (of the product) as
quickly as possible.
3. to try to gain market share as early as prudently possible.
4. to increase the likelihood of RBSU sustainability (survivability).

Relevant literature, according to the work of Brown & Eisenhardt on matters related to new product launches, describes the dominant factors to success lie in various and specific intangible assets, i.e.,
• team tenure and routines (intellectual capital)
• experienced and cross-functional teams. (structural capital)
• alliances or collaborations with other organizations. (relationship
capital)

The speed which an RBSU’s innovation arrives at its launch stage is important for other reasons as well, e.g., attracting successive rounds of investment. Another increasingly crucial factor that affects the speed which RBSU’s innovation is positioned for launch is early recognition to safeguard any-all proprietary, contributory, and enabling intangible assets which in most instances have been (are) already and thoroughly embedded in the innovation itself.

To study how intangible assets influence the time it takes to develop a first product that is ready for launch Heirman and Clarysse used an ‘event-history analysis’ which takes-into-account both the occurrence and timing of specific events contributing to new product launch, while estimating the effects, i.e., contributory – enabling – variable role of intangible assets.
I have witnessed numerous RBSU founding management teams prematurely and probably imprudently, become overly focused on aspirations to seek the issuance of a patent for their innovation. What I believe is rather naïve, some RBSU management members assume ‘the patent route’, standing alone, will serve as sufficient safeguards for the intangible assets underlying their innovation. This aspiration can be influenced by investors preference, often framed as a requisite to favorable investment consideration, i.e., an innovation be issued or have a patent action pending.

What innovators tend to discount, overlook, or have insufficient knowledge, are the valuable (contributing, enabling) intangible assets that routinely serve as the underlying foundation to every innovation. Based solely on my anecdotal assessments from observing numerous venture forums, I routinely estimate that 90+% of the pitching RBSU’s building blocks – foundations for launch, growth, profitability, and sustainability lie in – evolve directly from embedded intangible assets.

Even though Heirman and Clarysse’ paper was published in 2004, it still carries, in my judgment, much relevance insofar as making another persuasive case that precursors – preludes to innovation speed lies in distinguishing, safeguarding, and managing key (contributing, enabling) intangible assets, particularly, the intellectual, relationship, and structural capital.

Heirman and Clarysse also make a very favorable case that other equally important intangible assets, which they refer to as ‘pre-founding R&D efforts’, e.g.,
• innovation team tenure,
• the experience level of the RBSU’s founders and management team
members, and
• third party collaborations, are also important contributors to
innovation speed.

I have found (not rocket science) most entrepreneurs understand that the element of speed of innovation is important for numerous reasons, among them being…
• attracting – acquiring early investment to achieve more (greater)
financial independence,
• achieving broader external visibility and legitimacy for their
innovation as quickly as possible, and
• delineating the innovations’ competitive advantages as early as
possible.

I agree with both Heirman and Clarysse that R&D cycles for innovation can vary widely based on, among other things, the phases of product development and specialized technologies required. Being an intangible asset strategist, risk specialist, and trainer, no surprise here.

Collectively, this confers additional credence on the view that identifying inter-connected clusters of contributory and enabling intangible assets is important insofar as they may re-emerge at some point as enablers to another RBSU innovation. In other words, RBSU management teams should avoid dismissing or neglecting intangibles as if they are a single use asset. Too, it’s perfectly feasible that certain intangibles can be extracted from an already launched innovation to become independent sources of value and revenue.

Intangible Assets Lost By Mistrusting Business Science

June 26th, 2017. Published under Intangible asset teaching and training., Intangible asset training for management teams.. No Comments.

Michael D. Moberly June 26, 2017 m.moberly@kpstrat.com ‘A business intangible asset blog where attention span really matters’.

Michael Myers, managing director of the Rockefeller Foundation, stated recently that “the denial of science is dangerous.” Certainly, no argument here.

People who are inclined to suspect certain science, i.e., climate change denier, or parents’ mistrust of vaccines for their children, etc., arrive at and come to accept such conclusions for various reasons. One reason emerges from predilection to tribalism, that is, people are inclined to believe (accept) what others, in their social group, believe. Thus, for some, sustaining membership in their (a social) group can, at times, and for certain issues, be more important than truth, even truth and evidence-based science with obviousness of validity and proven through replication.

The “denial of science” can be nuanced, Myers says, and it’s not always as simple as flat denial of (all) science as a concept, instead it is often a matter of people being in a state of personal-group distrust of specific science in which doubt, mistrust, and opposing views have been introduced, some, of course, with very specific agendas.

Myers perspective contributes to the challenge being addressed here, i.e., people’s hardening and self-replicating belief systems which go against the relevant science. That is, it’s hard for facts to change people’s minds when people have (an already internalized) incentive to keep believing what they already believe, especially if it’s a belief that’s deeply tied to their (personal) identity. The mental gymnastics they engage to achieve this are known in psychology as “motivated reasoning.” and it’s something that’s extremely hard to get around. If – when people actually change their minds on an issue, it’s likely to happen slowly, and it often has to be about something which they actually want to change their mind about.

Montira Pongsiri, a planetary health science policy adviser at Cornell University suggested that when scientific findings are applied in ways that fix problems in people’s lives, they might be more easily accepted.

