Rembrandt’s Are Not Only In The Company Attic!

Michael D. Moberly   September 7, 2010

Here’s an interesting perspective once offered by Ashok Jain, a principal in the (IP) valuation services unit of Deloitte.  He suggests that (his) interactions with large U.S. companies lead him to the conclusion that while most profess a fairly high-minded level of IP prowess, relatively few can answer substantive questions about the management of their IP, e.g., does your company maintain an inventory of its patents?, which patents (IP in general) are core to business operations and strategic plan? and, is your company exploiting its IP and other intangible assets to generate the greatest possible value?

Other experts (in the IP and intangible asset arena) suggest that many business decision makers who have achieved strong (national, international) reputations for creating and using new ideas is not matched by their willingness or ability to actually accept (assume) a personal role in the  management (stewardship, oversight) of intellectual property and intangible asset matters.  Instead, it’s reported that many merely delegate such responsibilities to either the technical and/or legal side of their business. 

One possible explanation for this behavior is that technical – legal (business) units are typically portrayed as (assumed to be) cost centers, not profit centers which seemingly gives credence to the view that there is little interest among management teams and boards regarding the business (return on investment) aspects of utilizing IP and intangibles, i.e., to elevate company value, create sources of revenue, and serve as ‘building blocks’ for future (company) wealth creation. 

Still, other IP and intangible asset experts suggest that a large percentage of companies literally give away – inadvertently relinquish valuable IP and intangibles without realizing it, and don’t effectively use (their) IP and intangibles (offensively or defensively) to block competitors, generate new revenue streams, or even increase leverage points within their respective supply – value chain.

Do all these perspectives constitute a crisis in the management and oversight of IP – intangible assets?  While the term crisis may be too strong a term to explain current practices, it does, in my view, represent another example of management teams and boards not taking their (fiduciary) responsibilities for the oversight, stewardship, and management of (their) IP and intangible assets as seriously as they should, especially when looking at it through a business – return on investment lens.

Being a strong advocate of using intangibles; yes, I do believe companies (management teams, boards, etc.) need to take their intangible assets and intellectual property (IP) more seriously and not consider them to merely be ‘sandboxes’ in which a little H2O can be periodically added to enable the erection of temporary ‘castles’ that will quickly crumble or disolve into unrecognizable (non-value or revenue producing) lumps as the moisture evaporates.   

Particularly today, when most all businesses are on the front edge of the knowledge-based global economy, wherein intangibles factually comprise increasingly higher percentages of company value, revenue, and future wealth creation, management teams and boards need to recognize how intangibles can be applied.  This includes not overlooking the nuanced ways of using (leveraging, positioning, bundling) these assets as strategic weapons. 

What’s interesting is that this can occur, sometimes very simply, by ensuring the right parties, with the right expertise are ‘at the table’.  This means including specialists that hold, not merely legal – technical expertise about intangibles, but specialists with specific business acumen (sense) to make those assets literally execute, i.e., produce the value and revenue opportunities which, in most instances, they’re capable.  So to, should product development and design meetings include specialists on sustaining control, use, ownership, and monitoring the value and materiality of intellectual assets.

The end game, of course, is to ensure that a company’s investments in and/or acquisition of intangibles, IP, and R&D, blend effectively with a company’s strategic and marketing planning.  To be sure, there is a growing number of management teams and boards who not only ‘get it’, but are ‘getting it right’.  Often though, ‘getting it right’ has been preceeded by mis-steps or missed opportunities rooted in the presumption that intangibles and IP are strictly legal-technical functions, i.e., patent, trademark, copyright, etc., absent recognition for the (business) fiduciary responsibilities related to asset management, stewardship, and oversight.  This, of course, underlies the reason why such large percentages of IP (and intangibles overall) are ‘non-practiced’.  In other words, the R&D, IP, and intangible assets a company produces often go one way, while the strategic marketing group goes another way, and never the ‘tween shall meet’.

One result of course, is that a significant percentage of companies leave IP and intangibles ‘on the table’, i.e., either under-utilized or unused.  There remain a lot of ‘Rembrandt’s, but they’re not all in a company’s attic, rather, they’re right in front of us.  They merely need to be identified, unraveled, assessed, and put to work!

(This post was inspired and adapted by Michael D. Moberly from article in Chief Executive.Net, titled ‘Taking Intellectual Property Seriously’.)  Reference to book authored by Kevin G. Rivetter and David Kline titled ‘Rembrandt’s In The Attic: Unlocking The Hidden Value of Patents’.

The ‘Business IP and Intangible Asset Blog’ is researched and written by Michael D. Moberly, president and founder of Knowledge Protection Strategies –  The intent of Mr. Moberly’s blog is to provide insights and perspective to aid in a cross-disciplinary approach for identifying, assessing, valuing, protecting, utilizing, and extracting value from intangible assets.  Your comments regarding my blog posts are welcome at [email protected]

While visiting my blog, you are encouraged to browse other topics/subjects (left column, below photograph) .  Should you find particular topics of interest or relevant to your circumstance,  I would welcome your inquiry about consulting, conducting an assessment, training program, or speaking engagement to your company or professional association at 314-440-3593.


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