Intellectual Property Strategy

Intellectual Property Strategy

Dr. Elijah EzenduFIMC, FCCM, FIIAN, FBDI, FAAFM, FSSM, MIMIS, MIAP, MITD, ACIArb, ACIPM,

PhD, DocM, MBA, CWM, CBDA, CMA, MPM, PME, CSOL, CCIP, CMC, CMgr

“Skills and knowledge have become the only source of sustainable long-term competitive advantage” - Lester Thurow

Corporate IP

1. How does the top management view IP?

2. Has your firm developed IP Strategy?

3. What is the expanse of the IP Portfolio?

4. Does your firm own its IP?

5. Is there any licensing or other agreements that compromised ownership?

6. What is the pricing standard for IP?

7. How effective is the fee collection?

Valuation Measurement: Discounted Cash Flow Estimate of Market Size Royalty Rate Impact on Market

Scorecards: Normal Scorecards Balanced Scorecards

Assessment: Standard Assessment System

Measuring Value of Intellectual Property

IP as Part of Growth and Transaction Strategy

Source: Monette Stephens

Value Assessment

Value Realization

Growth and Transaction Planning

Maximize Strengths Mitigate Risks Technical Due DiligenceIP AssessmentMarket LandscapeFinancial ValuationTechnology PotentialRisk AssessmentBuyer Assessment

M & A Transaction AdvisoryAsset DivestitureIP LicensingLeveraged BuyoutsInvestment and Private Placement

Prioritization of Highest Opportunity MarketsStrategic Partnering Programme DevelopmentStrategic Sales to Target Accounts

Technology RisksLegal/Contract ReviewProduct RoadmapTarget MarketPatent Protection

Value Extraction in Action

Intellectual Capital

Value Extraction

IPCreation

Exclusivity

Exchange

Industry Standard

Asset

Prestige

Bargaining Power

Steps in IP Strategy Development

• Analysis• Refinement and Alignment• Deployment

Strategy Deployment 1

• IP strategy conveyance– IP strategy maps– IP strategic initiative development

• IP strategy review– Measure– Key learning and dissemination– External benchmarking– Adjustments and corrections

• Designing and refining organizationally-appropriate IP management models

• Interim and contract/project IP management• IP management recruiting

Strategy Deployment 2

• IP audits and utilization reviews• IP valuations, qualitative and quantitative• IP portfolio review and optimization• IP litigation planning and management, including

infringement investigations• IP process integration and improvement, e.g. Concept

development, product development, commercialization• Boosting brands with IP• IP out-licensing and divestments• IP sourcing, due diligence, in-licensing, and acquisitions

Strategy Deployment 3

• Managing IP under partnership, alliance and contract R&D agreements

• Designing and executing programs to destroy or limit competitor’s IP monopolies

• Freedom to operate reviews• Generation of IP-related competitive intelligence,

including highly rational analyses of complex IP data sets, e.g., “patent mapping”.

Source: Falco-Archer

Managing IP in Outsourcing

• Retain ownership of IP rights• Put measures against unauthorized

use or disclosure of trade secrets• Avoid provider using third party IP

without due permission • Secure ownership of new IP rights

created by the provider while working for the firm

Benefits of Intellectual Property

1. Competitive differentiator

2. Provides exclusivity

3. Increase in Performance

4. Improved Sustainability

Types of Intellectual Property

1. Patents

2. Trademarks

3. Copyrights

4. Trade Secrets

5. Industrial Designs

6. Geographical Indication

Patent

“A patent is an exclusive right granted for an invention, which is a product or a process that provides a new way of doing something, or offers a new technical solution to a problem. A patent provides protection for the invention to the owner of the patent for a limited period, generally 20 years.”

- World Intellectual Property Organization

Features of Patent

• It’s a statutory monopoly for a particular invention• It provides exclusive rights to use, sell, manufacture and

license that invention• Its scope depends on claims• protection occurs on issuance• The rights are only in countries of issues

What is an Invention?

It’s a process, machine, art or composition of matter which is new and useful or fresh improvement.

Non-Patentable Things

i. General Informationii. Mathematical Methodsiii. Things that are not usefuliv. Scientific Principlesv. Works of Authorshipvi. Procedure of Medical Treatmentvii. Discovery of new element or substance

Three Patent Approaches

i. Pioneering Patents: It’s usually short, broad and general in focus due to absence of previous work.

ii. Improvement Patents: This is very detailed and specific but still shorter than a product patent.

iii. Product Patents: This is a long and very detailed patent that pertains to a specific product.

Types of Patents

• Provisional• Utility – Machine – Process – Article of Manufacture – Composition of Matter• Design• Plant

Structure of a Patent

Abstract: General overview of the invention.

