Michael D. Moberly April 21, 2011
Helping companies create, build, and deliver value, sources of revenue, and competitive advantages from their intangible assets is the goal.
However, since there is absolutely no one profession that can legitimately lay claim to being the sole repository of knowledge about ‘all things intangible’, it seems only prudent, in 2011, to literally converge the expertise of the various domains that (presumably) have such knowledge – familiarity with intangibles, i.e., intangible asset management specialist, IP legal counsel, accounting, risk management, marketing, etc., to execute the best strategy and the best outcome. After all, it is an economic fact – business reality today, that 65+% of most company’s value, sources of revenue, competitive advantages, and building blocks for growth and future wealth creation lie in – directly evolve from intangible assets!
Companies operating and competing in the very real knowledge (intangible asset) based economy, require highly nuanced (best practice) strategies to utilize their intangibles as effectively as possible, i.e., their stewardship, oversight, and management. Collectively, this has produced many new and far reaching challenges for management teams and boards to contend.
One challenge is meeting the rising fiduciary responsibilities associated with the overall management of intangibles and the ability/competencies to actually sustain control, use, ownership, and monitor the value and materiality of a company’s revenue producing – competitive advantage driving intangible assets.
A second challenge, for still a portion of management teams and boards, is recognizing the reality that intangible assets are literally embedded in most every company’s processes, procedures, and practices, regardless of its size, maturity, or industry sector. It’s a matter of being able to identify those assets and exploit their contributive – collaborative value as effectively and efficiently as possible.
A third challenge is ensuring the requisite competencies are in place, of course, to identify, unravel, assess, position, and bundle, if necessary, the assets to effectively and profitably utilize them in a broad range of business circumstances and transactions in which intangibles are routinely either in play and/or part of a deal.
A fourth challenge for companies and their management teams and boards is surviving, that is, remaining competitive, profitable, and sustainable throughout this economic recession and continuously evolving business (global) landscape.
The overall rationale for converging the expertise found in intangible asset management, IP legal counsel, accounting, risk management, and marketing is to overcome each of these challenges because…
1. There is no other time in business governance – management history when steadily rising percentages of company value, sources of revenue, and growth potential are so deeply rooted in intangibles.
2. There is a necessity to re-frame the management, stewardship, and oversight of a company’s intangibles as being fiduciary responsibilities that demand enterprise wide collaboration and consensus, not siloed or separate legal, management, accounting, marketing, or risk management processes or decisions.
3. All too frequently, the contributions intangible assets make to company revenue, value, competitiveness, and market position are overlooked, dismissed, neglected, undervalued, left un-safeguarded, and ultimately lost, diluted, or leached out to competitors.
4. Intangible assets have become much more than mere tools to manage and/or enhance other (tangible, physical) assets. Instead, intangibles are now valuable and often times stand alone commodities that can be developed, positioned, integrated, and utilized to produce revenue, enhance competitive advantages, and otherwise add real value to a company.
5. The time frame when company’s can realize the most value from their intangible assets generally remains compressed relative to the assets respective life, contributory value, and functionality cycle. In part, this ‘compression’ is due to (a.) lower barries to market entry by competitors, and (b.) rapid profits being achieved from, what I call, predatorial, sophisticated, and global product/service piracy and counterfeiting operations that consistently pollute and de-value legitimate supply chains.
6. The growing (global) universality (imposition) of regulatory mandates, i.e., country – alliance equivilents to Sarbanes-Oxley and FAS 141 and 142, etc., relative to accounting, reporting risks, value, materiality changes, and financial performance of intangible assets.
7. The financial reality that intangibles and intellectual property can advance a company (economically, competitively, etc.) only so long as control, use, ownership, value and materialty can be sustained.
Please remember, no one profession can legitimately lay claim to being the sole repository of knowledge about ‘all things intangible’!
Each ‘Business IP and Intangible Asset Blog’ post is developed, researched, and written by Mike Moberly to provide readers with insights and additional and sometimes alternative views to aid in identifying, assessing, valuing, protecting, and profiting from their intangible assets through better management, stewardship, and oversight. I welcome and respect your comments and criticisms at firstname.lastname@example.org.
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