Michael D. Moberly June 6, 2012
On numerous occasions I have been present when management team members of SME’s (small, medium enterprises) and SMM’s (small, medium multinationals) express dismissiveness and/or trivialize the relevance – applicability of the…
- phrase ‘knowledge-based global economy’, and
- economic fact that 65+% of most companies’ value, sources of revenue, and ‘building blocks’ for growth and sustainability evolve directly from a company’s intangible assets.
While it is certainly not my intent to characterize all SME and SMM management teams with the same broad negative brush, I never have to look very hard to find management team members who remain stagnant in their views, particular about utilizing – exploiting their intangible assets, and therefore prone to characterizing either statement above as being (a.) more cliché than reality, or (b.) more relevant to Fortune 1000’s than SME’s and SMM’s, which, in somewhat of a self-deprecating manner, assume large firms are superior because they have an endless supply of intellectual capital, innovation, and resources sufficient to build valuable and sustainable portfolios of intangible assets.
Of course, I don’t know how you as a reader of this blog may perceive the above, but I advocate this reality; unless and until management teams, c-suites, and boards:
- actually engage (i.e., identify, unravel, nurture, position, and assess) their company’s intangible assets on a regular basis, and
- recognize that consistent management, stewardship, and oversight of thoseassets are necessary preludes to
- exploit, leverage, and extract value from the assets, and
- sustain control, use, ownership, and monitor their value and materiality.
…such misperceptions will, in all likelihood, persist for the foreseeable future!
As Dr. Kenan Jarboe, Executive Director of Athena Alliance says, (a Washington, D.C.-based ‘intangible asset’ think tank) intangible assets are ‘veritable goldmines of un-acknowledged and un-utilized assets’. As long as they remain in those states, the result will inevitably be substantial and unrealized (asset) value being left on countless negotiating tables un-mentioned and untouched, yet increasingly vulnerable to economic and competitive advantage adversaries globally to capture and exploit for themselves.
Because my preference, by choice, is to focus on the SME and SMM community which consists of some 20+ million firms in the U.S. alone, I respectfully acknowledge that a significant percentage of those management teams and c-suites sense they have numerous other challenges and distractions which pre-empt having the energy, time, reflective inquisitiveness, and ultimately, inclination to act on their company’s intangible assets and try to turn them into producers of revenue, competitive advantage, and ‘building blocks’ for growth and expansion.
Equally respectfully, SME and SMM management teams are, generally speaking, realists! That is, they recognize that before embarking on a ‘new’ initiative, i.e., the management, stewardship, and oversight of intangible assets, three things, at minimum, must be in place (up front) before they may become receptive to devoting the necessary time and resources…
1. incentives, i.e., specific tax advantages and direct (immediate) financial inducements, etc., and/or
2. mandates by regulatory agencies (every company has doing it), and
3. relevant training, i.e. achieving a practical and operational familiarity with intangibles that allows management teams to rapidly commence identifying, unraveling, assessing, positioning, and exploiting their intangible assets.
With respect to #1 and #2 above, Dr. Jarboe (Athena Alliance) has written extensively on these subjects and they require (federal, state) legislative action. On the other hand, #3 is essentially independent. That is to say, forward looking – forward thinking management teams should feel obliged, if not compelled as a fiduciary responsibility emanating from their boards, stakeholders, customers, and/or clients, etc., to proceed now toward achieving the necessary level of operational familiarity that would enable them to engage their companies’ intangibles effectively, efficiently, and at will to extract as much value as possible!
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