Strategic Use of IP for Business
in Knowledge-driven Economy
May 2009, Seoul
Dr. Guriqbal Singh Jaiya
Director
Small and Medium-Sized Enterprises Division
World Intellectual Property Organization
www.wipo.int/sme
Spotlight is on knowledge
in today’s economy
• Knowledge, Weightless, Information, Digital or
Service Economy
• Factors of production: Land, Labor, Capital,
Intangibles (Knowledge)
• Knowledge as useful Information (or Service)
• Information as a “Public Good”
• Information as Property
Market-oriented Economy
• Playing Field: Unfair competition; free riding
• National Legal Systems: Diversity
(bilateral/regional/ international treaties or
agreements)
• Adding Value : Meeting or exceeding market
needs or expectations
• Market research: Consumers’ needs, competing
products or substitutes, gaps
• Technological innovation as an element of
marketing
Performance Gap
Time
Customer Expectation Dilemma
Tangible and Intangible Assets
• Intangibles differ from tangibles in two
ways that “change the rules of the game”,
(if not the game itself):
– Value in context
– Multiple simultaneous value streams
Tangibility Spectrum
Salt
 Soft Drinks
 Detergents
 Automobiles
 CosmeticsFast-food
 Outlets

Tangible
Dominant

Intangible
Dominant

Fast-food
Outlets
Advertising
Agencies
Airlines
Investment
Management
Consulting
Teaching




