Reasons Why Businesses Overlook Their Intangible Assets…

 Michael D. Moberly, Principal, Founder kpstrat and ‘Business Intangible Asset Blog

Today, and for the foreseeable-future, please recognize – consider, most businesses, irrespective of sector, stage of development, location, or revenues, are increasingly, irreversibly, economically, and operationally, intangible asset intensive, dependent, and reliant.

Experientially, over 20+ years, I have observed numerous-business circumstances, and heard various – reasons why (some) business leaders, management teams, boards, and investors (similarly), convey hesitance – reluctance to become more…

  • engaged in the intangible asset side of their business, i.e., valuable – competitive advantage, revenue generating assets they hold, and likely- have-had-a-direct-hand in surfacing, developing, and introducing, and which routinely contribute to,
  • enhancing the attractivity, competitiveness, valuation of a product, service, offering, brand, transaction, or new initiative they may have initiated and oversee and will benefit from a favorable outcome.

For the record, business intangible assets, exist in, emerge as, and develop from, various forms, contexts, combinations, and collaborations of the right intellectual, structural, and relationship capital (intangible assets) developed – introduced at the right time, in the right way, and at the right cost…

  • which routinely converge – embed in, and are conveyed and exhibited through a business’s operating culture and mission.

Experientially, I have come to interpret most business leaders’ hesitancereluctance to become more engaged in recognizing, differentiating, and safeguarding those, (often) proprietarily developed and applied intangible assets, as,

  • stemming from adherence to particular-conventions of professional training and practice, which, not-infrequently…
  • narrowly define and establish specific circumstances, conditions, and/or parameters, i.e., when, where, how, and duration of an assets’ relevance, valuation, amortization, taxability, and contributions in ‘life cycle’ contexts, and
  • describe an assets’ relevance to business operability – functionality more in near-short term contexts, and less in long term strategic (sustainable) contexts…a practical outcome-of-which is…
  • discourage (time-expertise-effort-cost) considering – applying options – alternatives…
    • for monitoring, safeguarding, and mitigating risk, particularly-to a business’s intangible assets deemed ‘mission essential’ and
    • which can likely – elevate – extend – sustain those assets contributory roles and value adds relative to particular- products, services, brands, transactions, and operating cultures, etc.

Adherence to particular – conventions, promulgated in previous eras dominated by a reliance on ‘building – buying’ bigger – larger tangible – physical assets, i.e., equipment, structures, inventories, and distribution methods and were accordingly enabled – supported by regulatory, statutory, or professional practices relative to their valuation, taxation, benefits, and longevity.

Collectively, the above partially explains – recognizes why some – businesses and their leadership may remain inclined to…

  • overlook, dismiss, disregard, discount, and otherwise be inattentive to the intangible assets, mission essential, and otherwise, they developed today, and likely – hold, and consider proprietary, and which
  • most are variously – embedded in and contribute to every operation, and underlie every transaction, and the outcomes of both, are dependent and reliant.

As always, reader comments are welcome and respected. I would be pleased if you would consider sharing this, as well as other posts @ Business Intangible Asset Blog with friends and colleagues.


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