Specification:• Description of the invention• The manner and process of making and using it,• The precise invention• Describe completely specific embodiment of the process, machine, manufacture, composition of matter, or improvement invented, and must explain the mode of operation or principle whenever applicable.• Prior art• Drawings

Claims:• Defines the way that the patent will be used• The claims are either independent or dependent on other claims

Invalidity and Infringement

Invalidity: • Prior Art• General Knowledge

Infringement:• This is attributable to excessively or insufficiently broad claims

Strategy-Crafting Phase

Evaluation of patentable technologies and registration of patent

Deployment Phase

Licensing Competitive Intelligence Litigation

Patent Portfolio Strategy

Patent Objectives

• Increase the firm’s market value• Provide leverage for growth• Protection of process/technology/patent

knowledge• Facilitate protection of future business

Patent Portfolio Range

• Core patents: Used for protecting key product innovations

• Camouflage Patents: Used for deceiving competitors

• Minefield Patents: Used for inhibiting competitors

• Application Patents: Used for protecting methodology, equipment and parts

Patent Portfolio Analysis

• Relationship of Specified Technology with Business Objectives

• Legal Status of Claim, Highlighting Scope of Technology and Expanse of draft

• Geographical Distribution• Availability of Blocking-off Patent• Average Life-Cycle of Technology• Current Financial Performance• Future Financial Performance

International Regulations Patent Cooperation Treaty (PCT)

http://www.wipo.int/treaties/en/registration/pct/The PCT makes it possible to seek patent protection for an invention simultaneously in each of a large number of countries by filing an “international” patent application. Such an application may be filed by anyone who is a national or resident of a PCT contracting State. It may generally be filed with the national patent office of the contracting State of which the applicant is a national or resident or, at the applicant’s option, with the International Bureau of WIPO in Geneva.

Trade-Related Aspect of Intellectual Property Rights (TRIPS)http://www.wto.org/english/tratop_e/TRIPS_e/trips_e.htmThe TRIPS Agreement is normally enforced by WTO

Inventorship and Assignment

Inventors within the organization should be appropriately identified, rewarded and harnessed.

Inventors should be obligated to assign their rights to the firm. This can be structured such that at the point of entry into the firm, workers would be mandated to assign rights of every invention within the firm.

Patent Protection in Strategic Alliances

Patent strategy must drive a firm to apportion patent rights within governing agreements of strategic alliances. In this case, grounds for assignment are as follows:

• Technology• Inventorship

• Employee prevented from joining

competitors for a period of 6 months to 3 years

• Employee prevented from disclosing sensitive information to future employers

Non Compete (NC)

Controlling Intellectual Property

Uses• Cheap way to block patents• Assigns invention to company• X key employee to competitor• Control use of proprietary• Protect patenting rights• Provide for independence• Maintain temporary access• Control for life of IP

Types• Publishing• Assignment• Non-compete• Material Transfer• Non-disclosure Agreement• Joint Invention• Options• Licenses

Asset and Protection

• Invention

• Logo, Mark

• Physical expression of ideas

• Marketplace and

Existing Technology

Knowledge

• Patents

• Trademarks

• Copyrights

• Trade Secrets and

Non-competes or

publication

Type of Asset Mode of Protection

Dr. Elijah Ezendu is Award-Winning Business Expert & Certified Management Consultant with expertise in HR, OD, Competitive Intelligence, Strategy, Restructuring, Business Development, Sales & Marketing, Interim Management, CSR, Leadership, Project & Programme Management, Cost Management, Outsourcing, Franchising, Intellectual Capital, eBusiness, Social Media, Software Architecture, Cloud Computing, eLearning & International Business. He holds proprietary rights of various systems. He is currently CEO, Rubiini (UAE); Hon. President, Worldwide Independent Inventors Association; Special Advisor, RTEAN; Director, MMNA Investments Limited. He had functioned as Chair, International Board of GCC Business Council (UAE); Senior Partner, Shevach Consulting; Chairman (Certification & Training), Coordinator (Board of Fellows), Lead Assessor & Governing Council Member, Institute of Management Consultants, Nigeria; Lead Resource, Centre for Competitive Intelligence Development; Turnaround Project Director, Consolidated Business Holdings Limited; Lead Consultant/ Partner, JK Michaels; Technical Director, Gestalt; Chief Operating Officer, Rohan Group; Executive Director (Various Roles), Fortuna, Gambia & Malta; Director, The Greens; Chief Advisor/Partner, D & E; Vice Chairman, Refined Shipping; Director of Programmes & Governing Council Member, Institute of Business Development, Nigeria; Member of TDD Committee, International Association of Software Architects, USA; Member of Strategic Planning and Implementation Committee, Chartered Institute of Personnel Management of Nigeria; Adjunct Faculty, Regent Business School, South Africa; Adjunct Faculty, Ladoke Akintola University of Technology, Nigeria; Editor-in-Chief & Chairman of Editorial Board, Cost Management Journal; National Executive Council Member, Institute of Internal Auditors of Nigeria; Member, Board of Directors (Several Organizations). He holds Doctoral Degree in Management, Master of Business Administration and Fellowship of Several Professional Institutes in North America, UK & Nigeria. He is an author & widely featured speaker in workshops, conferences & retreats. He was involved in developing Specialist Master’s Degree Course Content for Ladoke Akintola University of Technology (Nigeria) and Jones International University (USA). He holds Interim Management Assignments on Boards of Companies as Non-Executive Director.

Thank You