Date post: | 08-Apr-2017 |
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IP for Business
AdvantageByProf. Anil B. SurajBrain League IP Services Now BananaIP
© 2009 Brain League IP Services Pvt. Ltd.© 2009 Brain League IP Services Pvt. Ltd.
© 2009 Brain League IP Services Pvt. Ltd Now BananaIP.
Session Objectives
• To appreciate the growing value of innovative/creative behaviour
• To understand the contribution of protected IP in gaining competitive advantage
IPRs – General Bases• Economic (and technological) rationale
– aids overall development
• Social benefits – Public Domain and Basic Research
• Legal monopoly – fair regulation within territory
Forms of IPRs• Patents – Patents Act, 1970
• Copyrights – Copyright Act, 1957
• Trade Marks – Trade Marks Act, 1999
• Industrial Designs – Designs Act, 2000
Forms of IPRs …• Layout Designs of ICs
– Semiconductor Integrated Circuits Layout-Design Act, 2000
• Geographical Indications – Geographical Indications of Goods
(Registration and Protection) Act, 1999
Forms of IPRs …• Trade Secrets – Contractual – no
legislation in India
• Plant varieties – Protection of Plant Varieties and Farmers’ Rights Act, 2001
• Traditional Knowledge – partly by Biological Diversity Act, 2002
Principles of Traditional Management
• Organizing towards:– Perfect replicability & standardization– Ever-increasing scale– Incremental process efficiency
• Efficiency-productivity focus = growth?
• Vulnerability to Market cycles
Present Challenges• Accelerated consolidation - getting ahead first
and then to consolidate
• Value creation through pursuit of innovative achievements – to also overcome price-erosion
• Best practice – not always best strategy; Change need not wait for a crisis!
• Cost-conscious users/consumers – an unique opportunity in emerging economies
Offshore Outsourcing• Typically of three types:
– Captive entity – wholly owned subsidiary – IP is fully owned; but has other legal implications
– Joint venture – a new combined company – IP is based on the Shareholding Agreement
• BOT Model – involves transition risks– Contracting - with a local Supplier – Enforcement
with due diligence – e.g., Confidentiality; Parent-subsidiary relations
• Determining factors = cost, commitment, control, flexibility and liability models
Culture of Innovation• Short-term vs. Long-term goals – need to be
sustainable and balanced – R&D culture
• Granular level innovation to be fostered – what are the incentives – people and firms?
• Innovative organizational design – towards creating “thought-intensive” employees– Attracting high talent – and then to make higher
profits off them!!
IP for Competition …
Return on Innovations• Product variations; Incremental innovations; and Breakthrough
inventions– Breakthrough inventions have been found to be 6 times more
productive than incremental innovations
• Although the count of “new products” being introduced has risen globally; only about 5% of them are found to be significantly innovative
• What are the organizational concerns? Fewer inventions patented by Top-ranked Companies – efficient methodologies have become orthodoxies? In 1997 – top 10 Pharma Cos. = 34% revenues from selling products licensed from other companies
• Intangible assets – any day worth more than sub-prime assets!!
Collaborative efforts• Intellectual Property:
– to source, – jointly create, – timely commercialize, and – legally ownmarket oriented ideas
• Leveraging competitive assets; enhancing product lines; Competitive hedging; Strategic positioning (CDs)
• External perspective – vital for innovations– Open innovations through online communities– Market-makers and customer information aggregators– ASICs and The Patent and License Exchange (pl-X.com)
Collaborative efforts …• Skill-intensive sectors – India is now a
leading sourcing, manufacturing and research base– Process/Product/Capital reengineering and
redesigning – at low costs and high volumes– Economies of scope and scale– Auto parts, Electronics, Machine tools, Pharma
• “Technology partners” to be encouraged – balanced joint ventures have enriched Indian firms
Intellectual assetsKey Principles:
• Visibility and full exploitation
• Internal and external – pursuit of protection
• Ensuring ongoing access and freedom to exploit the intellectual assets
Intellectual assets …Key Issues:
• Prospect of reverse engineering
• Likelihood of aggressive action needed to protect IPRs
• Role of Intellectual assets in business alliances and joint ventures
Intellectual assets …Key Issues:
• Identifying the key geographical areas – for marketing and registration of IPRs
• Study the level of innovative behaviour among the competitors; and suppliers
• Role of “House brands” – towards building brand equity
Intellectual assets …Key Actions:
• Must portray the differentiating and enabling qualities of intellectual assets– IP that must be owned; and IP that is needed
(therefore could be sourced)
• Strategic Licensing to form a key component of business plans – inward and outward – competing by collaborating
Key issues in Contracting
• Confidentiality – specific & assertive
• Non-compete and Exclusivity – limited and only under “reasonable” conditions
• Liability – clear exemption standards
• Termination clause – ownership issues
IP issues in Contracting• Sharing regime + sustained ownership
• Disparities in applicable laws & IP rights
• Identify, define and document – processes and products
• Due diligence & IP Valuation
IP issues …• Enforcement – involves local issues too
• Employer-employee relations – framework of trusteeship
• Data protection and security
• Third party liability – e.g., ISPs
• Dispute settlement and arbitral enforcement
IP Licensing strategies• Monetary gains• Cross-licensing: bargained access• Cross-licensing (with competitors): to avoid
litigation• To establish an industry standard – transfer
of technology with academic entities• Sharing of risks and uncertainties• Provides faster/wider market access• Protection of know-how• Better understanding of IP markets• Provide for bankruptcy of the other party!
IP Licensing …• Only 5% of Patents are being licensed – of
which not more than 1% generates revenue
• What about patenting strategy?– Visibility of infringements to ensure protection
• Stage-Gate processes for Intellectual Assets in a company: periodic review based on a sound plan
If we do not use IP …
Thank You!