IP Management Step 2: Identifying the Issues

“Managing” intellectual property means proactively creating value.  The collection of facts you generated in Step 1 will include a number of gems – opportunities for you to create BIG value.  These are the issues upon which you should focus your innovation.

You probably already identified some while doing your data collection.  It is common to have some Aha! moments (and I hope you noted your Aha! when it occurred – if not you’ll do it during subsequent projects).  To find more issues, try these three exercises.

First, look for the opportunities specific to your product, service, or process.

  • Evaluate how well your product performs for each of the stakeholder actions for which you’ve compiled a description of value.  Where does your product underperform?  That’s low hanging fruit for innovation.
  • What are the biggest gripes about your product?  These are clear opportunities.
  • What are the stakeholder actions that are the clumsiest, based on what stakeholders say?  Fix them and you add value.

Second, look at the market or industry.

  • What are the obvious market trends that you can take advantage of?  More low hanging fruit.
  • What are the challenges in your market that everyone has given up on?  Every market or industry has some “holy grail” that all competitors have stopped chasing because they believe it is impossible.  Don’t buy into the negative hype – these are great opportunities for innovative thinking to create huge value.
  • What directions are the major competitors moving?  Maybe you can move swiftly and get there first.  Maybe you can flank them.  Maybe you can leapfrog them.  Maybe it’s the wrong direction (based upon what your study of value has shown).
  • What directions are the new upstart companies moving?  Are they hitting the value points your study identified?  How will that affect the market?  What will the major competitors do?

Third, look outside your market and industry.

  • What are the best companies (no matter the industry or market) doing that is noteworthy?  Maybe you can adopt or adapt that.
  • What are the new inventions in other fields that may remotely touch your field?  Maybe you can adopt or adapt them.
  • What industry or market best fulfills some of the “holy grails”or unfulfilled value points in your industry?  Adopt or adapt.

You now have not only a collection of facts about value in your industry, but you have an identified list of the issues that can be most valuable for you to address.

Next: Inventing Potential Solutions

IP Management Step 1: Learn the Facts

For intellectual property to possess value, it must provide value for a company’s products, services, or processes – and they only generate value when they come into contact with people.  So, we first have to answer two questions.

  1. Who are the people who will touch the product, service, or process?
  2. What do they value?

Understanding value across your various stakeholder groups is where your intellectual property management system should start.  The general framework is simple enough: for each group of people that touch any particular product, service, or process, study and record what people value.

  • Internal departments
  • Key suppliers
  • Customer segments
  • Distribution channel
  • Service entities
  • Other partners or collaborators

How?  One on one interviews, observations, focus groups, customer service feedback, and so forth.  Ask about problems, ask about dreams, ask what they like, ask what they don’t like.  Have them describe a day with the product, have them demonstrate it to you, have them walk you through different things they do with the product.  Listen to gripes.  Ask why.  Ask for an explanation.  Don’t leave until you understand you understand how they work with and feel about the product.

The more stakeholder groups from which you learn and the more in depth you learn from each group, the more complete your knowledge.  Take good notes – this is the start of your intellectual property collection.

To organize this collection of facts, break all of the thoughts from those interviews, observations, and other feedback apart – and then categorize the individual thoughts.  One useful way to do this is to sort the comments by the action being performed.  So, for example, you end up with all of the retail merchandising comments together, all of the user interface comments together, all of the repair comments together, etc.

Congratulations.  You now have an organized collection of facts about what people value about your product, service, or process.

Next:  Identifying the Issues

Visible Intellectual Property Management

In a soon-to-be-published book, The Visible Business, Chris Pelz and I present a framework for how to develop a business strategy that has a direct line of sight from the facts surrounding the business, through the issues that the business faces, to the potential solutions for those issues, and finally to the selected and deployed strategy(ies).

The intellectual property management framework that I recommend,  Visible Intellectual Property Management, will generally follow those same principles.

  1. Learn the Facts
  2. Identify the Issues
  3. Invent Potential Solutions
  4. Select and Deploy the Best Solutions

The framework takes some inspiration from discussions I’ve had with a good friend, Jim Bradley, an inventor, problem solver, thinker, and multiple patent contributor who is retired from Navistar.  Over the past couple of years we have met for lunch periodically to talk about our common interest in innovation.  It was through those discussions that I discovered that innovation is just one subset of a larger system – intellectual property management.

