Are Your Management Teams Disregarding The Company’s Intangible Assets?

Michael D. Moberly     April 1, 2009

For some business decision makers, the phrase ‘knowledge-driven economy’ is considered an over-used and meaningless cliche.  Likewise, is the notion that today, 65+% of most company’s value, sources of revenue, future wealth creation, and sustainability lie in – are directly related to intangible assets.  In either case, there remain many decision makers who mistakenly assume these statements are irrelevant to their SME (small, medium enterprise) or SMM (small, medium multinational) and really, are only applicable to their distant Fortune 500 cousins.

In deference to those views, business decision makers are likely to continue to be dismissive and convey a reluctance for devoting time to learning about, let alone, trying to harness (identify, unravel, assess, maximize, leverage, extract value from) their company’s intangible assets by resorting to one or more of the following rationales:

1.  There is no clear picture (connection) how intangible assets originate and develop within a company and then deliver value, revenue and serve as a foundation for future wealth creation and (company) sustainability…

2.  The money, resources, and time spent on identifying, developing, managing, and extracting value from intangible and other knowledge-based assets is an expense rather than an investment, which can literally walk out the front door and possibly go to a competitor…

3.  There’s no clear picture related to the money, resources, and time necessary for positioning (training) a company to improve the management (stewardship, oversight) of its internal processes to maximize, utilize, and extract as much value as possible from its intangible assets…

4.  It’s difficult to measure – leverage the performance of intangible assets to attract investors and capital because the existing data/information (necessary to achieve this) is often incomplete and the methodologies for measuring are varied and highly subjective…

5.  There are risks associated with being overly transparent about a company’s intangible assets, particularly with the possibility that competitors, raiders, taxing agencies, and trollers could use that information for adverse affects, in other words, why should my company ‘go on front street’ with its intangible assets unless and/or until my competitors do it…

To the contrary, if company’s don’t recognize the importance/relevance of (their) intangible assets and commence practices to achieve effective and consistent stewardship, oversight, and management of those assets now, i.e., to sustain (protect, preserve, monitor) control, use, ownership, and value, don’t expect them to be available, nor their value to be high when circumstances-attitudes change.

(Adapted by Michael D. Moberly from ‘Intangible Assets Observatory’, Policy Trends in Intangible Assets, Report of the European HLEG on the Intangible Economy)

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