“I think it’s the process of science that people don’t necessarily trust,” she said. “It takes a long time.” People who are facing crucial problems now don’t necessarily want to wait for peer review to get an answer, and it can be frustrating when studies contradict each other, or the best answer science has on a question is “We don’t know.”

Myers adds, that one way to convince people about the truth and utility of scientific findings is to apply it on a personal level, e.g., the extreme heat which grounded many commercial air planes at Phoenix area airports recently. Direct connections, i.e., bringing science into the everyday lives of people (and business) is what Myers believes is necessary to rebuild people’s trust in science.”

On the other hand, some business leaders and management teams are inclined to wrap themselves very tightly in convention and past practice which they believe has worked well for them and their company previously. This may contradict what they say at a business or professional association meeting, e.g., advocate, as a business leader, to be forward thinking-looking, along with the ability to rapid adapt to market trends and change. In these instances, I have found, even my most persuasive and compelling truths and counsel that encourage business leaders and management teams to engage the intangible asset side of their business, are sometimes relegated to the back burner or summarily dismissed. Scenarios like this have bothered me for a long time. I couldn’t figure out why seemingly progressive business leaders and management teams who routinely advocate horizonal thinking-looking as a tenant to their business’s success could simultaneously be reserved about operationalizing intangible assets, on behalf of their business.

I remain amazed to witness hesitancy and/or reluctance to what, may be the most significant and inclusive economic – business reality of the last two (plus) decades…the economic fact that 80+% of most company’s value, sources of revenue, competitiveness, growth potential, and sustainability lie in – emerge directly from IA’s.

Businesses can innovate their way out of convention and past practice because intangible assets, i.e., intellectual, structural, and relationship capital are not going away, however, business leadership who elect not to engage the IA-side of their business, may go away. We’re at a point, at least in the U.S., where many don’t have a favorable relationship to progress. Many talk about progress with ambivalence, in part because some business leaders have variously lost faith in business science, aside from the notion for one to go fast, go hard, and go global!

Arguably, we’ve never needed progress in the business sciences and practices more than its needed now, as leverage to remain viable, lucrative, and competitive. And, businesses have had little, if any previous access to operational expertise about intangible asset matters in terms of how and why it’s important to identify unravel, and exploit intangible assets effectively, competitively, and lucratively, i.e., the Business IP and Intangible Asset Blog’, being one example.

Before engaging your company’s intangible assets, ask questions, be skeptical, demand proof and evidence, and don’t take anything for granted. But here’s the thing: when answers to specific questions and proof and evidence are presented, without being purposefully spun to trigger fear, uncertainty, and doubt as preludes to action, business leaders and management teams are obliged to accept it as truthful. Truth, evidence-based research, and facts regarding intangible assets will set business leaders and management teams free. And, yes, while every business leader and management team are entitled to their opinion about what progress is and how their business can or should be more progressive. But no business leader or management team member is entitled to their own facts!

The following were very insightful to writing this blog post.

Michael Specter, writer, New Yorker, TedTalk ‘The Danger of Science Denial’
February 2010 at TED2010

The Challenge of Fighting Mistrust in Science: Emphasizing the way scientific findings play out in people’s everyday lives could help. Julie Beck, June 24, 2017. Atlantic Monthly Dispatches from the Aspen Institutes 2017 Ideas Festival Saturday, June 24th co-hosted by the Aspen Institute and The Atlantic.

The Mistrust of Science, Atul Gawande, The New Yorker, June 10, 2016

Intangible Asset Strategist, Risk Specialist, and Trainer!

June 23rd, 2017. Published under Intangible asset strategy, Intangible asset teaching and training., Intangible asset training for management teams.. 1 Comment.

Michael D. Moberly June 23, 2017 m.moberly@kpstrat.com ‘A business intangible asset blog where attention span really matters’.

I am an intangible asset strategist, risk specialist, and trainer.  Much of my work commences with the premise that business leadership and management teams have fiduciary responsibilities to routinely and objectively ask and ultimately ensure…

is this company effectively positioned, insofar as possessing the
necessary expertise and skill sets, at the ready, to identify, unravel, develop, exploit, and extract as much value, revenue, and competitive
advantage as possible from its intangible assets, while simultaneously monitoring – mitigating risks and safe-guarding each assets’ value, sustainability, and materiality…?

Should the question not be asked or the actions not occur, or fail, little else may matter, because IA (intangible asset) value, competitive advantages, and sources of revenue, etc., will inevitably be vulnerable to rapid erosion, being undermined, and go to zero!

As such, an intangible asset strategist, risk specialist, and trainer can deliver lucrative and sustainable benefits to a company by…

1. Providing guidance when – where necessary for utilizing IA’s, i.e., extracting value, delivering competitive advantages, strategic planning, and measuring asset performance.

2. Adding predictability to business transaction outcomes, projected returns, and exit strategies whenever-however-wherever IA’s are in play by…
a. assessing IA stability, defensibility, value, and sustainability contexts.
b. conducting pre – post transaction due diligence to ensure competitive advantages, synergies, efficiencies, and value of the IA’s remain stable.
c. reducing the probability that project-transaction momentum can be stifled by mitigating circumstances that can…
i. ensnare and/or entangle the assets in costly and time consuming legal challenges.
ii. undermine/erode asset value and performance.
iii. adversely affect asset reputation ‘risk points’.