The framework also owes a big debt of inspiration to Ron Sears of the Design Consortium.  I worked together with Ron for a few years and, like an apprentice, learned his Product Value Matrix (PVM)sm product development and innovation methodology.  Ron lives and breathes value creation, and his PVM process is the best process I know for producing innovation on demand.  Although I cannot borrow wholesale sections of PVM – a proprietary process – and present them to you,  I will sometimes direct you to the website pvmspec.com, where you can read about PVM in detail.  By the way, “Product Value Matrix” and “PVM” are service marks of the Design Consortium.

Many intellectual property management systems start at the point where a patent disclosure is made.  I now think that the point of invention is far too late to start managing your intellectual property.  It is at least as important, if not more important, to first understand the value system of your products, services, and processes before you start to invent.

Many companies would claim that the front end of understanding the value system is the responsibility and domain of a marketing department, while the back end of pursuing patent applications is an entirely separate process that is the responsibility of an intellectual property or legal department.  As you read my subsequent posts, you will see that I believe they are both part of the same process, and should not be treated separately.

Next: Learning the Facts

A New View of Intellectual Property Management

If you read yesterday’s post, you may have gone away thinking that I just bash patents 100% of the time.  Not true.  My position is that for the bootstrapped small entrepreneur who is implementing a clever, but probably not novel, business concept, a patent may not be in order.

But, I fully understand that some companies actively manage intellectual property portfolios in order to gain or maintain strategic advantage.  And they have hundreds of thousands of dollars, if not millions, to spend on management.  For these companies, I will be explaining in future innovation posts how they can adopt a broader and more valuable system of IP management.

Intellectual property management often starts at the point of a disclosure.  An employee invents or designs something that has merit to be novel and patentable.  The company determines if the cost of prosecuting a patent application is warranted (is the invention strategic, is it indeed novel, is there prior art, how much will it gain the company versus cost the company?).  Patent applications are filed, extensions are filed, variations are created, patents received are defended, etc.  The company owns a comfy bundle of strategic IP.

In a nutshell, I will be outlining a front end system that integrates with these current systems – an expanded view of what “intellectual property” is.  The system does two things:

  1. Provides and captures a strong market-based understanding of customer and stakeholder value.  The idea here is that if your company understands customers and stakeholders better than the competition, you are in a much better position.
  2. That greater understanding provides you the fodder to brainstorm  and innovate solutions that your competitors can’t envision. So, instead of waiting for some random event to produce a disclosure, and then hope that it is strategic and valuable, you create your own.  Inventions, that because they were borne of a deep understanding of value, are much more likely to be valuable parts of your IP portfolio.

No patent bashing, I promise.

To Patent or Not to Patent

This weekend I met with a group of inventors that I host every month at the Innovation Center.

Eventually, the discussion turned to patents and intellectual property.  A few participants seemed enormously concerned with protecting their property – making sure that patent applications had been filed before talking with anybody about anything.  One assumed that I felt the same, and while telling a newbie that he should first get a patent application filed, he said, “And Steve will tell you to get that going right away, too.”

Well, for some of the entrepreneurs I’ve worked with, like those in the orthopedic field, a granted patent is key to an exit strategy.  But, generally I DON’T agree that a patent application should be a staple in an entrepreneur’s plan, and I told them so.  Here’s why.

For most everyday entrepreneurs, there are five reasons why a patent application may not make sense.

  1. The likelihood of your idea being novel enough to result in some granted claims is slim.  I know – I just called your baby ugly.  But, face facts – you can have a great business concept that will make all sorts of money, and not be novel enough to warrant a patent claim.
  2. It costs money to find out if you can be granted a patent, money that at the early stage of a business is better spent on getting a product finished and ready to sell or talking with customers.  A good patent attorney can save you from filing for something that is clearly not novel – but his incentive is to make money and help you file something (for a fee).
  3. The same patent attorney that can help you file most likely also devotes part of his practice to helping people design around existing patents.  So the value of the patent you may some day receive may not be as great as you thought.
  4. Time is not on your side.  A patent application will take years to prosecute.  I’m hoping that you want to be to market WELL before that.  Why would you take time (and money, remember) from that process?  In the software, web, mobile, and computer technology fields, technology generations can turn over multiple times before you receive your grant.
  5. OK, let’s say that you do receive your patent.  And then some large corporation violates it (in your opinion, that is).  Do you have the funds to prosecute the violation?  Is your market (and net profit) large enough to warrant a long, costly lawsuit?

So, am I trying to be Mr. Doom and Gloom here?  Of course not.  I just want you to key on what is important – developing your product, talking with your customers, and gaining traction.