Harvesting Intellectual Property

There is great importance in knowing how to harvest your intellectual property (“IP”) as well as how to develop future strategies with that intellectual property.  An attorney will develop legal strategies and monitor for protection on key IP assets.  Further, the attorney will build a shield and sword for the business to prevent and avoid infringement as well as setup in-licensing budgets and policies. This actively creates barrier to entry with competition by patenting their protects and litigating anyone who attempts to use such innovations without permission or licenses.

There are three (3) strategic approaches to Intellectual Property:

1) The Traditional View is where IP assets enhance the company’s competitive advantage and ability to defend competition. This Traditional View is a reactive and passive approach and IP is seen as a shield to protect market share;

 2) The Current View is where IP assets should be viewed as an asset and profit center rather than for just a defensive purpose. Profits can be through licensing fees. This Current View is to be a proactive or systemic approach; and

3) The Future View is where IP assets are the premiere drivers of business strategy encompassing human capital, organizational capital, and customer relationship capital. This Future View is used to protect and defend the company’s strategic position in domestic and global markets as well as create new markets. Additionally, this Future view is a core focus or strategic approach.

Your business should have an IP strategy for a portfolio of growth and enforcement. “An intellectual capital harvesting plan is a plan to manage risks and challenges involved in implementing a new growth strategy based on the assets being develop and should acknowledge that growth and success are moving targets by anticipating as many future events or circumstances that will affect the company’s objectives.”[1] A business’s signature products and/or services maintain a powerful niche and drive business and development as well growth.

Once the IP is harvested, the next step requires the business to identify how to leverage that IP.  Leveraging IP involves using the company’s brand personality, strategy, goals, budget, outlook, and approach. The key is to monitor and make sure the company can control its message.  If someone else is recklessly in control of the message, it could dilute what the company built and dilute the brand, thus harming the company. Leveraging IP also means being innovative in how the company uses its existing resources as well as the ability to develop and evolve with the needs and demands of their consumers. Leveraging IP is not about leveraging a product, it is about the ability to evolve and innovate by reassessing, reevaluating, and restructuring it assets, especially with intellectual property. Constantly revisiting that what it is now, will be what it is in the future.

Intellectual asset harvesting must be proactive rather than reactive, strategic rather than tacit, and rewarded rather than discouraged.[2] Intellectual asset harvesting must take a long-term approach in strategy and thinking.[3] Companies must invest in organizing, documenting, and coding the IP assets.[4] An accurate IP valuation is very important to shareholder value as well as those who are seeking a return on investment. The IP valuation method I prefer is the income-based valuation method because it presents the potential financial costs of exposure to liability with monetary losses as its main focus. This income-based valuation method gives the company a good idea of the risks versus the rewards. This will allow a company to develop a limited liability company or holding company to shift the liability if the company seeks to take on a risky proposition. The risks a company may face can open the door to costly attorney fees and tedious litigation.

A business’s resources, advocacy, testing, and sustainability in context to intellectual property would be preparing, developing, and strategizing trademarks, copyrights, and trade secrets in a way that best suits the organization.  It is important to hire a legal professional as due diligence in registering your companies IP assets and protecting such information as there is value in tangible assets and intangible assets.

[1] Harvesting Intangible Assets, Andrew J. Sherman, pg. 158

[2] Harvesting Intangible Assets, Sherman Andrew, pg 117.

[3] Harvesting Intangible Assets, Sherman Andrew, pg 117.

[4] Harvesting Intangible Assets, Sherman Andrew, pg 118.