Leveraging Intellectual
Property Assets for
Business Success
Tamara Nanayakkara
Counsellor
Small and Medium Sized Enterprises Division
World Intellectual Property Organization
tamara.nanayakkara@wipo.int
Outline
The challenge of the new business
environment
 SME competitiveness
 IP and SME competitiveness
 Services provided by the SME
Division of WIPO

Old v New Economy
Industrial economy – focus on physical
goods. Dependant on natural resources
(finite)
 New economy – Greater reliance on knowhow, knowledge, human creativity and
innovation (infinite)


1950 knowledge component in manufactured
goods 20%, 1990s 70%

In 1998 intangible assets constituted 80% of
value of Fortune 500 companies.

“It is estimated that by 2007, as much as
90% of the value of the world’s top 2000
enterprises will consist of intellectual
property”

Building and Enforcing Intellectual Property Value,An International Guide for the Boardroom
2003PriceWaterhouseCoopers
New Economy

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Global market place
More demanding and fickle consumers
Shorter product cycles
Working through relationships and networks
Differentiating products
Selling an image, concept, idea
Out sourcing
Efficient use of resources resulting in lower
cost
Example
A pair of jeans bought in a street
market may cost US$ 10 while the
same pair of jeans bought in a high
end boutique will cost US$ 80. The
difference accounted for in the
intangible components in the latter.
 It is likely that the same (outsourced)
manufacturer produced both.

While a market continues to exist for
pure physical products (people will
continue to buy jeans) high profit
margins cannot be expected.
 High profit margins are possible when
there is improved efficiency, lower
costs, appealing and differentiated
products and services from reputed
sources.

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Globalization and trade liberalization has
made it crucial for SMEs to become
internationally competitive even when
competing exclusively in domestic markets
Application of knowledge, creativity and
innovation key in competitiveness
Competitiveness of SMEs

To be competitive SMEs need to constantly
improve their efficiency, reduce production costs
and enhance the reputation of their products and
services by:
 Investing in research and development
 Acquiring new technology
 Improving management practices
 Developing creative and appealing designs
 Effectively marketing their products and
services
The IP System
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Provides SMEs exclusivity over the
exploitation of their innovative products and
services, creative designs and brands
Thus creating an appropriate incentive for
investing in improving their competitiveness
Ensures a competitive market place, honest
trade practices and overall national
development
Intellectual Property Rights

Innovative products or
processes

Patents or utility models

Cultural artistic and
literary works

Copyright and related
rights

Creative designs

Industrial design rights

Distinctive signs

Trademark

Microchips

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Denominations of goods
attributable to a
geographical origin
Confidential business
information

Layout-designs or
integrated circuits.
Geographical indications

Trade secrets

Patents

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Gives the exclusive right to prevent others from
using the invention for a maximum period of 20
years
An invention could be a product or process
providing a new way of doing something, or a new
technical solution to a problem
It may lower cost, create efficiencies, enhance
performance, add new features etc..
Through exclusivity an opportunity is provided to
recoup costs and make a profit
Trademarks
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A sign that distinguishes the goods and
services of one enterprise from that of
another
Right to prevent others from using identical
or similar marks with respect to goods or
services that are identical or similar
Rights obtained through registration (or use)
Famous marks have greater rights
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Protects consumers
 They can differentiate between similar goods
 Information as to the source (quality,
reputation, trust)
Protects the company –
 Enables the company to build up a
reputation and a loyal clientele and thus a
market niche (brand)
Creates an overall competitive environment
which benefits society as a whole
Case Study on Trademarks
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An Italian businessman buys unmarked t-shirts
from manufacturers of generic clothing, attaches
his trademark (Pickwick®, which pictures a
rebellious-looking teenager) and begins to sell
them to retail stores
Started in a garage in the periphery of Rome
Today the Pickwick® trademark is perceived by
Italian teenagers as a synonym of style and quality
Pickwick® has began to export its products
across Europe
Its trademark is its most valuable asset
Interbrand 2006 Annual Survey
of the world’s most valuable
global brands
Coca-Cola: 67
Microsoft : 57
IBM: 56 b US$.
Industrial Designs
The ornamental or aesthetic aspects
of a product, that which distinguishes
that product from the competition and
makes the product appealing to a
consumer
 Right to prevent others from using
identical or similar designs

