Michael D. Moberly May 26, 2009
We’re well into the 21st century and the role intangible assets’ are playing as value and growth facilitators in companies is widely acknowledged, but, primarily, only at the 5,000 foot level.
At that 5,000 foot level, the economic fact – business reality that as much as 65+% of most company’s value, sources of revenue, sustainability, and platforms for future wealth creation are not in dispute, nor is the fact that overall company value has literally shifted from tangible (physical) assets to intangible assets.
The questions are however, why aren’t:
– these realities resonating – manifesting themselves with a broader sense of urgency at the owner-manager level amongst U.S. businesses, particularly SME’s (small, medium size enterprises) and SMM’s (small, medium multinationals)?
– businesses seeking training to better familiarize themselves with intangibles so they may engage in strategies to maximize and extract as much value as possible from those very likely already produced (possessed) but seldom acted on intangible assets?
Cutting to the chase, I and other voices advocating greater recognition and utilization of intangible assets, routinely meet with astute, intelligent, and extraordinarily talented and successful business leaders who routinely articulate – apply the most sophisticated, state-of-the-art managerial techniques to meet their business operational needs and secure competitive advantages, but, mention the words intangibles or intangible assets and eyes often glaze over!
What’s puzzling is, why aren’t these decision makers acting on these ‘in your face’ assets and why are they being overlooked, neglected, or, in some instances, literally dismissed as sources of value, revenue, and competitive advantage?
In part, the lack of enthusiasm for intangible assets, among some decision makers, can be attributed to:
1. accountants who may not fully grasp the contributory (balance sheet) significance of intangibles, therefore are reticent to introduce or explain the relevance and applications of intangibles to their clients…
2. faux strategic planning in companies that inhibit or exclude discussion (planning) about utilizing intangibles as potential revenue and competitive advantage facilitators…
3. mis-characterizing intangible assets and intellectual properties, i.e., patents, trademarks, copyrights, etc., as one-in-the-same which allows some decision makers to question the relevance (ROI) of acting on their intangibles separately…
4. self-deprecating assumptions that their company does not possess intangible assets with sustainable value…
5. the absence of physicality of intangible assets…
Taking affirmative steps to maximize and extract as much value as possible from a company’s intangible assets is not rocket science, it’s just a good and prudent business practice for 2009!
