A panel of IP experts discuss aligning IP with business, how the role of IP in a business has changed, and whether IP can actually lead a business.
On 10 November 2020, a panel of IP experts from a variety of backgrounds with a wide range of expertise sat down with Leaders League and a sizeable audience to discuss how IP has been redefining business success.
The panelists were Tove Fabritius de Tengnagel, Project Manager of Corporate Patents at Danish pharmaceutical multinational Novo Nordisk; Maximin Gourcy, Group Intellectual Capital Manager at British packaging multinational DS Smith; Jean-Christophe Rolland, a partner at European IP law firm Gevers & Ores; and Vincent Brault, Senior Vice President of Product, Innovation and Marketing at Anaqua, a major IP service provider and software company.
Several key topics were on the agenda, followed by a Q&A session where questions from attendees were fielded. For those who would like to view the webinar in full, you can do so here, but below is a topic-by-topic rundown of what was covered.
How do you ensure that IP is aligned with the business?
It was clear that for all our practitioners, the availability of the in-house IP team is key. For IP teams to connect with design and innovation teams at as early a stage as possible is crucial in keying the IP to the business drivers. Building an IP strategy makes no sense if it’s not following the business purpose.
Mr. Brault observed that this takes place at the macro level (sitting down with the business to define the strategy for each IP portfolio; setting measurable goals and objectives) and at the micro level (aligning IP assets with the corresponding product, with its specific market, sales and revenue; seeking input from the business units for all decisions).
Mr. Gourcy pointed out that IP teams must also be flexible and open with the services and information they provide, in order to be seen as a business partner – for assessing the technology landscape, for branding guidance, for determining key performance indicators (KPIs) – rather than as a cost centre. Practitioners must provide their guidance as practical advice rather than simply spewing legal knowledge.
There should also be regular reviews, said Mr. Rolland, between IP teams and business units to ensure continued harmonisation of goals.
All panellists went on to give specific examples of IP portfolio strategies being actively aligned with business goals; given her senior role at Novo Nordisk, Ms. Fabritius de Tengnagel had especially interesting insights, using the company’s approach to device selection as an example.
Have you observed an evolution of the expectations and demands that the business functions place on IP counsel, both internal and external?
Mr. Gourcy noted that organisations are evolving away from viewing IP counsel as a cost centre and towards viewing it as crucial to the business’s understanding of its technological and competitive environment. Nonetheless, IP teams are expected be able to adapt filing strategies to the business environment.
Generally, IP teams are expected to keep their day-to-day tasks internal rather than outsourcing them to external advisers; this is part of a general trend of businesses wanting to retain control of their IP portfolio and strategy, which would otherwise run the risk of being directed by advisers outside of the business. Mr. Brault observed that nowadays, relationships with external IP counsel are characterised more by transparency, collaboration and focus on value-add.
Nonetheless, as Mr. Rolland pointed out, IP advice is not simply a question of cost: it is a question of aligning IP strategy with firm strategy. IP, including external counsel, is invested in accordingly.
Seeing IP as an investment naturally raises the question of return on investment (RoI), a useful concept when looking at the value-add of IP. Mr. Brault clearly believed that RoI should be shown to justify the budget: priorities and benchmarks should be set, KPIs managed and met, reports completed, and improvements made accordingly.
How do organisations of different sizes approach IP differently?
Having assisted companies of all sizes, Mr. Brault was well placed to answer this question. In smaller companies, there is a tendency to rely on outside counsel to educate the business and drive the IP strategy. Start-ups, small to medium-size enterprises (SMEs) and even some companies of intermediate size have to think carefully when there is no room for an internal IP team.
Many mid-size companies do have small IP teams, though these rely on individual talent and expertise. Larger companies tend to have a mature IP infrastructure, with the corresponding tools, processes and operations; there is more engagement with the business units, as well as careful management of outside counsel.
Mr. Gourcy concluded by saying that ultimately, no matter how large the business is, the IP team should pursue its innovation efforts to deliver what the business really needs.
Can IP actually lead the business? Outside of acquiring key drug developers in the pharma sector, is major M&A being driven or guided by IP?
Ultimately IP follows the business purpose. There is no IP strategy without a business strategy. IP’s main priority is to support and enable, not to lead. At Novo Nordisk for example, all innovation is driven by patients’ needs: the role of the IP team is to maximise the value of the company’s innovation, ensuring that the company can continue to innovate to benefit patients.
