IP strategist: Using intellectual property to help large multinationals harness their innovative edge

Recently, I attended a technology conference in Berlin focused on start-ups and innovative thinkers. While there was great energy and some interesting talks from big names – including Tom Hulme, general partner at Google Ventures, Brandon Spikes, former chief executive officer at SpaceX, and former German Vice Chancellor Philipp Rosler – to be honest, some of the content lacked substance. One attendee who was there to scout technologies for a large corporation put it well when she said: “there isn’t much meat on this bone, is there?”

Her comment led to a genuine and pointed conversation about the intersection of intellectual property and strategic innovation. She shared her frustration with being tasked to find the next ‘thing’ or ways to incorporate ‘X’ technology concept (replace ‘X’ with artificial intelligence, Internet of Things, blockchain or some form of big data in the Cloud) with existing products. My fellow attendee was frustrated with the lack of access to resources that would help her succeed. Her commentary was a perfect example of how innovation goals are too often poorly defined and communicated within an organisation and then distributed to employees, who lack the experience and resources needed to make these goals achievable.

While this is not a new problem, it is becoming more acute as the pace of innovation increases. Global multinational enterprises (MNEs) and start-ups speak different languages and have different ways of viewing and promoting innovation. They often fail to understand each other’s needs even when they meet – and forums or opportunities to do so are rare.

Below are a few observations based on our recent experience assisting both start-ups and major corporations with their digital transformation agendas.

Set an innovation agenda

This should come from the top of the organisation – with a narrative defining what ‘innovation’ means for the company – and include qualitative or quantitative targets. For example, a business might want to improve the return on investment from R&D, get more new products to market for the same investment or add entirely new product lines through collaboration or M&A activity. Alternatively, it may want to be seen as innovative or disruptive. It might also have a view of other emerging technologies that complement their existing business activities. Having a well-defined and communicated innovation agenda helps to keep employees on track and focused.

Use intellectual property to create a realistic picture

One of the barriers to maximising innovation for an MNE is a lack of visibility regarding the current state of play. Running an audit to capture the IP activities of a company’s various corporate business units and visualise the rate and engagement in innovation that they demonstrate can be eye opening in revealing disparities between investment and the intellectual property generated. This improved visibility usually stimulates engagement from business leaders to catch up with their peers and request support to accelerate their progress.

A second lever that drives action is to improve the visibility of competitor innovation and use this to highlight corporate innovation performance. IP filing trajectories, portfolio sizes and metrics like patents per R&D dollar invested in competitive benchmarks can be used to help executives see their peer ranking. Experience shows that perceptions are often exaggerated.

Harness start-up crowds with strategic planning

MNEs are trying to reach out to the start-up community in various ways in order to source innovation. In Berlin and London, there are countless start-up accelerators, significant levels of seed funding (eg, High-Tech Gründerfonds) and MNEs creating their own incubators (eg, AXEL Springer and Volkswagen). Their aim is to connect with start-ups and provide a welcoming environment in which they can develop and grow closer to the MNE. Unfortunately, there are only a few success stories (one or two early exits, no unicorns and inadequate quality or quantity of start-ups) to meet the demands of all of the MNEs active in the space. And all of this is before we consider whether the right start-ups have contact with a well-matched MNE.

However, some companies are using the power of intellectual property and in-depth market research to find specific partners which are already developing relevant technology that meets their technology roadmap and then engaging meaningfully and directly with them. Matching and counselling requires an understanding of the technology, culture and the possible deal structure that meets the needs of both parties. An innovation framework can often prove essential, along with deals to ensure that combining two cultures does not diminish or extinguish innovation.

Going forward

These observations point us back to the importance of IP departments in advancing a company’s innovative edge. There are many opportunities for heads of intellectual property and IP managers to use IP data to better define and support their company’s innovation agenda. This raises the profile of those tasked with IP management and highlights the important role that they can play in supporting their organisation’s innovation agenda.