5. Integrating IA valuation, reporting, and accounting in company governance.

6. Organizing IA intelligent ‘company culture’ that aligns – converges with company’s mission, business objectives, and strategic planning.

7. Implementing organizational resilience (continuity, contingency) planning that encompasses mission essential IA’s to provide quicker recovery following a significant business disruption or reputation risk.

8. Bringing clarity to specific IA factors, i.e., recognition, valuation, separability, transferability, life-value-functionality cycles, risk, and value chain monitoring.

Intangible Asset Explanation!

June 22nd, 2017. Published under Intangible asset teaching and training., Intangible asset training for management teams., Intangible assets contributory value.. No Comments.

Michael D. Moberly June 22, 2017 m.moberly@kpstrat.com ‘A business intangible asset blog where attention span really matters’.

There are certain objectives intangible assets (IA) strategists, trainers, and risk specialists have when engaging clients, two key one’s are…

• ensuring their rationales to business leadership and management teams
for achieving IA operational familiarity resonate, on their terms and
in their context, and

• explaining IA’s contributory role, value, and relevance to their
products, services in terms of competitiveness, revenue, value, and
sustainability.

To be sure, there are numerous business concepts and practices which are less challenging to explain than IA’s (intangible assets) especially to those who have no, or hold only an introductory familiarity with IA’s. Either usually translates to being unaccustomed to distinguishing and exploiting assets, intangible and otherwise, insofar as recognizing and assessing their contributory role and value to a specific project or company as a whole.

I have learned, at least some of the challenges eluded to above are variously related to the variously obscure, cryptic, and somewhat off-putting language used to describe (operationalize) intangibles in business operational contexts, e.g., they

• are non-physical ‘things’ with no set monetary value.
• lack conventional sense of physicality.
• assessing and monitoring and IA’s role, value, and performance within
a company, using conventional methodologies, often produce misleading
and inaccurate indicators.

Admittedly, in many sectors, IA practices are perceived and interpreted as being largely theoretical and absent practical relevance, best espoused in university lecture hall. Yes, IA’s do lack physicality and bear no ’brick and mortar’ (tangible) components, nor are they readily amenable to conventional methods of measurement, management, valuation, and accounting collectively making explanation and rationale murky and suspect.

I find some business leaders and management teams, even though they have invited me to lead conversation about their IA’s, find it personally-professionally challenging to step outside their ‘past practice’ comfort zones and their formative b-school curricula to actively engage IA’s. Finding motivation and rationale to consider contemporary alternatives being espoused easily gets translated as ‘why change what seems to work nicely, thank you’?

Business leadership are generally driven by a sense of pragmatism for meeting quarterly objectives and achieving returns-on-investment, and are also quick to exercise risk aversion when either appears in jeopardy. These operational characteristics-behaviors, while admirable and often rewarded accordingly, also contribute to skepticism about embracing practices which depart from the norm.

Still, the objectives are clear…articulate what intangible assets are, what they aren’t, the various forms they take, and depending on how and when they’re effectively applied and exploited, can lay valuable and strategic foundations to elevate a company’s value, sources of revenue, competitive advantage, market position, and sustainability.

IA strategists and risk specialists in-the-course of conducting seminars, training, and small group briefings are obliged to advise company-business leadership to acquire, develop, and have at the ready, a repertoire of expertise regarding intangible assets designed to proactively address issues and risks which can rapidly materialize particularly in business environments where IA intensity and dependency have indeed, become the norm.

After all, it is an irrefutable economic fact that 80+% of most company’s value, sources of revenue, competitiveness, growth potential, and sustainability lie in – emerge directly from IA’s.

Thanks for taking your time to read!

Leadership Attention Span, A Necessary Intangible Asset

June 19th, 2017. Published under Design thinking., Intangible asset teaching and training., Intangible asset training for management teams.. No Comments.

Michael D. Moberly June 20, 2017 m.moberly@kpstrat.com ‘A business blog where attention span really matters.’

Readers of this blog will notice the premium paid to ‘attention span’ which has become a moniker for much of my work. Advocating longer-focused attention span is not intended to convey arrogance or condescension to readers, instead, it is intended to underscore my belief that there are numerous worthy concepts, theories, models, and hypotheses, etc., that business leadership are variously obligated to acquire sufficient familiarity to make an informed judgment about it relevance to their company or business, its products and/or services, and the types of transactions it may engage. IA’s, for example, conceptually and practically, warrant levels of thought and reflection that extend beyond the brevity of talking points associated with the proverbial ‘power point’ slide deck. The rationale for doing so is embedded in the economic fact that 80+% of most company’s value, sources of revenue, competitiveness, and future wealth creation potential lie in – emerge directly from IA’s. Being inattentive or dismissive of this irrefutable economic fact is done so at a leader’s peril and that of her company.

As articulated in an April 2017 TED Talk by computational neuroscientist Mehdi Ordikhani-Seyedlar, ‘attention is not just about what we focus on, it’s also about what our brains filter out’. It sure would be useful to understand which-what information our respective brains ‘filter’, and why, and presumably absent a conscious effort.

