Sometimes patents can provide little or no value for a business. They wind up being merely a cost burden. Can organisations avoid generating unwanted IP? For the most part, yes. Of course this entails knowing the common underlying causes and acting to address them. It may require more time and attention than has previously been allocated within your business but the advantages are so far reaching that it’s worth the investment.
There are 3 main causes for the development of unwanted IP
1. Future Uncertainties
2. Unclear Directions
3. Tangential Motivation
Future uncertainties exist in most businesses. When there is no clear understanding within the organisation regarding its present and future goals, this is self-added uncertainty. Inability or lack of investment in predicting market requirements and an uncoordinated IP effort within the organisation as a result of external uncertainty can spell disaster for a business.
Initial project conception
The initial period of project conception is a high risk time for uncertainty and common uncertainities are those regarding priorities, budgets, deliverables, timelines etc. It pays to study your market, define your goals, and clarify your processes for achieving those goals.
Fast paced industries
Risk of future uncertainty is also high in the fast paced industries where technology developed yesterday becomes obsolete today. In addition to or as an alternative to patents, other forms of IP such as copyright, design, and utility models must be explored and used to protect novel aspects whenever feasible. Some jurisdictions allow patent of addition for improvement or modifications of the parent invention. These can be filed by the applicant or patentee or someone who has consent from the applicant or patentee and provide a very useful way of protecting incremental inventions.
Another common and costly area of confusion relates to market selection. “Know your market well” is the key to success. IP is territorial in nature. Some inventions might be too weak to survive examination or risk frequent and possibly un-survivable attack in some territories. Patent enforcement might be weak in some countries or your patent monopoly may not survive against public interest policy in some jurisdictions. Some questions worth considering are:
- Is your invention patentable in the market you choose and if so, will the patent be enforceable? Is launch of your invention (while patent has not been granted yet) worth pursuing in this market?
- Does local competition, partnering opportunities, distribution chain, local pricing, logistics and so on make the market a favourable one for your product or service?
- Do projected profits justify the expense and risk of entering the market?
Of course sometimes despite the best research and planning there are unforeseen events that you can’t control or factor in to your filing decisions. On ocassion patents will inevitably wind up being less valuable than originally anticipated, and so arises the need for regular portfolio review and culling. (Watch out for our post on the IP mistake 35 – failure to abandon IP.)
This subject relates more to the environment within the organization. Lack of IP strategic reviews is one of the main reasons for building unwanted IP. Undecided priorities, inadequate or over-burdened IP staff can be some of the reasons why IP reviews are not done before filing. The role of IP is not only to give the go-ahead for filing but also to check what is being filed. Summaries provided by inventors often require more questioning and sometimes more technical support. Companies should have well defined systems to cover the step of IP review for all inventions.
Lack of communication within the organization can also increase the risk of developing unwanted IP. Good business and IP strategies rely on great communication from top to bottom and across the business. Cross departmental meetings allow people from cross disciplines to work together, share thoughts, check feasibilities and reconcile ideas that are vital for understanding requirements, aligning efforts and generating IP to match the business goals.
Lack of IP reviews and lack of communication may result not only in filing something which should not have been filed but also filing too early or too late. Both these IP mistakes can have serious ramifications which can ultimately result in patents that are of little worth to the business (see our earlier IP mistake posts regarding Filing to Early and Filing to Late).
Losing key people involved in research may also harm the quality of the IP produced. This may happen during the time gap while going from provisional filing to complete specification filing, during prosecution and during post grant proceedings. This may cause uncertainties and lead to unwanted IP if inventions are not captured in essence. One way to tackle this is to keep excellent records of the experimental data, to enter comments, to write down why a particular experiment is designed and to conclude what is confirmed after the work is done.
Tangential motivations of the organisation or individuals within can also undermine efforts to develop quality IP.
Sometimes patent filings are done to avail certain provisions made under National Laws. For example some countries have enacted drug price control (DPC) in order to control cost of medicines. The patented drugs, formulations and processes are exempted from DPC. Sometimes companies file patents to avail such provisions without thought being given to whether such IP would be required in long run. The same situation can appear when a government introduces certain schemes to promote progress of science. Sometimes the cost of patent filing is at least partly covered and companies, while trying to avail such provisions, may not pay attention to quality of patents. Also, critical thought process which is required behind patent filing is absent.
Another motivation can be filing more and more patents to achieve filing targets which an organisation may have set. While doing this many table patents might be filed. Table patents are those which are filed without adequate experimental work where most of the things are assumed to work for a particular product or process. For example while filing a patent on a new process for a particular product, scientists may become tempted to file it for other products as well without actually checking how the new process works for another product. Such table patents may either not work or require significant modifications.
Tangential motivations may also include the desire of people within an organisation to earn reputation through filing more patents. Some people from higher and middle management are enticed with the thought of enhancing the value of their resume by adding more and more patents to their name. Market analysis and business strategy may not be adequately considered leading to generation of unwanted IP that cannot be put to any use.
It might seem difficult to tackle tangential motivation within an organisation but the best start is to maximise IP awareness through staff education programs and establish incentives for the creation of IP value, rather than IP per se.
Removing uncertainties, defining strategic goals and defining a path to success is an ongoing dynamic process. It requires a holistic perspective and a cohesive team effort between business departments. If you have ever looked at your IP portfolio and wondered why so many patents were filed that today seem to provide no value for you, take a step back and look at the bigger picture. Creating valuable IP depends upon it.
(This is number 33 in our list of IP mistakes and how to avoid them.)
Image credit: neate photos