Intangible Asset Definition in 2008

Michael D. Moberly    July 7, 2008

At the recent (June 23d) National Academies’ conference (Washington, D.C.) I attended…titled Intangible Assets: Measuring and Enhancing Their Contribution to Corporate Value and Economic Growth, one conferee jokingly, but unfortunately, endeavored to describe – define the difference between tangible and intangible assets in the following manner…

• ‘if I can kick it, drop it, or stub my toe on it, then it’s a tangible asset, if not, it may be an intangible asset’…

It’s important to point out that in 2008…intangible assets, unfortunately, were still largely relegated to being little more than mere ‘gleams in businesses eyes’, if that!  Very few recognized their expanding contributory role insofar as shaping-influencing business value, revenues, and competitiveness, other than those attending this conference. 

Frankly, there was little business interest in, or, operational familiarity to…exploit, commercialize, monetize, or license intangibles, other than those attending this seven hour conference.

For the record, intangible assets…

– are the economic benefits anchored – embedded in companies’ distinctive and often times proprietary processes, procedures or practices that set that company apart from its competitors by creating efficiencies, enhancing internal-external relationships or merely providing special edges in the market place.  (Michael D. Moberly)

– can evolve overtime within a company and may not always the result of planned actions or capital allocations.  (Brookings Institutions)

– are unique blends or combinations of procedures, assets, relationships, or culture that can be exploited to differentiate a company from its competitors and create more value.  (Michael Porter)

– are unique knowledge a company and its employees possess and the special value that comes with the understanding and ability how to use it best.   (McKinsey)

Remember, if an asset, intangible or otherwise...adds value, is the source of revenue, and/or adds competitive advantages to a business, decision makers are (fiduciarily) obliged to put best practices in place to sustain (protect, preserve) control, use, ownership, and monitor fluctuations in key assets’ value!

Michael D. Moberly  m.moberly@kpstrat.com  St. Louis Business Intangible Asset Blog since May 2006, 600+ published blog posts ‘where one’s attention span, business intangible assets, and solutions converge’.