An idea, by definition, exists primarily in one’s mind, where it remains somewhat safe, but not very useful as long as no one else knows about it. To produce (business) value from that idea, it must be expressed, and therein often lie the starting points of many potential problems and challenges for the creators, the developers of that idea.
Fundamentally, the protection of the property rights of the products of the mind represents a kind of contract between the society, the government and the people who created/developed the idea.
But, the risks (threats, vulnerabilities) to ideas (information assets) today, e.g. compromise, theft, misappropriation, infringement, counterfeiting, etc., are asymmetrical, rapidly changing, and when they occur, can instantly:
. stifle the drive for further development and/or (economic)
idea marketing
. undermine projected transactions, investments, strategic (business) plans or
competitive positioning and
. erode (evaporate) the value of ideas and projected (future) use, profitability or
anticipated competitive advantages.
In the pre-Internet era, when the business experienced compromises/loss in its confidential proprietary information and/or trade secrets, etc., a common strategy/practice was to try to contain (compartmentalize) the damage and/or the extent of loss, usually in a context of business continuity/contingency planning. However, today, while such strategies may be feasible in limited circumstances, they rarely reflect the reality of the ‘nanosecond speed’ in which valuable information assets can be acquired and globally disseminated to an ever-growing variety of adversaries, e.g., infringers, competitors, counterfeiters, etc. And, once the asset has been successfully compromised, reliance on containment, in the conventional sense, is rarely a viable option.
The widespread availability of ultra-sophisticated and predatory data mining, scanning and analysis (competitor intelligence) tools (software) (software programs) that can discern and extract substantial advantages embedded in a company’s information assets and ultimately distribute them to a growing maze of highly organized, skilled information intermediaries and global corporate and state-sponsored economic-competitive adversaries, increases (exacerbates) the likelihood that see compromised This makes a company’s proprietary information assets at risk (vulnerable) 24/7, and at ever earlier stages of (their) development and without regard to conventional intellectual property protections.
Thus, while conventional IP enforcement mechanisms (i.e. patents, trademarks, copyrights) remain a highly nuanced and country-focused requirement for transferring ownership and providing legal standing to address potential disputes and challenges, the reality is that patents in particular are reactive, that is, they require constant self-monitoring and control by the owner/holder to be even reasonably effective.
Equally important, the alleged deterrent effects of IP (eg filing: issuing a patent, for example, will prevent others from stealing, infringing, counterfeiting and/or misappropriating) are (a.) conceptually and virtually oversold, and (b.) easily/easily outmatched, unadvertised and completely ignored by a growing global framework of ‘legacy free’ players and well-organized information brethren. kers, violators and counterfeiters.
Legacy free players, as characterized by Thomas Friedman (The World Is Flat), are individuals, organizations (globally) who generally have, for a variety of reasons, little or no cultural, national heritage to respect (tangible) private property rights, let alone intellectual property rights. Thus, legacy free players can blatantly engage in theft, misappropriation and (economic) industrial espionage to acquire the ideas, intellectual property and proprietary knowledge of others to improve their position (economically, competitively) and without incurring the (huge) upfront costs associated with “idea development” (R&D).
Arguably, then, in the increasingly predatory, aggressive and winner-take-all global business (transaction) environment, conventional forms of intellectual property are rapidly becoming less relevant, perhaps even obsolete, as (a) the primary ‘tool’ for safeguarding a company’s most valuable assets, (b) ensuring that the rightful owner receives the benefits of economic and competitive advantage from hard-earned and costly knowledge as it has been developed, or (c) ensuring control, use, ownership and value of its intangible assets and intellectual property that are at stake – part of a transaction.
That is, in many transactions (where a company’s intellectual property and intangible assets are at stake, as part of a deal), one can today assume that all or a significant part of the value of those assets and the functional-commercial life cycle will be significantly reduced, if not completely lost (irrecoverable).
Unfortunately, the new business reality is that conventional IP enforcement produces little benefit for an organization, other than providing a (legal) position for dispute resolution and/or initiating litigation when challenges arise, which is happening with increasing frequency and consistency. That is not to say that conventional IP protections should not be used. However, any assumption that the issuance of a patent, alone, will be sufficient to absolutely deter (inhibit) infringement, product piracy, misappropriation or theft and allow the rightful owner/licensee to maintain unencumbered and unchallenged control, use, value and property rights for 20 years is not a credible, viable or prudent course of action.
Therefore, today it is imperative that those responsible for the decision -making of the company (holders, intellectual property owners and intangible assets, patented technical knowledge, commercial secrets, etc.) practice an administration, supervision and management coherent and effective of those assets, which includes (a.) Monitor their status, stability, fragility and sustainability, so that (b.) aggressively pursued in a timely way (in real time).
Even in light of the economic fact, the business reality in which more than 65% of value, revenue streams and future wealth creation (sustainability) for most companies are directly related to intangible assets and IP, a significant percentage of company intangible assets are unrecognized and undervalued. This is especially true when a company’s know-how (intellectual capital) has literally been embedded into its products, services and processes over many years, as a “business culture” that often goes unnoticed and underappreciated insofar as it contributes to quality, consistency and sustainability.
Ultimately, the probability (chance) that a company will experience a compromise, breach or loss of its IP, intangibles and/or proprietary competitive advantages and know-how should not be characterized as merely representing another ‘risk of doing business’. Rather, in today’s global business environment, it more closely resembles an inevitability that, if dismissed or left unchecked by company decision makers, senior executives, boards and D&Os, can constitute not only a breach of fiduciary responsibility, but also lead to significant and unrecoverable losses.