Intellectual (4)

Ideas Connect Us More Than Relationships

I was struck by this blog post today by Hutch Carpenter entitled Why Ideas are Core to Enterprise 2.0. He talks about all the hype about social media and asserts that it is really ideas that link communities together. He says:

Ideas have a unique quality in team and community forming, consistent with the emergent nature of Enterprise 2.0

One of the sources he quotes was Brian Solis and his post entitled Ideas Connect Us More Than Relationships.

I couldn't help but think of our ICKC community and what we are trying to do. IC is an important idea. I can't wait to see what we make of it here!

Cheers, Mary
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Entrepreneurs and Patents…

Michael D. Moberly   June 21, 2013    

There are and infinite number of interpretation to what is routinely referred to as what ‘the American dream’ and an equal number of paths how to achieve it.  The notion of ‘the American dream’ has certainly embedded in political rhetoric as one need only watch C-SPAN and listen to countless elected politicians consistently apply those three words to produce - elicit a myriad of emotions, imaginations as well as anger and frustration among their so-called target audience at the time.  The lingering effects of the 2008 economic recession are still very much evident in most sectors as many Americans and certainly citizens in numerous other countries struggle to find sustainable paths to surface from their own economic breakdowns.  Collectively, these persistent downturns has made first, retaining, and second, re-achieving ‘the American dream’, however one wishes to personally characterize it, elusive.

But, this piece is not about painting a new or conventional portrait of ‘the American dream’, rather it’s about the one twentieth of one percent of those individuals engaged in entrepreneurism and R&D who are seeking their version of ‘the American dream’ which often commences with making application for and hopefully having a patent issued for their work and achievement.

Due largely to the nature of my business consultancy, I encounter entrepreneurs of all stripes engaged in some truly remarkable endeavors.  These very purposeful encounters over the years have lead me to conclude that while there are numerous rationales for entrepreneurs to seek a patent for their idea – innovation, one rationale seems to repeatedly surface, which is, seldom are they familiar with, nor have they been apprised of options or alternatives to the ‘conventional patent route’.  Instead, I often characterize entrepreneurs as being singularly focused on seeking and securing conventional intellectual property, i.e., a patent.

There’s little doubt, being in a position to seek and possible secure a patent is indeed a privilege and achievement which very few others can put on their resume.  Further, in many instances, obtaining an issued patent will shine a well deserved light on one’s expertise and assign instantaneous credibility, short-lived as it ultimately may be among colleagues, peers, and even competitors.

Too, once a patent is issued it provides the holder with well deserved grounds for expressing pride in their labors, which in many instances have evolved over many years, depending on the product, testing, re-testing, etc.  Of course some do in a singularly boastful manner while others are far more humble and even self-deprecating in their characterizations.

But, I often find it puzzling, particularly with individual entrepreneurs, who, for the most part are very thorough, objective, and ‘driven’ researchers, why and how they readily gravitate to ‘going the patent route’ versus taking time to genuinely explore perhaps just as viable alternatives and/or options.

For the countless entrepreneurs I have had the pleasure of meeting over the past 25+ years, is their seemingly innate penchant for ‘going the patent route’ while conveying little if any awareness or interest in exploring alternatives to safeguard and commercialize their innovation against the realities of the increasingly predatorial global business environment in which any idea, patented or otherwise, is in a constant state of risk of infringement, misappropriation, theft, counterfeiting or a target of economic espionage.

As readers know well, there are numerous variables and influences that come to bear on entrepreneurs with respect to the path they choose for safeguarding and commercializing their original idea.  Aside from the demands made by would-be investors, including venture capitalists, angel investors, etc., one influential variable, I’m quite confident, even though I have never heard it specifically expressed in these terms, is that ‘idea holders’ opt for the patent route because they mistakenly assume that if/when a patent is issued, the stewardship, oversight, and management of their intangible asset (idea, innovation) becomes magically guaranteed, thereby relieving them of absolutely essential chores, which of course, is simply not the case!

I respectfully and admirably recognize possessing an issued patent represents for many entrepreneurs the ultimate ‘brass ring’ if you will, that will define, in many instances, one’s professional career.  Any assumption though that ‘going the patent route’ is the only option to achieve the necessary protection, and thus serve as the singularly best path to successful commercialization of an idea and possible profitability, is one that numerous professions and institutions wish to preserve and are not so courteous to those who want entrepreneurs to at least be exposed to equally viable alternatives.  To be sure, part of the challenge lies in the reality that there is no intangible asset strategist available to objectively articulate viable alternatives and objectively describe, with no malice, the reality that all forms of intellectual property, i.e., patents, trademarks, and copyrights have been the victim of some major hits in the past 20 years.

Let’s be clear, intellectual properties, i.e. patents, trademarks, copyrights, etc., are merely one type or category of intangible asset. The primary difference is that a patent, once issued by the U.S. Patent and Trademark Office (USPTO) or other countries’ counterpart, will assume a tangible/physical property only insofar the issuance letter one receives which can be framed and hung on an office wall as a testament of one’s persistent and challenging work.