Admittedly my interest in our brain’s ‘information filtering’ feature is somewhat self-serving. For example, I believe the subject matter (IA’s issues) I endeavor to communicate through my blog and books has merit and relevancy to business leadership, management teams, and companies irrespective of sector. I am hard pressed to understand the espousal of any rationale that seeks to explain away why each-and-every business (university) major and practitioner who aspires to be competitive and successful should not take a strong and personal interest.

Certainly, Google Analytics provides important analysis, particularly regarding the what, when, and for how long, i.e., ‘number of clicks and/or visitors’ to online publishing. These ‘analytics’ do not, however, shed light on or otherwise distinguish ‘the why’s’, which, for any author, holds special importance relative to how they frame and write about certain aspects of their on-going research interests.

Is there something I am missing? It is, after all, settled (irrefutable) economic fact that 80+% of most company’s value, sources of revenue, competitiveness, and sustainability today lie in – emerge directly from intangible assets. This economic fact should translate, in conjunction with attention span, as if-when IA’s are recognized, developed, utilized, and exploited effectively, most every company-business can be positioned to achieve projected outcomes and returns. To do so, requires an attention span with varying levels of thought, reflection, perhaps making some adjustments and re-positioning of IA’s. In other words, be routinely engaged in horizonal thinking and strategic planning = attention span!

The TEDTalk given by Dr. Mehdi Ordikhani-Seyedlar, whose expertise lies in investigating, tracking, and monitoring various patterns occurring – present in our brain. He aspires to apply his research to develop computer models which can be used to treat human functionality challenges such as ADHD and to those who have variously lost their ability to communicate.

As business leaders, we should be obliged to focus on a specific topic and/or subject beyond the vagaries of abbreviated attention spans. Unfortunately, human attention span has been minimized, often characterized as the preference to have important, far-reaching subject matter – concepts condensed and delivered with as much brevity as possible, i.e., the proverbial elevator pitch. Too, attention span is also conveyed through dramatized surges of simplified key words purposefully designed to seize-capture one’s fleeting – multi-tasking span of attention which many have come to assume is a perfectly acceptable business norm.

Of all the product-subject marketing practitioners I have come to be acquainted, I am hard pressed to identify (recall) any who does not hold-advocate this perspective in terms of branding and/or capturing the attention of an audience in seconds, not minutes. Often associated with such perspectives is the perceived requisite that targeted audience attention can only be accessed by incorporating – sewing fear, uncertainty, and/or doubt, i.e., FUD factors. Through my lens, however, the relevance and practicality of important (lucrative, competitive) concepts should not, and perhaps cannot, be fully appreciated, distinguished, or rationally-objectively assessed if-when it’s based largely on the brevity of a presentation, explanation, or by infusion of fear, uncertainty, or doubt.

To date, Dr. Ordikhani-Seyedlar’s research suggests that influencing humans to pay closer attention to something may not be all that simple. The reason he points out, lies variously in our attention being simultaneously pulled in many different directions. Rather amazingly he notes, it is actually-impressive if – when an adult can remain focused on a specific subject for an extended period-of-time. Presumably, the length of a person’s attention (span) correlates to one’s personal-professional interest in a particular, subject or topic. He also adds that one’s attention span is affected by what and which information our brains are trying to filter out, which I translate as important – relevant, but as-yet, unexplained element.

Dr. Ordikhani-Seyedlar says there are two general ways we direct our attention…
• First, there is overt attention, that is, people ‘move their eyes’
toward something in-order-to pay attention to it.
• Second, there is covert attention, which he describes as people
paying attention to something, without moving their eyes, presumably
our eyes are variously fixed in a particular-direction.

To explain this, Dr. Ordikhani-Seyedlar applies an analogy, which I have adapted somewhat, to people driving an automobile. He says, when driving, a driver’s overt attention, i.e., the direction of their eyes, are (generally) forward looking. That makes sense. A driver’s covert attention, on the other hand, is, or should be, scanning the periphery, presumably looking for and assessing potential risks, but not necessarily the specifics.

To be sure, there are numerous other inferences which can be drawn from Dr. Ordikhani-Seyedlar’s research. One which I have special interest is analogized from the 1960’s television show ‘Dragnet’ and the memorable and oft repeated statement uttered by Sgt. Joe Friday (principle actor) when questioning victims and/or witnesses to a crime, i.e., ‘just the facts mam’

In my judgment, ‘just the facts’, e.g., brief sound bites, visuals, or abbreviated key word synopsis, seldom translate to meaningful, effective, and comprehensive recognition or understanding and the all-important relevance to and influence on outcomes. So, Sgt. Friday’s ‘just the facts, mam’ is likely to overlook relevant – important underliers to motives and ultimately solving a crime, not unlike the long form blog posts published here which I believe serve readers.

Comments are most welcome at Michael D. Moberly m.moberly@kpstrat.com.

Islamic – Sharia Intellectual Property Professional Service Firms (part 1)

June 15th, 2017. Published under Islamic IP, Law Firms, Transaction negotiations and intangible assets.. No Comments.

Michael D. Moberly June 14, 2017 ‘The business intangible asset blog where attention span really matters!’

