Transfer Pricing Associates

Develop Intellectual Property Strategy

post Wednesday December 7, 2011

Tags: intellectual property strategy

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Intellectual property is playing a more and more important role in today’s business world. Today, intellectual property attributes about 50-80% to the business revenue and a properly designed IP strategy will better help companies to protect and explore the value of their IP.

Intellectual property is the result of innovation; however, not all the results of innovation create value. Companies need to first identify what they have and the value of them. After identifying the values of the IP, companies should set up policies to properly protect their IP and then, figuring out approaches to explore the economic benefits of them.

Different from tangible assets, intangibles assets are hard to identify sometimes. More than often, intangible assets are directly linked to patents, trademarks and copyrights. But, intangible assets are more than that. It can be the embedded workforce, know-how and trade secrets that can be hard to protect by law. In order to properly identify your intellectual property, it is recommended to do a thorough audit of all the intangible assets in the company. The audit can be performed internally or by an outside specialist. The specialist usually will perform a audit of the company and identify valuable intangible assets of the company, moreover, it can help the company to identify possible future opportunities for exploiting any IP further. After the assessment, the company will be able to value their intangible assets.

Identify is the first step of developing a sound IP strategy. After understanding the intangible assets that the company owns, companies should develop policies and procedures to protect their valuable assets. IP protection not only protects your property from infringement but also help to secure the value of your assets. There are various issues in this area. If you are Start-up Company, how can you protect your ideas not being registered as patents by other big companies or prevent your employees to bring ideas to competitors? If you are a multinational company, how can you protect your trademark or products from infringement in other countries? These are just two pretty straight forward questions. Considering the natural of protection, many companies will ask the legal department to manage their IP. It is effective to use legal department to protect intangible assets; however, at the same time, the company should also keep in mind that intangible assets will generate more value if it is treated as business. An estimation of the legal protection cost will better help the company to plan its business.

After answering the questions of IP protection, companies should seek ways to commercialize their intangible assets. There are a few things companies should evaluate to plan the commercialization.

   Risk-- is an inherent component of any business. IP managers should be able to asses and quantity the risk of different IP.

   Budget – a detail planned budget will help companies to better explore and utilize the benefits of intellectual property.

   Investment—is closely tied to budget. It sets the limits for IP management and development. Companies need to decide the desire level of investment and development they are looking for the budget period.


An effective IP strategy needs to be fully integrated with a company’s business plan. It should be based on the current and future needs of the company, fit the goals and vision of the company and helped the company to develop to the next level. Moreover, during the life of a company, the plan will change. The IP needs to be reviewed on a regular basis to ensure it is constantly aligned to the business plan. 

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