Design Rights
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Adds value to the product by making it more
appealing to consumers.
Some products (e.g. furniture) are primarily sold
on the basis of their appearance
Enables customization of products to specific
markets
Geographical Indications
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Goods that have a certain quality or
reputation due to the geographical region it
comes from
Generally pertaining to agricultural products
Examples: Bordeaux wine, Ceylon tea,
Gruyere cheese, Swiss chocolates,
Champagne, Colombian coffee
Protects local industries, preserves
traditional ways of producing and builds
regional reputation and image.
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Used by SMEs to jointly commercialize
products
Provides SMEs the opportunity to make their
products recognized by consumers,
distributed by the main distributors and sold
by the main retailers
Provides consumers certain quality
guarantee
Copyright
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Copyright law grants authors, composers,and
other creators legal protection for their creations
usually referred to as “works.”
It protects books, music, films magazines,
paintings, photographs, sculptures, architecture,
computer programs, etc
It gives an author or creator certain rights for a
limited period of time.
They are economic rights which enable the author
to control the economic use of his work and
moral rights, which protect an author’s reputation
and integrity.
Trade Secret
You may, either because it is not
patentable or because you prefer to
do so, keep certain business
information secret
 If you have taken reasonable steps to
keep such information secret and it
has commercial value by virtue of
being secret you may have trade
secret protection

Example – Coca Cola
Said to be the best kept secret
 Formula kept in a bank vault

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Can only be opened by a resolution of
the company Board of Directors
Only two people know the secret
Their identities are unknown
They cannot travel together
They oversee the production
Trade Secrets or Patents
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No registration
(costs/time factor)
Unlimited duration
No disclosure
Wider information
Difficult to enforce
No protection
against
independent
discovery or RE
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Registration
required (cost/time
factor)
Limited duration
Disclosure required
Limited to claims
Easier to enforce
Exclusive rights
One product many IPR
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Patent for the fountain pen
that could store ink
Utility Model for the grip and
pippette for injection of ink
Industrial Design: smart
design with the grip in the
shape of an arrow
Trademark: provided on the
product and the packaging to
distinguish it from other pens
Source: Japanese Patent Office
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Invention of CD player
protected by patent
Brand on CD player
protected by trademark
Design of CD player
protected by industrial
design
Music played on CD player
protected by copyright
Intangible to Tangible
By providing such protection the IP
system gives the owner of those
intangibles a right of exclusivity, the
right to prevent others from using
them.
 Bringing intangible rights closer to
tangible property

IP Policy
Beyond exclusivity – IP rights are not
only about exclusivity and the right to
prevent others from using and
exploiting them
 They are assets as important or even
more important than its physical
assets (buildings, machinery)
 Like any asset they must be
maintained, managed, exploited and
enforced.

IP Audit
Identify the IP assets of a company
 Have rights been acquired for them
 Are they been maintained
 Are they exploited optimally
 Is there any redundant IP
 Is there any infringement of third party rights

Exploiting IP Assets
Sale or License
 Joint ventures and strategic alliances
 Business format franchising
 Merchandising
 Better bargaining position in licensingin
 Defensive patenting, publication
 Collateral for finance

The inventor licensed the system to Coca-Cola at 1/10
of a penny per can. During the period of validity of
the patent the inventor obtained 148,000 UK pounds a
day on royalties
Franchise

A specialized license where the
franchisee is allowed by the franchisor
in return for a fee to use a particular
business model and is licensed a
bundle of IP rights (TM, service
marks, patents, trade secrets,
copyrighted works…) and supported
by training, technical support and
mentoring
Why enter into a Franchise
 Lower risk of failure
 Recognisable image
 On going support
 Easier to obtain financing
 Benefit from franchisors
R&D
Why not enter into a
Franchise
 All IPR owned by the
Franchisor
 Payment of fees
 Obliged to follow the
business model
 Innovations may be
assigned back to the
Franchisor
 Depend on the success
of the Franchisor
Merchandising

The licensing of trademarks, designs,
artworks as well as fictional
characters (protected by these rights)
and real personalities are broadly
referred to as merchandising
Why merchandise?