Introductory Note: This post represents the second in a series of posts intended to encourage, through explanation, professional service (business, law) firms to acquire operational familiarity with Islamic intellectual property and Sharia interpretations as preludes to attracting – engaging clients and negotiating and executing relevant transactions. Readers can be assured throughout these posts, the sovereignty of Islam is respected.

I am most hopeful this post favorably influences professional service firms serving clients in the IA (intangible asset) and IP (intellectual property) arenas to pursue engagements in which parties are guided by principles-beliefs of Islamic (Sharia) law as being a prudent inevitability and not a troublesome threat that prompts trepidation, fear, or concern for (firm) reputation risk.

Intellectual property is not alien to the Muslim religion. Islam is a religion uniting itself in both the spiritual and temporal aspects of life. Understanding of the sources of Islam is crucial to deducing the concepts that support protection of intellectual property. Muslims are obliged to ensure that everything he or she does is consistent with Sharia. Bashar H. Malkawi www.austlii.edu.au/au/journals/SCULawRw/2013/4.pdf

As readers know, there is an abundance of professional service firms with expertise in western IP (intellectual property) law, common to the G7’s, European Union, World Trade Organization member countries, and signatories to Trade Related Aspects to Intellectual Property Rights (TRIPS). On the other hand, it is challenging to identify practitioners and/or firms’ in the U.S.,

• with confidence of expertise and experience regarding the principles
and application of Islamic (Sharia) law.
• to effectively guide clients on IP matters and execute transactions
in which IP and other IA’s are in play, and
• one or more parties to the transaction, or the transaction itself
takes place in a Muslim nation.

An essential requisite to these circumstances, is for the relevant parties to exhibit knowledge and respect for and work toward achieving the point at which the principles of both western and Islamic (Sharia) IP law can respectfully fuse to effectively negotiate and execute the transaction.

Of course, some professional (business, law) service firms rationalize their reluctance to engage clients – projects in which Sharia law will be a factor, in-light-of periodic and public anti-Sharia rhetoric and protests, which, in some instances, materializes as intolerant legislation.

Of course, there are over-riding geo-strategic economic indicators for PSF’s (professional service firms) to acquire operational level familiarity about how Islamic law treats the development, ownership, value, and transfer of intellectual capital, i.e., products of one’s mind, be it in individual, entrepreneurial, and/or business-to-business (technology transfer) contexts. Doing so entails horizonal thinking-looking PSF’s, e.g., law firms, etc., to acquire current operational level familiarity with the foundations, principles, and interpretations upon which Islamic – Sharia intellectual property law is based and applied.

Certainly not for-the-purpose of challenging Sharia or destabilizing its influence. Rather, because it is a universal and irreversible economic fact that 80+% of most companies, organizations, and institutions’ value, sources of revenue, and foundations for growth, and sustainability lie in – emerge directly from intangible-IP assets.

This reality should be instructive to business services (law) firms in the form of obligations to achieve familiarity with Sharia interpretations of Islamic IP law. The rationale for doing so lies in the economic fact that all forms of IA’s, e.g., intellectual properties, are increasingly integral to every transaction outcome. Operational level familiarity of Islamic IP law and Sharia interpretations will lead to respectful and important insights and strategic guides for negotiating transactions in which win-win outcomes are obligatory.

Fortunately, there are new – current academic (legal) research papers that shed much needed and practical light on both the fundamentals and intricacies of Sharia influence on Islamic intellectual property law. Studying these papers closely guide parties to transactions to minimize reckless and misguided assumptions and making irreversible errors insofar as introducing, proposing, and negotiating a transaction without subordinating or disrespecting western IP law to Islamic IP law.

A particularly useful paper in this regard, and one which I frequently reference is authored by Silvia Beltrametti titled ‘The Legality of Intellectual Property Rights Under Islamic Law’.

A particularly beneficial aspect to Beltrametti’s work is that she does not intend for it to serve, in any way, as a basis to sort out the conventions and/or distinctions between western and Islamic IP laws, regulations, and standards for an imagined or presumed (future – eventual) convergence. Readers would be correct to assume that is my intent here as well.

That said, in my judgment, professional services (business, law) firms that purposefully take strategic initiative to acquire even a rudimentary understanding of and respect for Islamic (Sharia) law and its relevance and application to negotiating and executing transactions is a feature which firms can correctly promote in the context of being an ‘early adopter’ which in turn, elevates the bar for a firm’s competitiveness, reputation, goodwill, and foresightedness.

Sharia law today is often conceived and portrayed through extremely disturbing media visuals applied by its most extreme elements, i.e., Al Quaeda, ISIS, Taliban, etc. Reasonable persons recognize such horrific acts-behaviors are not representative of the whole of Islam. Similarly, some are inclined to suppose the volume of Islamic refugees migrating (escaping) throughout the EU since 2015 and variously to the U.S. and elsewhere, marks the onset of conspiratorial efforts to converge Islamic – Sharia law with western religiosity with dilution and subordination being a predictable outcome. It remains admirable for professional service firms to understand the distinctions and practicalities of Islamic (IP) law and the various Sharia influences and interpretations because doing so can lead to respectful insights and likely collaborations and transactions going forward.