The challenge
Performance
Selling
products
Selling (parts of)
interconnected
systems
Time
Strategic Entrepreneurship and
Innovation
• Entrepreneurship is concerned with:
– The discovery of profitable opportunities
– The exploitation of profitable opportunities
• Firms that encourage entrepreneurship are:
– Risk takers
– Committed to innovation
– Proactive in creating opportunities rather than waiting
to respond to opportunities created by others
Understanding the Process of Innovation
The Process/Steps of Innovation
Pre-IPO
$
Expansion
• Legal Entity
• Viable
• Market acceptance
• Heading to IPO or M&A
• High Growth
• Founders = Mgt Team
• Bright Idea
• Head Count
• Minimal Revenue
• Experimental
Start-Up
• Multiple Cycles
• Slow Growth
• Research
• Support Functions
• Business Plan
• Administration
Seed
• Proof of Concept
• Marketing
• Revenue Growth
Idea / Concept
Time
The Needs of Each Stage
$
•Recruitment
•Business
•Corporate and
Development
Secretarial
•A & P
•Financial
•Market Access
•Training
•PR and Marketing
•Networking
Expansion
•Business
•Business Plan
Development
•International support and
•Prototype/ POC
Mkt. Access
•Project Management
Start-Up
•Diversification strategies
•Business Premises
and support
•Project Management
•Recruitment
•Management Training
•Training and Incentives
Seed
Idea / Concept
Time
IP Management Needed in all stages
Understanding the business/role of IP
Patent
Manufacturing
Distribution
Sales
Brand
• Understand the value chain of the business and industry
• Understand how profits are generated
– primary product
– spare parts and related products
– service and maintenance
• What are the important features of the IP? How does it add value to the
business?
• What are the important features of the industry other than IP?
–
–
–
–
other important intangible and tangible assets in the value chain
competitive structure of the industry
customer characteristics and purchasing criteria
substitute products or services
IP Environment
Other Competitors
Established Leader
Disruptive
Technologies
Suppliers
You
Customers
Converging
Technologies
Complimentors
IP Deployment Continuum
Concerns
|
• IP risk balance
favors target
• Goal: Design
Freedom
|
MAD
|
|
|
|
Opportunity
|
• Balanced IP risk
• Goal: Confirm
MAD
|
|
|
|
• IP risk balance
favors You
• Goal: Identify value
generation
opportunities
Aligning Capabilities
Vision
Strategic Framework
IP Objectives/Roles:
Strategies
Innovation
Strategies
Value
Creation
Cash Value
Value
Extraction
Positioning
Value
Where does Intellectual Property fit into this?
An Aspect of Good Management
• People Management –
because IP is generated by people and used by
people
• Knowledge Management – because a lot of knowledge is informal and
may or may not crystallise as
recognisable category of IP
• IT Strategic Planning –
because a lot of IP is IT-related; some
of the more complex IP issues arise in
IT context
• Contract Management –
because IP is often created (or improved) in
context of a contract (eg, supply contract or
joint venture relationship)
• Asset Management –
because IP is an asset, albeit intangible; it has
a value
• Risk Management –
because there are risks to an organisation
flowing from its actions, or failure to act, in
relation to IP (including risk of lost
opportunity)
Introduction to IP Management 1
•
•
•
•
•
•
Legal
Technical
Business
Export
Financial
Relationships
•
•
•
•
•
•
Accounting
Tax
Insurance
Security
Automation
Personnel
Introduction to IP Management 2
•
•
•
•
•
•
•
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Trademarks (Brands)
Geographical Indications
Industrial Designs
Patents and Utility Models
Copyright and Related Rights
Trade Secrets
New Varieties of Plants
Unfair Competition
Bringing it All Together
Example No. 1
• Decades ago, Coca-Cola decided to keep its
soft drink formula a secret
• The formula is only know to a few people
within the company
• Kept in the vault of a bank in Atlanta
• Those who know the secret formula have
signed non-disclosure agreements
• It is rumored that they are not allowed to
travel together
• If it had patented its formula, the whole
world would be making Coca-Cola
Bringing it All Together
Example No. 2
• Patent for stud and tube coupling
system (the way bricks hold
together)
• But: Today the patents have long
expired and the company tries
hard to keep out competitors by
using designs, trademarks and
copyright
Bringing it All Together
Example No. 3
• Patent for the fountain pen that
could store ink
• Utility Model for the grip and
pipette 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
Bringing it All Together
Example No. 4
® Registered Trade Mark
‘TM’ Unregistered
Registered Design
Copyright: Labels & Artwork
Patents: Several dozen!
Basic Message 1
IP adds value at every stage of the value chain
from creative/innovative idea to putting a new,
better, and cheaper, product/service on the market:
Trademarks/ GIs
Ind. Designs/Patents/Copyright
Patents /
Utility Models/Trade secrets
Patents /
Utility models
Invention
Commercialization
Marketing
Financing
Literary / artistic
creation
Copyright/Related Rights
All IP Rights
Industrial Designs/
Trademarks/GIs
Product Design
Licensing
All IP Rights
Exporting
Basic Message 2
• IP Strategy should be an integral part of the
overall business strategy of an Enterprise
• The IP strategy of an Enterprise is influenced by
its creative/innovative capacity, financial
resources, field of technology, competitive
environment, etc.
• BUT: Ignoring the IP system altogether is in itself
an IP strategy, which may eventually prove very
costly or even fatal
Website of SMEs division
IP for Business Series
Published
• Making a Mark
(Trademarks)
• Looking Good
(Designs)
• Inventing the Future
(Patents)
• Creative Expression
(Copyrights)
developed by KIPO, KIPA and WIPO
Basic Modules
1. Importance of IP for SMEs
2. Trademarks and Industrial
Designs
3. Invention and Patent
4. Trade Secrets
5. Copyright and Related Rights
Advanced Modules
6. Patent Information
7. Technology Licensing in a
Strategic Partnership
8. IP in the Digital Economy
9. IP and International Trade
10. IP Audit
http://www.wipo.int/sme/en/multimedia/
WIPO SMEs Web-Site
“www.wipo.int/sme”
“IP for Business Series” in Publications
“IP Panorama” in Multimedia
“E-NEWSLETTER”
Guriqbal Singh Jaiya
guriqbal.jaiya@wipo.int