However, there are some exceptions to IP being a mere supporting player: IP can steer innovation. As a result, IP has become a key aspect of organisations around the world; even some smaller organisations have in-house IP teams. Major companies such as Apple, Samsung and Disney have moved to business models that themselves are heavily focused on IP, which has drawn attention to the value of intellectual capital. Not for nothing is Mr. Gourcy DS Smith’s manager of intellectual capital, rather than intellectual property.
Opinions differed on the role of IP in M&A; some panellists maintained that it plays a larger role than before, and is now almost always looked at to some degree when considering corporate transactions. Mr. Brault’s experience led him to suggest that in many cases, IP is often an afterthought for not only corporate buyers and private equity firms but even venture capital firms. Nonetheless, everyone agreed that IP is increasingly seen as a key part of a company’s long-term vision.
As for where IP is leading M&A besides the life sciences sphere, telecoms and semiconductors are key sectors of note. Ms. Fabritius de Tengnagel pointed out that Novo Nordisk had recently acquired Emisphere for $1.8 billion, as evidence that acquisitions are often based on attractive technology and how it is protected, though of course, even here, product viability and revenue are more immediate considerations than IP when it comes to acquisition strategy.
Has technological evolution helped IP impact the business, such as by facilitating collaboration or breaking down silos?
There was broad agreement that companies are more responsive and accurate thanks to technological tools. Messrs Gourcy and Rolland pointed out that access to new platforms that enable easy searches, FTO (freedom to operate) analysis and patentability assessments have been very helpful, as has access to new tools that optimise IP management and enable IP departments to finally measure and deliver on KPIs other than cost reduction.
Mr. Brault pointed out that there has been major progress in three areas: IP analytics and business intelligence, which allow the gathering and processing of big data; business-friendly portals that allow a blend of innovation, branding and marketing; and collaborative platforms, such as for brand management, that allow the alignment of offence and defence.
Ms. Fabritius de Tengnagel highlighted the increasingly unified processes and use of IT irrespective of location, and the local expertise that can therefore be seamlessly brought into play. Digital tools are business enablers – though they do require a focus on change management to ensure business success.
As the agenda wound to a close, certain conclusions became clear. IP supports the business and helps it achieve its goals, rather than leading the business; nonetheless, IP has undergone a shift in perception, increasingly seen as an important investment – though this conceptualisation has also raised the question of IP’s RoI, something that businesses of all sizes must consider.
What followed was a Q&A session, where the panellists fielded questions from the audience.
What kind of tools are being used for IP strategies? Do you use DIN or ISO standards?
Mr. Gourcy said he uses a variety of tools, including online and collaborative platforms. IP teams ask a lot of IT teams here. One example of a free tool provided online by the European Patent Office (EPO) is IP Score, software that helps come up with valuations of technology and patents. In any case, data security is always key when considering IP tools.
Mr. Rolland said that he wasn’t familiar with particular standards except when it comes to monetising IP or protecting data; he pointed out that such standards would be useful for certain functions such as IP valuations.
Mr. Brault said that Anaqua has been working with a German organisation on DIN, applying a norm to IP practice – in other words, turning innovation into an IP asset.
Ms. Fabritius de Tengnagel suggested that artificial intelligence could be a gamechanger for IP strategies.
What asset management tools can be used for intangible assets?
Mr. Brault said that blockchain and time-stamping are and will be very useful. Anaqua customers often want to protect knowledge, such as trade secrets; such tools could be crucial in protecting these.
Mr. Gourcy echoed Mr. Brault, stating that his team is currently working with DS Smith’s IT team to implement a blockchain-based system. His team is always looking for new tools to ensure that the IP teams are involved at the earliest stage, to implement the right processes for every portfolio.
How has COVID-19 changed IP strategies?
Ms. Fabritius de Tengnagel and Mr. Gourcy said that it hadn’t changed a thing, as their respective businesses hadn’t been badly impacted. Both companies have a consistent IP strategy and culture, and would adapt their IP strategy if necessary to react to exogenous shocks.
Mr. Brault said that some sectors are paying more attention to cost-effective ways to manage specific IP activities, though this is industry-specific, particularly in travel and leisure. Law firm clients are much more fiscally conservative.
Mr. Rolland said that IP activity in transport and energy have been rising again.
Question for Mr. Gourcy: Given that patents take time to be granted, what are some good KPIs in the interim?
Mr. Gourcy replied that one should look at the transformation rate between invention and patent filing (as opposed to patent grants). The IP team has to submit filings at the earliest possible stage. The number of FTO searches is also a good KPI, as is RoI.
Ultimately, the IP team’s key aim is to enable the company to do business in a safe environment, without infringing. A price-fixated KPI – reducing costs for the sake of it – should be avoided.
Report by Arjun Sajip