Too, I suspect, respectfully so, that deference is often attached to patent (only) strategies by entrepreneurs due to the time honored, but flawed assumption that an issued patent conveys a more personal sense of ownership and certain legally defensible rights of protection, technically speaking, over say, a trade secret.

A constant source of nourishment to ‘patent only’ strategies is the widely held, but mistaken assumption that an issued patent constitutes a standalone deterrent to, or safe harbor from, would be infringers, misappropriators, counterfeiters, and economic espionage in general.  To that I say, in today’s increasingly aggressive, globally predatorial, and winner-take-all R&D and business transaction environments, ‘idea holders’ can be assured that depending on the nature and subject matter of their patent, it will likely be in a constant state of risk from a host of legacy free players, independent (information) brokers, and certainly state-sponsored entities engaged in economic (industrial) espionage.

Some years ago, I would characterize/frame the likelihood that an entrepreneurs’ idea, innovation (or patent) would be stolen, infringed, or counterfeited, etc., in the context of probabilities.  Since the early 2000’s, I believe I have taken a wiser and more reasoned and realistic approach by framing such likelihoods, not as mere probabilities, rather as inevitabilities if relevant precautions and safeguards are not taken that extend beyond the presumptive deterrents and safeguards in conventional intellectual property.  

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A new step in the development of our community

For many years I have had a great interest (some would say obsession!) about the role of intangible capital in the growth and competitiveness of companies. With the help of my colleagues, our clients and our broad network, we worked to develop  tools and methodologies to support this thinking. And we created this web community to share our learnings because we felt strongly that one person or one company could never have all the answers. Until now, the community was known as the IC Knowledge Center. Today, I am announcing a new future for our community with the re-launching of the site as smarter-companies

This new site will be designed around our existing community. To date, we have attracted an international audience. 60% of you are consultants. 20% are academics (many of whom also consult). The remainder includes attorneys, companies, non-profits, governments and solutions providers. Your areas of specialization include intellectual/intangible capital, knowledge management, human capital, innovation, finance, information technology, marketing, performance management and intellectual property.



In short, our community is like a map of the intangible capital of the organizations we serve. Yet the potential of our community’s IC, like that of many organizations, has not been fully developed. That’s why we’ve made the decision to re-name the community and create a business model around it.

Going forward, at smarter-companies, we will be offering the products and methodologies that we’ve developed over the last seven years (some as open source and some as paid products) under the ICounts name. But we hope that our products will be surrounded by products from other consultants and service providers. Our goal is for the smarter-companies site to become a place of continuous learning about how to create smarter companies—and also a marketplace of solutions that help consultants and companies apply that learning.

As we enter 2013, allow me to share my belief in a bright future. The ultimate message of intangible capital is that we share collective knowledge, much of it untapped, that has the potential to conquer the challenges facing the world and create profitable, sustainable businesses fueled by the power of people, communities and social technologies.

I hope you will join us on this journey,  Mary Adams


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10468392880?profile=originalI had a lot of fun on the IC for IP panel this week at the Intellectual Property Business Congress in Boston. The level of appreciation for the links between IP and IC weren’t too surprising. What was surprising to me was how much we ended up talking about accounting.

There are many cases of millions and billions worth of patents that had literally no value in the accounting until they are sold and suddenly, voila, there’s new value on the balance sheet that wasn't there before. One woman told the story of an acquisition that involved literally billions in patents and only 12 people. The financial people struggled to show why the value made sense. These huge shifts lead to greater and greater distrust of accounting.

But the most powerful discussions were about how the patents aren’t really the source of the value—it’s the knowledge and intangibles behind them. IP is a protection that facilitates the identification and the trading of value but you have to look beyond the IP to see (and ultimately monetize) that value.

One of my co-presenters explained it by contrasting two recent acquisitions by the same buyer, a mid-sized robotics technology company. Both came with a handful of good patents. Both sets of patents added to the company’s protective legal “moat” in their core technology areas. But one deal earned a very small price and the other a very high price. The Chief Legal Officer explained that the difference in price was due to the intangible capital that came with the intellectual property. The IC in this case was the team (human capital) and the systems (structural capital) and the connections (relationship capital) that came with the acquisition. The only element they didn’t “buy” was the strategic capital. In fact, he discussed at length the need for implanting the company’s culture into the team from the acquired company. Pure knowledge has a much more limited value than knowledge put to work. These differences were mostly booked to goodwill.

Discussions like these make it more clear to me than ever that we need to continue to create an alternate system. Not to replace accounting. But to complement it. And to get managers the information they need to manage their business and, ultimately, to manage their finances. Because companies spend a lot of money on intangibles. And they need ways to measure the effectiveness of that investment.

All this is why we started a movement for ICounting, to empower teams to create their own information sets about their intangibles. The main principles are the same: inventory and measure your assets. The difference is that we are inventorying intangibles and measuring them through stakeholder ratings. When you think about it, stakeholder usefulness is the ultimate leading indicator of profitability and the direct tie back to Accounting.

Ask your Accountant if they are learning ICounting. Hire an ICountant to help you. Learn the principles yourself with our open source tools. Some day, you’ll do all three. But don’t sit and wait for the system to change. Create a system that works for you today.

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