Why the C-suite and IP team should talk

5 minute read
02 July 2019

In markets being changed by disruptive technology, intellectual property can be a CEO's best friend. But seeing IP as 'legal' not commercial misses the bigger picture.

What you believe is important, expensive or risky from an IP perspective depends on where you sit.

It is natural for people focused on different roles within a company to see the market they share differently.

But from an operational perspective, gaps in world-view between departments can lead to blind spots from which risks, and in some cases opportunities, can surprise the business.

In the context of world-changing innovations like artificial intelligence, diverging outlooks between the C-suite and, for instance, heads of intellectual property (IP), can be damaging.

By definition, disruptive technology upends the old way of doing things. Start-ups working out of the cloud with a bet-the-company patent can be surprisingly competitive, circumnavigating traditional barriers to entry and chipping away at the established order.

In this scenario, intangible assets like patents, trademarks and designs play a greater role in deciding who pivots and who panics.

Yet while IP increases in value and importance, the C-suite often considers it to be a legal concern. A necessary evil. An inconvenient cost-base that slows competitiveness.

Difference in opinion

Our survey and report Multiplicity: Smart choices in disruptive times revealed other differences between the C-suite and legal that could prove significant in markets affected by new tech. The report explores the impact of disruptive technology on IP, download a copy of the report to find out more.

The C-suite thought start-ups were a greater risk than their IP colleagues, revealing their market knowledge. They also put Internet of Things/connectivity above other disruptive technologies.

Meanwhile, IP heads placed greater importance on registering IP in China - a key IP market - than the C-suite.

Most interestingly, just 47% of the C-suite said IP was 'very important' to their companies, compared with 61% of IP heads.

"There is, especially in larger publicly-traded companies, enormous pressure on the C-suite level for a short-term return and being able to demonstrate ROI," says Bruce Sales, an experienced IP partner at US firm Lerner David.

"But the nature of IP asset acquisition rarely offers an immediate ROI return."

The importance of IP

Companies obtain IP rights for all kinds of reasons: to protect markets, protect technologies, to put impediments in front of competitors... and parts of the process can take years.

When an IP team is building a strategic patent or trademark portfolio, it does not matter that it complements a business plan. If C-suite do not see the benefit from their perspective, that can be a problem.

Which might explain why our survey showed the C-suite is more likely than legal to think there is a 1-2-year IP plan at their business.

"You end up with executives who are more inclined to forego IP protection than they were in previous times," Sales adds.

But a failure to recognise the importance IP will play in future means missing the huge opportunities offered by new innovations through IP creation, protection or licensing.

Plus, there is a danger of exposure to IP risks that could mean taking a significant hit through litigation, infringement or unforeseen licensing costs.

And that hurts everyone, from the top down.

Download a copy of Multiplicity: Smart choices in disruptive times to explore this topic in further detail.

NOT LEGAL ADVICE. Information made available on this website in any form is for information purposes only. It is not, and should not be taken as, legal advice. You should not rely on, or take or fail to take any action based upon this information. Never disregard professional legal advice or delay in seeking legal advice because of something you have read on this website. Gowling WLG professionals will be pleased to discuss resolutions to specific legal concerns you may have.
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Multiplicity: Smart choices in disruptive times

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