Among other important aspects of Dr. Beltrametti’s work regarding Islamic intellectual property law, is that it is, in many respects, in its early stages of interpretation and promulgation in terms of modernity. Ms. Beltrametti, a JD from the University of Chicago with an emphasis/specialty in IP, states that intellectual property rights, per se, are not regulated by Islamic law and its jurisprudence. Rather, the question or issue, she posits, is whether the principles of Islamic law can be practiced in a manner that provide for IP rights enforcements and safeguards. Professor Beltrametti does this initially by presenting Sharia’s main sources; the Qur’an, the Sunna, Ijma and Qiyas. I should note that the term Sharia, as applied throughout Beltametti’s paper, is synonymous with Islamic law.

Appropriately, Beltrametti notes tensions remain between the predominantly Western, and Islamic (Sharia influenced) perspectives of intellectual property rights, as well as the economic role these intangibles play. Ms. Beltrametti subsequently offers an intriguing and somewhat surprising characterization, i.e., Sharia-based (legal, intellectual property rights) system is flexible and adaptable, characteristics which are not often associated. Perhaps such measured flexibility and elasticity can be exploited by all parties to reflect the economic fact that 80+% of most company’s value, sources of revenue, and foundations for growth and sustainability today reside in or evolve directly from intangible, often IP-based assets.

Comments and questions regarding this post may be directed to m.moberly@kpstrat.com.

Islamic – Sharia Intellectual Property Law Professional Service Firms (part 2)

June 15th, 2017. Published under Intellectual Property Rights, Islamic IP. No Comments.

Michael D. Moberly June 15, 2017 ‘The business IP and intangible asset blog where attention span really matters!’ (m.moberly@kpstrat.com)

Introductory Note: This post represents the second in a series of posts intended to encourage, through explanation, professional service (business, law) firms to acquire operational familiarity with Islamic intellectual property and Sharia interpretations as preludes to attracting – engaging clients and negotiating and executing relevant transactions. Readers can be assured throughout these posts, the sovereignty of Islam is respected.

The proposition here is to challenge arguments that Islamic law and (conventional, western) intellectual property law and practice cannot coexist. That is not to suggest one will be superior – subordinate to the other. Instead, it simply implies there are strategies to respectfully ameliorate both.

So, another informative paper titled ‘Can TRIPS Live in Harmony with Islamic Law: An Investigation of the Relationship between Intellectual Property and Islamic Law?’ authored by Chad M. Cullen (Fall, 2010 SMU Science & Technology Law Review 14 SMU Sci. & Tech. L. Rev. 45) also provides relevant insights to the Islamic faith especially insofar as pointing out that…

• intellectual property (rights) are not new concepts to Islamic rule
of law. In fact, some IPR’s are strengthened by Islamic law, while
others were never explicitly formulated (as law), instead, they
evolved as accepted social-business norms.

• the concept of intellectual property (rights) in Islam has expanded
to include trademarks, patents, and certain forms of copyright.

• granting limited exclusive rights to commercialize such works to
benefit society collectively.

• originators-holders have remedies to stop overt – unauthorized use
of their ‘product of the mind’, presumably acts such as
counterfeiting, infringement, and misappropriation, etc.

• Sharia does not refer to Islamic legal rules only, rather Sharia
serves as an enduring and timeless concept to reflect justice and
fairness, and constitutes a rule of law with a divine connection.

It’s reasonable to conclude from Cullen’s work regarding the relationship between intellectual property and Islamic Law that there is various latitudes exist insofar as how IP and intangible asset matters (under Islamic – Sharia law) can be interpreted and applied. For example, by many accounts, laws intended to deter, prevent, stop, and/or mitigate theft, misappropriation, and infringement of registered IP and/or proprietary intangible assets, i.e., intellectual, relationship, and structural capital in particular, are not consistently or aggressively enforced.

One reason IP laws and safeguards enacted by Arab countries are variously unenforced is due, at least in part, to inherent complexities embedded in the collective nature and community values of Arab culture which presents various challenges insofar as introducing (conventional) IP concepts of propriety, individual ownership, control, and remuneration emanating as products of one’s mind. These important concepts, rooted in religious belief and societal culture, variously affect government or individual inclinations to safeguard IP in Arab countries. In part, that’s because some still hold to the belief that ‘property’, be it spiritual or temporal, is communal, and therefore owned by Allah. However,sharing same is generally not considered to be a violation because some Sharia schools of law permit one to gain profit from their individual efforts. For example, an author or inventor can be entitled to recoup their initial investment and beyond, as-long-as that amount is deemed fair and balanced with the time and effort exerted. Paradoxically, some followers of the Muslim faith draw attention to the fact that intellectual property safeguards are traceable to concepts found in Sharia and are not exclusively a Western phenomenon. (Bashar H. Malkawi)

The Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) is an international agreement administered by the World Trade Organization (WTO). The TRIPS agreement introduced intellectual property law into the international trading system for the first time and arguably is the most comprehensive international agreements on intellectual property matters and safeguards to date. TRIPS was negotiated at the end of the Uruguay Round of the General Agreement on Tariffs and Trade (GATT) in 1994.

Both Cullen and Beltrametti, in their respective research, note that every Islamic nation signatory to TRIPS, is obliged to adhere to – uphold the provisions of the TRIPS agreement. Presumably TRIPS influenced some Islam dominant nations to enact their own IP laws to, at least, reflect TRIPS minimums. In that context, it’s reasonable to assume that countries that are principally guided by the Islamic faith and are also signatories to TRIPS, believe that intellectual property rights are – can be compatible with Sharia principles, interpretations, and practices.

