Best practice for intellectual property management
What is intellectual property?
Intellectual property is a term that refers to intangible assets owned by a company.
Such items include:
- Patents (e.g. for a software program)
- Copyright (e.g. for a book, screenplay, or piece of music)
- Trade marks (e.g. a logo or phrase used to differentiate a product from those of competitors)
- Design (e.g. the look of a car or fashion item)
- Trade secrets (e.g. the recipe for a new beer or an investment firm’s list of clients)
Intellectual property is the result of creativity and innovation from the organisation producing it. While different from physical items (like buildings or machinery), intellectual property may be just as important to a business’s profitability.
Like with physical assets, intellectual property enjoys legal protection to safeguard the interests of its owners. In some cases, this is automatic. In others, it must be applied for and renewed periodically. The level of protection also varies between different types of intellectual property.
Given the importance of intellectual property, it is vital that companies have rigorous procedures in place to ensure they realise the full potential of such assets.
We look below at what constitutes best practice when it comes to managing intellectual property. This is a complex issue, however, and it is recommended those with concerns seek advice from experts.
Trademark Eagle has a wealth of experience in this area and is happy to provide the guidance you need to safeguard your intellectual property.
How can intellectual property management protect your business?
Intellectual property management can play a crucial role in ensuring the future success of a company. Whether it be a successful brand (e.g. BMW, Microsoft, Tesco) or a portfolio of bestselling novels, intellectual property can be worth vast sums of money over the years.
It is imperative, therefore, that businesses manage intellectual property effectively to exploit its full potential and prevent competitors from unfairly benefiting from the time, money, and expertise that has gone into creating it.
An effective intellectual property management system will track and record all the assets a company possesses and ensure that measures to protect and utilise them are built into the organisation’s operating procedures.
Specific ways in which this can benefit a company include:
In creating a new product, a company is striving to launch something that will stand out from similar items on the market and so have a competitive edge. Being aware of the trademarks and patents that the company holds may provide the opportunity to produce something which no rival business could legally manufacture. Effective intellectual property management procedures can ensure trademarks and patents are used to their full potential by their rightful owners and that rigorous action is taken against any competitor that tries to infringe such rights.
Having put in the effort to build up a brand that resonates with the public (through its name, logo, advertising slogan, product design and so on) it is important this competitive advantage is fully utilised in subsequent marketing campaigns.
By being fully aware of all the intellectual property it holds, the company can make an informed decision on any assets that it no longer requires. Such property can then be sold or licensed to other organisations.
Reducing tax liabilities
Managing intellectual property effectively can also provide important tax benefits. For example, should a trademark or patent be deemed to have a certain monetary value, each year a portion of that value can be offset against revenue when it comes to submitting the company’s annual tax return, a process known as amortisation.
Avoiding legal issues
In addition to preventing competitors from unfairly exploiting a business’s intangible assets, an effective intellectual property system can ensure the business does not inadvertently impinge on someone else’s rights. Doing so could have severe consequences, including civil and criminal legal proceedings, and reputational damage.
What are the best practices for intellectual property management?
Best practices for managing intellectual property include:
Ongoing employee training
To ensure that intellectual property management remains central to a company’s operations, all relevant staff should receive ongoing training on the subject so they are aware of the organisation’s legal rights and obligations on the issue and how they can support the business in their day-to-day activities (e.g. through the use of non-disclosure agreements when working with external parties).
Intellectual property inventory
The company should compile and regularly update an inventory of all intellectual property assets. Such a database should also include details of the legal protection that is in place, how long this lasts for, and if and when action is required to renew it.
Instigating intellectual property procedures
Managing intellectual property effectively requires having rigorous systems in place so that, for example:
- any applications for legal protection are made at the earliest opportunity
- staff working in areas such as product development, marketing, legal and accounts are aware of the intellectual property relevant to their role and how to access it
- employees are aware of intellectual property held by rival businesses so that they do not inadvertently infringe upon it
- intellectual property is regarded as a crucial part of an organisation’s strategic planning (e.g. if considering making an acquisition a company may target a business that holds complementary patents to its own)
- taking early action to stop unauthorised use of trademarks or patents prevents damage to the intellectual property rights. Damage includes loss of sales to competitors, tarnishing of your brand by poor quality products or poor service and dilution of rights.
Proactive approach to legal issues
In the case of a company’s competitors using your intellectual property without permission or accusing the company itself of infringement, it is strongly recommended you seek legal advice as soon as possible.
Where can I find out more about intellectual property management?
Trademark Eagle has a proven track record when it comes to providing advice and support over all issues concerning intellectual property management. Our expert team can guide you through the process to ensure you make the most effective use of your own property while avoiding issues concerning the assets of others.