Checking the Box is Not Enough: IP is NOT a Commodity

A finely tuned process can be a very good thing.  And in the spirit of agile thinking, lean development, and the ever-increasing need for speed to market, such a process can help refine options, drive strategic focus, and develop new offerings.  However, don’t ever forget that rigid adherence to such processes also can narrow the scope and quality of your thinking, and this can have negative ramifications in regards to your intellectual property (IP) strategy, especially when the IP starts getting treated like a commodity. 

On the positive side, advancements in company processes focusing on the valuation and monetization of IP assets can result in direct and indirect benefits.  Sometimes, and sometimes appropriately so, the number of the IP assets may be as important as the quality of the IP assets. Companies often get a lot of marketing value by advertising how many patents or trademarks they have around the world, even if the quality, monetization ability, or commercial usefulness of many of them may be unknown or even highly questionable.  However, the increase in reputation, interest and revenue that may result from the marketing efforts purely based on numbers can be a plus.

On the border between positive and negative ramifications of treating IP as a commodity is the growing and necessary attention to legal costs.  Cutting legal costs certainly helps the bottom line, and as one way to do this law firms and other service providers often are asked to conduct each step in the development, procurement and management of an IP asset at a flat fee. Each type of IP asset then gets treated the same way, as a commodity, especially when strict timing requirements also are built in. This can be great for reducing and predicting external legal costs, but recognize that your outside counsel often plays a critical role with you in developing your valuable IP assets and the flat fee approach can reduce their ability, availability and willingness to spend extra time working with you to fully identify your inventions, better develop and position your IP assets, and maximize the return on your investments.  You may still get your trademark, your copyright or your patent, but the short term cost advantage you obtained may result in long term negative ramifications from a lower quality asset. Thus, it is critical to find the right balance here.

Another area where over reliance on process can lead to reduced IP asset quality results from the processes often used for the disclosure of inventions and the initial review of these disclosures.  While invention disclosure submission tools and review processes are very helpful, inventors often are not given adequate time to think about and write their invention disclosures, usually are not adequately trained to think about and to recognize the full depth and breadth of their inventions, and may be submitting an invention disclosure more to “hit a number” to meet an invention disclosure submission goal set by their management than to create the best possible invention disclosure.

Further building on the problem created by an incomplete invention disclosure submission, if the review group for the invention disclosure submission does not involve a range of functional backgrounds such as marketing, commercial strategy, and business development, or if the review of the invention disclosure is done too quickly, the review of the invention disclosure usually will be done too narrowly and without adequate information. As a result, the invention disclosure and review processes get completed and the appropriate boxes are checked, but the full depth and breadth of the invention will not be recognized and reviewed.  Thus, the rigid adherence to the processes creates flaws right from the start that then carry forward and limit the quality of the later developed IP asset, as well as the commercial and other monetization activities that the IP asset is intended to support.

Inventions vary, even within the same company. And at best, good invention recognition and review is very complicated.  Building an IP strategy based on good invention recognition takes attention to detail, a willingness to dig deep, multi-functional viewpoints, market insights and competitive environment inputs, and a commitment to spend the time and effort needed, even when this requires less than perfect adherence to the steps in a process. Treating your IP like a commodity will reduce the time and effort put in by the people crucial to maximizing the return on your investments.  The process is followed and the boxes are checked, but the resulting benefit is not maximized.

Don’t let merely following a well-established process, even a good one, dominate your thinking. Simply checking the boxes may not be enough.