STRATEGIC APPROACH PAYS OFF

The IPR approach of a company affects several key figures. Trading IPR (i.e. entering into licence agreements), new knowledge management processes and clear IPR goals adapted to the business strategy will affect the financial results of a company in a positive way. This is the main conclusion of new research on Danish companies conducted by Lars Alkærsig, Technical University of Denmark, Karin Beukel, University of Copenhagen, and Toke Reichstein, Copenhagen Business School. Their overall findings are the subject of a new book ‘Intellectual Property Rights Management – Rookies, Dealers Strategists & Strategic Dealers’ (Palgrave Macmillan 2015).

THE RESULTS DEPEND ON THE TYPE OF COMPANY

Companies can work with IPR at different levels and with varying degrees of financial success. In the book, four company types are defined, all of which work with IPR in different ways. The types have been identified by comparing questionnaire responses from more than 3,500 Danish companies. Here you can read about the characteristics of the companies in each of the four categories.

IP ROOKIE

The IP Rookie is defined as a company that neither trades with IPR nor has a strategic IPR approach. This company type is characterised by having limited IPR resources and experience. IPR efforts are ad hoc in nature and the company often does not have a dedicated IPR budget.

IP DEALER

The IP Dealer has experience in trading IPR but lacks a strategic IPR approach. Thus, trading IPR is ad hoc and for many companies, the opportunity presents itself randomly. The IP Dealer rarely sees IPR activities as being important to the company.

IP STRATEGIST

The IP Strategist is a company type with a strategic IPR approach, but no experience in trading IPR. It is characterised by having dedicated IPR resources and views IP as an important tool for protecting investments in product development.

IP STRATEGIC DEALER

An IP Strategic Dealer is a company type that has experience in trading IPR, a focused IPR strategy and who is characterised by a concerted IPR approach. The company has appointed an IP manager and the entire organisation is involved in the IP effort. The company uses a combination of IP rights to ensure a strong market position.

Main conclusions of the study

Companies with a strategic approach to IPR and/or who engage in IPR trading perform better in relation to a number of financial parameters. This means, that companies can strengthen their financial results through a more active IPR approach. The research findings reveal some interesting correlations:

Companies that neither have a strategic approach to IPR nor engage in trading IPR perform worse in the areas of revenue, gross profit and value added compared to similar companies that have an active IPR policy and/or engage in trading IPR.

Companies that only have few IP rights can perform among the best if they use those rights in the best possible way. This means that the analysis shows no advantage alone owning many rights.

Companies that engage in trading IPR perform better on virtually all measured parameters compared to companies that possess IP rights but who do not engage in trading IPR.

Overall, there is a clear advantage in belonging to the segment engaged in trading IPR – and the advantage increases if the company also has a strategic IPR approach.

Intellectual Property Rights Management

- Rookies, Dealers and Strategists

Palgrave Macmillan, 2015

Authors: Karin Beukel (University of Copenhagen), Lars Alkærsig (Technical University of Denmark) and Toke Reichstein (Copenhagen Business School)

Introduction: Suzanne Harrison