Michael D. Moberly March 19, 2012
Today, the management, stewardship, oversight, and monitoring of your company’s intangible assets is certainly not a passive ’I’ll do it when I have the time’ task that can be delegated (or relegated) to the uninitiated who lacks, what I consider, the requisite ’fire in the belly’ understanding and advocacy for the economic fact that…
65+% of most company’s value, sources of revenue, and building blocks for growth and sustainability evolve directly from intangible assets!.
Rather, that task is akin to, if not, wholly, a fiduciary responsibility. The task itself need not be an extraordinarily time consuming or costly undertaking. What is required however is a forward thinking and forward looking business acumen to:
- recognize specifically what intangible assets are in the context of the products and/or service your company produces relative to its industry or sector
- examine your company’s internals through an intangible vs. tangible asset lens to allow one to identify, unravel, and assess the assets stability, vulnerability, defensibility, and contributory value
- consider how the assets (intangibles) can be (better) utilized, collaborated, and/or leveraged which entails identifying viable strategies in which additional contributory value and competitive advantages can be extracted and exploited.
Dr. Nick Bontis of McMaster University, identified five additional steps for managing intangible assets in an appropriately titled article ‘The Rising Star of the Chief Knowledge Officer’ published in the Ivey Business Journal. They are as follows:
1. Conduct an initial assessment to identify and unravel each intangible’s status, stability, fragility, value, sustainability, and linkages to producing-delivering-enhancing revenue and competitive advantages for your company!
2. Integrate knowledge – awareness programs about intangible assets throughout the company with linkages to employee training and evaluations!
3. Identify and integrate ‘best practices’ to ensure the intangible assets that have been identified as contributing to value and creating sources of revenue are sustainable, that is, the assets’ value, control, use, and ownership, value, and materiality are monitored and effectively safeguarded!
4. Develop an ‘internal map’ of the companies intangible assets to identify (confirm):
- the assets’ producers, location, value, linkages, contributory value, and status
- relevant/appropriate strategies (how) to effectively utilize, exploit, and leverage the intangibles’ through internal and external collaboration, alliances, and
- strategies to align the assets with the company’s core business and strategic business plan!
5. Monitor (re-assess, re-evaluate, audit) the processes and/or practices related to:
- sustaining and monitoring control, use, ownership, and value of the intangible assets, and
- identifying gaps and/or lapses that should be addressed relative to extracting value from the assets!
An equally important (strategic) addition to these steps is that if any company unknowingly, or is unwilling to undertake the proper initiatives to sustain control, use, ownership, and monitor the value and materiality of its intangible assets, those assets’ value and competitive advantages can quickly diminish or ‘go to zero’. It’s important to recognize that the business (transaction) environment is global, predatorial, increasingly competitive, and often functions in a winner-take-all context, so managing your intangible assets are not tasks that can be overlooked or neglected!
(Adapted by Michael D. Moberly from the work of Dr. Nick Bontis, McMaster University in his published article titled ‘The Rising Star of the Chief Knowledge Officer’ , Ivey Business Journal, March/April, 2002)