But, in 2001, groups of developing countries (signatories to TRIPS) expressed concern that developed countries were asserting a particularly narrow interpretation of TRIPS regarding ‘promoting access to medicines for all’. Public airing this concern resulted in what is referred to as the Doha Declaration which is a WTO pronouncement that clarifies the scope of TRIPS.

In actual practice, however, passage of intellectual property rights (laws) in predominantly Islamic faith countries, whether sparked by TRIP’s, or other factors, such as WTO requisites, have not been particularly well-received. That is, a percentage of nations – communities with substantial adherence to the Islamic faith, support for conventional IP has not been widespread, in part due to the belief – reality that large percentages of innovation that emerge from IP and proprietary intangible assets, i.e., advanced technologies, etc., originate predominantly in the West, and not from Islamic (religious) sources.

However one may elect to interpret this perspective, it does variously produce reluctance – hesitancy to fully adopt (accept) broader recognition of conventional intellectual property rights in some sectors of Islam

Comments and questions regarding this post are welcome and may be directed to m.moberly@kpstrat.com.

M&A Intangible Asset Advisory

June 8th, 2017. Published under Mergers and Acquisitions, Transaction negotiations and intangible assets.. No Comments.

Michael D. Moberly June 8, 2017 ‘A business intangible asset blog which attention span is necessary’.

There have been countless articles, books, and essays written regarding every conceivable aspect to M&A’s (mergers and acquisitions). Strangely, I find most, at least through my lens, overlook, or omit the role and contribution of intangible assets to the outcome. After all, it is an economic fact – business operation reality today, as it has been for the past 20+/- years, that 80+% of most company’s value, sources of revenue, future wealth creation, and competitiveness lie in – emerge directly from IA’s (intangible assets).

So, would it not be prudent for parties to M&A’s to secure representation from sources well versed in IA matters, especially due diligence and sustaining control, use, ownership, and mitigating risks? Because, after all, it’s the IA’s which are often the catalyst and incentive for M&A’s and certainly critical to the outcome.

Starting in the mid-to-late 1990’s, I had the good fortune, and perhaps good sense, to read-study early products (chapters) of a multi-year project undertaken by The Brookings Institution titled ‘Understanding Intangible Sources of Value’. The principle investigators-authors of the project, several of whom I engaged at the time in discussion for clarity and insight, were a strong troupe of forward looking-thinking practitioners.

IA’s however, prompt debate, less today about their existence and contributions and more about how to value and report IA’s. In other words, conventional financial statements and balance sheets largely exclude or, at the very least, minimize the contributory role and value of IA’s. Thus, most portraits of a company’s financial wealth, health, potential, and competitive standing are, in my judgment, incomplete.

In the M&A arena, it’s important, more so today than perhaps ever before, to recognize that merely because an M&A has been proposed, appears promising, and has progressed to a conventional due diligence stage, does not constitute assurance that any of the projected-anticipated value, synergies, efficiencies, scalability, and competitive advantages are fully capturable, will materialize, or be sustainable. Therefore, IA specific (pre-post transaction) due diligence is a necessary component in deal consummation.

To reasonably assure projections and outcomes will materialize as intended, the due diligence must be sophisticated to recognize the IA’s in play, which includes identifying, unraveling, and assessing asset fragility, vulnerability, sustainability, and transferability in both pre, and post monitoring contexts. Transaction negotiations today are aggressive, competitive, predatorial, and generally manifest as winner-take-all outcomes. Under these circumstances, dismissing and/or relegating the posture and standing of key intangible assets to mere hope and trust is fiduciarily suspect at best.

I have had the privilege to engage many business strategists and decision makers in private conversation. I have no recollection of any disputing my advocacy for IA due diligence for transactions. Assuming these conversations are representative, it would seem prudent that IA’s would be duly considered in every business transaction process.

This post, in part, was inspired by Generational Equity piece titled ‘Precision Sourcing’.

Intangible Assets, Don’t Be Dismissive Before Reading This

June 5th, 2017. Published under Intangible asset training for management teams., Intangible assets contributory value., Intangibles as strategic assets. No Comments.

Michael D. Moberly June 5, 2017 m.moberly@kpstrat.com ‘A business intangible asset blog where attention span really matters’.

Your Company’s Intangible Assets, Don’t Dismiss Them Before You Read This
Based on numerous client engagements and countless detailed conversations about the relevance of intangible assets with business owners, leadership, management teams, investors, and entrepreneurs, I have concluded that, in a significant percentage of circumstances in which there is acknowledged underperformance it is variously related to challenges insofar as distinguishing and converting the contributory role and value of IA’s (intangible assets) to sources of revenue and competitive advantage for every initiative, process, and/or transaction undertaken.
Underlying these challenges is the irrefutable and irreversible economic fact that 80+% of most business’s value, sources of revenue, competitiveness, future wealth creation, reputation, brand, and sustainability today, lie in – emerge directly from intangible assets.
Unfortunately, a percentage of business leaders and management teams, for various reasons, are…

• dismissive of this economic fact and instead convey contentment with
the status quo which typically translates as continuation of time-
honored convention and past practice.