For the licensor
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Extend into new products
Increases exposure, strengthens image
(could also damage)
Revenue
Relatively risk free
For the licensee
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Increase appeal of its products
Relatively low cost way of gaining market
share
SMEs and IP
• Enterprises worldwide largely under-utilize the
intellectual property system due to
– Perceived lack of relevance of the IP system
– Perceived high costs and complexity of IP system
– Limited awareness of the IP system and its
usefulness
– Lack of qualified human resources to use the IP
system
What Can Support
Institutions do to Assist
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Awareness-raising and Training Activities
Technological Information Services
Financial Assistance
Customised Advisory Services
Assistance on IP Exploitation and
Commercialisation
• Diagnosis of the IP needs of the enterprise
(IP Audit)
WIPO SMEs Division
• Promote greater use of the IP system by SMEs and
enable them to make more effective use of their IP
assets
• Strengthen the capacity of governments to
develop strategies, policies and programs to meet
the IP needs of SMEs
• Improve the capacity of SME support institutions,
to provide IP-related services to SMEs
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Demystify
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Studies
Guides
Events and missions
Web site and newsletter
Multimedia products
Studies
• Studies on national policies on SME
development and the role of IP
– completed or under way in Argentina, Bhutan,
Mongolia, Nepal, Philippines, Sri Lanka, Tanzania,
Sierra Leone, Romania, Chile, Colombia, Costa Rica,
El Salvador, Honduras and Paraguay, Egypt, Morocco,
Lebanon
IP for Business Series
• Making a Mark
(Trademarks)
• Looking Good
(Designs)
• Inventing the
Future
• (Patents)
• Creative
Expression
(Copyright)
More guides
• WIPO/ITC Guides on:
– Marketing of Crafts and Visual Arts; Role of
Intellectual Property; A practical guide
– Secrets of Intellectual Property: Guide for
Small and Medium Sized Exporters
– Exchanging Value: Negotiating Technology
Licensing Agreements - A Training Manual
Events
• Special programs, seminar and workshops
organized by the SMEs Division in Geneva
in partnership with selected associations and
organizations
• Contributing to programs organized by
other divisions within WIPO and external
organizations
www.wipo.int/sme/en
• The Website of the SMEs Division is in six UN
languages (English, French, Spanish, Arabic,
Russian and Chinese)
• More than 200,000 pages viewed every month in
2007
• Contents include sections such as IP for Business,
IP and E-Commerce, Activities, Best Practices,
Case Studies, articles and publications
WIPO “Best Practices”
• WIPO collects information on policies,
programs and strategies that aim to encourage
a wider and more efficient use of the IP system
by SMEs
• Objectives:
– Identify experiences that have had a real impact in
making the IP system more accessible to SMEs
– Identify replicable mechanisms that may be
adapted to the institutional and economic context
of other countries
– Encourage exchange of experiences
Newsletter
• Monthly e-newsletter in the 6 UN
languages (Free)
• Content includes articles, updates with
information, links and documents
• Launched in August 2001
• Total number of subscribers: >25,000
IP Panorama
• WIPO, KIPO and KIPA have recently
released an e-learning product
consisting of ten modules on different
aspects of intellectual property from a
business perspective entitled, “IP
PANORAMA”.
Conclusion
• New (knowledge) Economy rewards those
enterprises that are creative, innovative and
understand the importance of the market for ideas
• The IP system provides the formal framework for
protecting their knowledge, creativity & innovation
• To maximize the potential provided the IP system
one has to think beyond exclusive rights to IP
assets
• IP offices, Chambers and other support institutions
have an important role to assist