Embedded Intangible Assets, Institutional Past Practice, and Regulation

Management teams are occasionally known to express displeasure with regulatory mandates which affect their business…but often, such annoyances are manifestations of convention, i.e., deeply rooted ‘past practices’, which, for various reasons, have become institutionalized within a business, as the norm.

Two, of numerous, past practices which have come to manifest as government regulatory rules and policy are…

  • the inclination to conceive and frame ‘business operation’ options and strategic plans only through the lens of those past practices and conventions! (Adapted by Michael D. Moberly from the fine work of Jeffrey Moore in ‘Crossing the Chasm’)
  • not recognizing, exploiting, or dismissing the intangible assets most every business produces, i.e., specialized, unique, ‘business centric’ forms of intellectual, structural, and relationship capital.  https://kpstrat.com/wp-admin/post.php?post=788

To aid in mitigating – remedying such oversights…I have cited seven rationales below which describe how and why company boards and management teams are obliged, perhaps fiduciarily so, to recognize, develop, and exploit intangible asset’s….

1. It is an economic fact…that most businesses are in-the-midst of intertwining global economies and transactions dominated by intangible assets, i.e., 80+% of most company’s value, sources of revenue, competitiveness, sustainability and foundations for future wealth creation lie in – emerge directly from intangible (non-physical) assets! Adapted by Michael D. Moberly from the ‘ground breaking’ work of The Brookings Institution, Intangibles Research Project and Weston Anson, CONSOR

2. There is no other time in the history of company-organization governance…when effective practices to safeguard, preserve, and monitor the contributory role and value of intangible assets and mitigate the attendant risks is more important, or serve as more direct contributors to achieving and sustaining (company, business) growth, profitability, value, and competitive advantage. Michael D. Moberly

3. In today’s increasingly competitive, predatorial, and global business transaction environments…(a.) slight advances in technology, (b.) minor improvements in production quality, and/or (c.) small refinements in business processes, can distinguish and add significant value to a company over their market (space – sector) rivals. Adapted by Michael D. Moberly from the fine work of Christopher R.J. Pace

4. An increasingly significant source of company’s competitive advantage…emerges from business leaders who recognize how, when, and the circumstances to apply their company’s unique and proprietary intellectual, structural, and relationship capital.  Adapted by Michael D. Moberly from the McKinsey Quarterly, 2004  https://kpstrat.com/wp-admin/post.php?post=258

5. The time frames when the most value, revenue, and competitive advantage can be realized from intangible assets…is being compressed, due, in no small part, to the presumptive need for companies and their  decision makers to execute at ‘keystroke speeds’, irrespective of the type of transaction and accompanying risk. Weston Anson and Michael D. Moberly  https://kpstrat.com/wp-admin/post.php?post=143

6. The economics of infringing –and product counterfeiting have become embedded in – integral to many countries GDP (gross domestic product)…and far more lucrative than investing in independent origination, R&D, and patenting. Michael D. Moberly

7. Relying on conventional (risk) priorities while misunderstanding intangible asset safeguards…i.e., risk mitigation, materialization, and value preservation carry higher probability of occurrence when regulatory mandates and/or company audit policies-practices are conceived, designed, and implemented through compliance only lens vs. an enterprise-wide risk management lens. Michael D. Moberly

  • The keys to intangible asset risk mitigation lie in…consistent execution of practices – policies designed to sustain control, use, and ownership of strategic assets which have definitive contributory roles, value, revenue generation, and competitive advantages!

Michael D. Moberly  April 18, 2018  St. Louis  [email protected]  The ‘Business Intangible Asset Blog’ since May 2006 https://kpstrat.com/blog where attention span, business realities, and solutions meet.

Readers are invited to explore other products, books, and papers I have published at https://kpstrat.com/papers

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