Michael D. Moberly September 3, 2008
Going way, way back to 2004, Accenture commissioned a survey conducted by the Economist Intelligence Unit in which ‘senior executives from companies around the world were asked to share their views on the management of strategic assets, both tangible and intangible’. Not surprisingly, 94 of the 120 respondents said that ‘managing intangible assets and/or intellectual capital is an important management issue’. But, despite this, 95% of the respondents said (in 2004) they ‘do not have a robust system in place to measure the performance of intangible assets, with 33% saying they ‘had no such system in place at all’ even though, nearly half of the respondents said that ‘the stock market rewards companies that invest in intangible assets’.
So much for the superlatives! While I recognize, and, to be sure, respect each of those executives’ emphasis on measuring the performance of intangibles, perhaps equal emphasis should be placed, up front, on aiding business decision makers along with their boards, officers, and business unit managers to (a.) recognize precisely what intangible assets really are, i.e., how to identify, unravel, and approximate their value, (b.) the various roles – contributions intangibles make to a company’s overall value, revenue, and future wealth creation, in other words, its image, goodwill, reputation, brand, relational capital, and equally important, its sustainability and profitability, and (c.) bringing greater business and economic clarity to a company’s intangible assets in terms of how they can best be utilized and leveraged along with strategies to extract as much value as possible.
Two additional, and perhaps larger points are worthy of making. The first is this; intangible assets are not the sole province of large, multi-national corporations. Rather, intangible assets are truly embedded in most every company, ranging from start-ups and spin-off’s to SME’s (small, medium enterprises) to mature, as well as, maturing firms. Intangible assets have little, if virtually nothing to do with a company’s size. It’s truly not a case of ‘size counts’! Rather, it’s a matter of business decision makers really recognizing what intangible assets their company possesses, produces, and/or has acquired.
And secondly, most issues today related to – affecting a company’s intangible assets have moved from merely being voluntary (I’ll do it if I have time) to truly constituting a fiduciary responsibility!
For the still skeptical, I’m hopeful your time will permit you to assess numerous other posts at this blog.