In this ninth and final article, Steve Potts looks at Intellectual Property – building value in your business and protecting your rights
As you build your managed services offering it is important to both protect the business and, if your personal strategy includes exit, build the value into your business.
What is Intellectual Property?
Intellectual Property lets people own the work they create. It is an intangible asset that can have a significant value. It covers four main areas of creativity, innovation and invention as well as being implicit it in some of the most mundane aspects of your business. It delivers both risk and opportunity to ALL businesses large and small. Ignore it at your peril!
Why is it important to my business?
The modern digital age has seen a considerable growth in the Intellectual property business. The US and the UK lead the world in this field followed by the EU and then the emerging economies like China and India.
There is rapid growth and the recognition of the importance of intangible assets alongside traditional capital assets.
The intellectual property industry has recently been valued at
- Patents Ideas £60bn
- Design Aesthetics £30bn
- Trademarks Brands and Logos £12bn
Three reasons for having a clear defined and documented IP strategy:
Intellectual property is an intangible part of the value of your business. It will have a major impact on your existing strategy, your funding strategy and, if you get into difficulties, it could help keep you afloat.
For example, the way you do things, your database of customers the content of your website are all tangible assets that will add to the net worth of your business should you decide to exit.
The lack of an Intellectual property strategy may well expose your business to significant risk from unexpected litigation, competitors, subcontractors and even employees/former employees.
For example, if you outsource any creative work, you need to ensure that the contract states that you retain any IP created during the contract period.
A well-considered Intellectual Property strategy will protect your business from unexpected competitive attacks, unwittingly infringing other peoples' IP or protect you from unexpected litigation. Having a strong IP policy has been proven on several occasions to have protected business from being closed down.
What do I need to protect my IP?
- Invest some time in understanding in greater depth what intellectual property means for your business.
- Make a judgement on which aspects of IP are important to protect and enhance your business.
- Draw up and implement an on-going IP strategy
- Protect your intangible assets and add significant value to the net worth of your business
Food for thought - potentially 80 percent of the value of your business could be tied up in Intellectual Property. The more you protect it and can provide evidence that it is protected the more value there is in your business.
Do you understand it, do you own it, do you protect it or are you at risk?
You can find out more about this topic here http://www.ipo.gov.uk/
Work through the intellectual property in your business and decide how best to protect it – think about trade marks, software that you may have written, any scripts that you have produced, anything that can be protected You may need professional advice on how best to proceed – the cost of any advice required could well be one of the best investments you make if you need to either sell your business or to raise additional funding.
Steve Potts is director accountable for growth at Transmentum
Article 1. Controlling the wheel of fortune
Article 2: Strategy: The Foundation of Growth
Article 3: A sales strategy for accelerating growth
Article 4: Marketing and Your Proposition
Article 5: Help Desk - a profit centre or a cost?
Article 6: Six factors in customer retention
Article 7: Vendors: Suppliers or partners?
Article 8: Building a product and services strategy