Intangible Assets: The ‘Tipping Point’ Has Arrived For Management Teams!

Michael D. Moberly   December 7, 2009

Malcom Caldwell (author) describes three characteristics (principles) to his 2002 book, The Tipping Point which I believe is, in many ways, analogous to the current intangible asset phenomena.  The Tipping Point, Caldwell says, is merely the ‘biography of an idea’ and the best way to understand the emergence of – transformation of an idea, in this case, the notion that intangible assets have universally and irreversibly replaced tangible (physical) assets as most company’s primary source of value, revenue, sustainability, and foundations for future wealth creation, is to think of that transformation as an epidemic.  That is, ideas, products, and messages, Caldwell posits, spread in a manner comparable to a virus.

Caldwell describes the ‘tipping point’ as the moment when a critical mass, a threshold, a boiling point has been reached.  Of course, I’m referring to the point when management teams, D&O’s, and investors conclude (sense, observe) the ‘tipping point’ has been reached which prompts – influences them to act.  With such consistenly incontravertable evidence and economic facts emerging from the global knowledge-based economies that 65+% of most company’s value, sources of revenue, sustainability, etc., lie in – are directly related to intangible assets and intellectual property (IP), why hasn’t this reality (the tipping point of recognizing intangible assets) become more fully embedded in – integral to management team, D&O, and investor (business) strategy?  Don’t these realities and facts genuinely manifest themselves as clear and consistent signs that a critical mass, a threshold, a boiling point has not only been reached, but should be exploited?

Respectfully, intangible assets are not easy concepts to articulate or apply in business contexts, i.e., profits, revenue, value, etc.  Those unfamiliar with their existance beyond the single application of ‘goodwill’, or unaccustomed to identifying them and/or measuring their performance-contribution to a company’s value, revenue, sustainability, or future wealth creation frequently misperceive-misinterpret them as merely representing esoteric or theoretical concepts best espoused in university lecture halls than in c-suites and boardrooms.  After all, intangibles do lack a conventional sense of physicality and they totally lack any ‘brick and mortor’ context.

Management teams, boards, directors and officers, and investors; the ‘tipping point’ for utilizing and exploiting intangible assets has arrived!  It’s contagious, its the reality that little causes can have a big effect in companies, and positive change can happen, perhaps not gradually, but at one dramatic moment!



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