• operationally unfamiliar with the rapid expansion of IA intensive and
dependent firms and instead, interpret IA intensity and dependency as
theoretical embellishments, rather than factual business realities.

It is here that I introduce IA business strategists to Alan Alda’s newly published book titled ‘If I Understood You, Would I Have This Look on My Face?’, which I have taken the liberty of applying here. Alda introduces his book with various scenarios having to do with ‘communicating for understanding and action’, e.g.,

• medical patients not understanding their doctor’s orders sufficiently
to follow them.
• a state’s flood mitigation and dam engineers are unable to convince
relevant authorities to dedicate resources to reinforce-repair a dam
with a high probability-risk of breach.
• parents are unable to develop sufficient trust with their teenage son
and daughter to mitigate the probability one or both will engage in
taking-using illegal (addictive) drugs.

In each instance, if the recipient of the information does not understand, is unreceptive to the cautionary forewarning or taking pre-emptive (mitigating) action, adverse outcomes are likely to materialize.

Admittedly, on several occasions and at various stages of client engagement (on IA matters) I have sensed my counsel being variously discounted. Respectful follow-up discussions with clients often reveal they have construed the intellectual-managerial task of achieving operational level familiarity with their IA’s and work toward developing a business unit and/or company-wide IA intelligent culture exceeds immediate preference to retain much of the status quo. In practical terms, this often translates as applying only the aspects of IA management which they deem the most essential without distinguishing good, better, best.

The importance of bringing operational relevance and clarity to managing companies-business’s through IA’s lens, is apparent from a conversation which I had the pleasure to be engaged several years ago. I was standing near the tarmac in the early morning hours of a chilly spring day with a senior executive of a global air freight company. From our vantage point, we could readily observe ‘as far as our vision would allow’, what I would characterize as, nothing short of…

…a highly choreographed convergence of activities wherein cargo jets were
landing, taxiing, unloading, re-fueling, changing crews, loading and preparing for on-time departure to strategic ‘hubs’ globally.

While I and the executive observed these highly orchestrated activities occurring before us, I turned to the executive and remarked that…

…through my lens, I was observing what amounted to billions of dollars of
of repeatedly – continuously tweaked intangible assets, i.e., intellectual,
structural, and relationship capital which seemingly were converging
seamlessly, efficiently, and timely.

Interestingly, the senior executive’s immediate response to my observation was very matter-of-fact and quite different…

…no Mike, what I see before us, are billions of dollars of tangible – physical
assets; aircraft, equipment, technologies, and trained-skilled personnel
interacting to make this company competitive and efficient, as it must do on
a 24/7/365 basis.

Obviously, readers may draw their own conclusions from the above exchange. However, I ask each to do so in the context of the…

…globally universal economic fact that 80+% of most business’s value, sources of revenue, competitiveness, reputation, brand, and sustainability today, lie in – emerge directly from IA’s (intangible assets).

That’s not to suggest the obviously differing views expressed by myself and the senior executive were (wholly) right or wrong. In this instance, both of our perspectives obviously held merit. Mine, I would argue, may have greater relevance in the long term insofar as this global air cargo carrier sustaining its’ value, competitive advantages, and sustainability. That’s because, this company, like so many others today, is indeed ‘intangible asset intensive and dependent’.

There is absolutely no debate that aircraft and the associated machinery and equipment are understandably expensive tangible assets. However, the contributory role and value of each aircraft is maximized by the company…

• continuously developing, integrating, and aligning relevant
intangible asset efficiencies, i.e., updates, rejuvenations, and re-
purposed processes and systems, ala intellectual, relationship, and
structural capital.

• ability to effectively communicate same in 100+ languages and
dialects wherever this air cargo company has or proposes business
relationships.

• converging each of the above at the right time, right place, and
right way delivers – produces value to the company and its customers
along with competitive advantages that collectively sustain – enhance
its brand, image, and goodwill that is expected and demanded 24/7/365.

So, regardless of what, how, or why I or the senior executive characterize ‘what we observe’, it’s important to affirm, the tangible-physical assets the senior executive referred to are, in my judgment, what follows, not precedes, coordinated and timely integration of ‘go, no go’ intellectual, structural, relationship, and competitive capital (IA’s), ala origins vs. outcomes! IA’s are indeed the foundational requisites underlying the sustainability, competitiveness, and profitability this, and other IA rich (intensive, dependent) companies project and enjoy.

I genuinely enjoy witnessing, following an engagement, wherein business leadership sense the excitement, passion, and receive the economic and competitive advantage benefits from engaging their IA’s. After all, IA’s produce-deliver economic and social realities which are observable, evidentiary, monitorable, and measurable, and contribute to a company’s value, sources of revenue, and sustainability. This is not merely subjective opinion or ‘lecture hall’ theory. Admittedly, merely engaging a company’s IA’s is not the final word, there remains more research and practice. But, the economic fact that 80+% of most company’s value, sources of revenue, competitiveness, and sustainability are inextricably linked to IA’s is not going away.

This post, was in part, influenced by Alan Alda’s newly published book titled ‘If I Understood You, Would I Have This Look on My Face?’