Edison in the Boardroom : How Leading Companies Realize Value From Their Intellectual Assets

Annotation Julie L. Davis and Suzanne Harrison Today's corporations are always on the lookout for exciting new and innovative ideas that can be used to generate revenue. Up until recently, this meant taking these ideas and turning them into products or services, which could then be sold for profit. But today, a unique new concept is revolutionizing the way companies are getting value from ideas. Instead of incorporating them into products or services, today's innovations may be bartered, licensed or sold in the "idea" stage for tremendous amounts of money. For example, IBM currently receives well over $1 billion in revenue every year from licensing its intellectual property, unrelated to the manufacture of a single product. Today more and more companies are adopting this idea of turning their legal departments, where intellectual property is housed, from cost centers into profit centers. Edison in the Boardroom: How Leading Companies Realize Value from Their Intellectual Assets takes an in-depth look at the revolutionary concept of Intellectual asset management (IAM). IAM is changing the way companies all over the world are doing business. In their careers as business consultants, the authors have been privileged to meet individuals who were clearly ahead of their time when it came to realizing value from their companies' innovations. Based on their interactions with the ICM Gathering--an international group of companies who meet several times a year to create, define and benchmark best practices in the area of IAM--the authors have compiled a wealth of knowledge and successful stories that illustrate how far businesses have come in their ability to leverage and monetize their intellectual assets. Incorporating stories and teachings from some of the most successful companies in the worlds -- such as Hewlett-Packard, IBM, Procter & Gamble, Rockwell, Dow, Ford and many others -- the authors have made an exhaustive study of IAM and its implications for today's businesses. They have culled a hierarchy of best practices that today's companies can integrate into their own business philosophies to gain the best return from their intellectual assets "Edison in the Boardroom offers the reader something that is hard to find-a clear perspective and roadmap that shows how patent assets fit on the corporate landscape. The authors develop a unique five-level hierarchy of asset management and take us on a seamless trip from start to finish. Along the way, there are candid revelations of viewpoints and techniques, punctuated by anecdotes, practical examples and testimonials gathered from knowledgeable professionals in industry. Here is a resource that business executives can consult time and again to navigate in the world of patents."--Stephen P. Fox, Associate General Counsel and Director, Intellectual Property, Hewlett-Packard Company

"Davis and Harrison masterfully synthesize first-hand accounts into practical advice for the intellectual asset manager. In an informative and easy style, they bridge the gap between best practices in an emerging field and the needs of managers for real-world solutions. Their solid advice has the capacity to change profoundly the way companies manage their intangibles for increased shareholder value. It's a must-read for everyone interested in increasing returns from intellectual assets." --Jim O'Shaughnessy, VP & Chief Intellectual Property Counsel, Rockwell

"Edison in the Boardroom reveals the winning strategies employed by some of today's biggest companies in maximizing the value of their intellectual property. Well written and extremely readable." --Jerry Rosenthal, Vice President, Intellectual Property & Licensing, IBM

"Edison in the Boardroom is an excellent source book for the beginner in extracting value from intellectual property. Additionally, it is a valuable resource for those who consider themselves as experienced in the field. I know that I learned several new best practices that I plan to apply to my business." --Henry Fradkin, Director, Technology Commercialization, Ford Global Technologies, Inc.

"The Value Hierarchy is clearly articulated in Edison and this provides a relevant guide for corporations to create value from their unique intangibles." --Sharon Oriel, Director, Global Intellectual Asset & Capital Tech Center, The Dow Chemical Company

"Lots of books spout theory and the philosophy of Intellectual Asset Management. What Davis and Harrison provide in Edison in the Boardroom is frankly much more valuable--a practical and 'real world vetted' guide to getting started and building a viable value extraction business!"--Jeff Weedman, Vice President of External Business Development and Corporate Licensing, Procter & Gamble

EDISON IN THE BOARDROOM......Page 1 CONTENTS......Page 14 INTRODUCTION THE EDISON PROPHECY......Page 16 A Brief History......Page 17 Why Intellectual Property Is Important......Page 18 The Edison Mindset......Page 22 The Value Hierarchy......Page 27 The Intellectual Property Management System......Page 30 Conclusion......Page 32 1 LEVEL ONE—DEFENSIVE......Page 34 What Level One Companies Are Trying to Accomplish......Page 35 Best Practices for the Defensive Level......Page 38 Conclusion......Page 56 2 LEVEL TWO—COST CONTROL......Page 58 What Level Two Companies Are Trying to Accomplish......Page 59 Best Practices for the Cost Control Level......Page 61 What Level Three Companies Are Trying to Accomplish......Page 82 Best Practices for the IP Profit Center Level......Page 84 Conclusion......Page 109 4 LEVEL FOUR—INTEGRATED......Page 110 Best Practices for the Integrated Level......Page 111 Conclusion......Page 137 What Level Five Companies Are Trying to Accomplish......Page 138 Best Practices for the Visionary Level......Page 140 Conclusion......Page 155 The Dow Chemical Company: Built on Inventions......Page 158 The Journey from Patents to Intellectual Assets......Page 159 The Journey Continues: Intellectual Capital Management for the 21st Century......Page 166 The ICM Pilot Program......Page 168 Key Learnings from the Dow ICM Pilot in Polyurethanes......Page 171 The Future at Dow Is Intellectual Capital Management......Page 172 APPENDIX A MINING A PORTFOLIO FOR VALUE......Page 174 Understanding Your Claim......Page 176 What to Look For......Page 177 Value Extraction Objectives......Page 178 How to Mine......Page 180 The Portfolio Mining Process......Page 182 Introduction......Page 184 Why Perform a Competitive Assessment......Page 186 Company Position......Page 188 Key Indicators of Need......Page 190 General Approach......Page 192 Conclusion......Page 195 APPENDIX C INTEGRATED PERFORMANCE REPORTING......Page 196 Background and Overview......Page 197 A Framework for Evaluating Integrated Performance Reporting Practice and Capabilities......Page 200 Financial Performance Reporting......Page 201 Operational Performance Reporting......Page 202 Integrated Indicators Reporting......Page 203 Comparative Performance Reporting......Page 206 Value Creation Reporting......Page 207 Integrated Performance Reporting Evaluation Matrix......Page 210 NOTES......Page 214 INDEX......Page 218 "Edison in the Boardroom: How Leading Companies Realize Value from Their Intellectual Assets takes an in-depth look at the revolutionary concept of intellectual asset management (IAM). IAM is changing the way companies all over the world are doing business. In their careers as business consultants, the authors have been privileged to meet individuals who were clearly ahead of their time when it came to realizing value from their companies' innovations. Based on their interactions with the ICM Gathering - an international group of companies who meet several times a year to create, define, and benchmark best practices in the area of IAM - the authors have compiled a wealth of knowledge and success stories that illustrate how far businesses have come in their ability to leverage and monetize their intellectual assets.". "Incorporating stories and teachings from some of the most successful companies in the world - such as Hewlett-Packard, IBM, Procter & Gamble, Rockwell, Dow, Ford, and many others - the authors have made an exhaustive study of IAM and its implications for today's businesses. They have culled a hierarchy of best practices that today's companies can integrate into their own business philosophies to gain the best return from their intellectual assets."--BOOK JACKET.