Intellectual property (IP) is commonly mistaken for something only big businesses need to worry about - but businesses of all shapes and sizes should invest in IP.
From branding and reputation to patents, software, critical databases and trade secrets, there are many ways you could already have developed IP without even realising it.
IP can be:
Capitalised – IP is an asset, and so it’s financial value should be considered as part of the value of your business. It can sometimes even be possible to secure finance against IP.
Here’s a guide to the different forms of intellectual property in your business.
Branding and reputation
There's no doubt that brands are important; we’re surrounded by them. According to advertisers, we define ourselves by the brands we choose. But a ’brand‘ is more than just an image created by clever marketing.
’Brand‘ has come to mean everything that comes to mind in relation to a company, a product or service, including product quality, delivery, customer service, price, and image. Taking all of this into account, the brand you’ve worked extremely hard to build could well be your intellectual property, which has a real monetary value to your business.
All businesses and inventions start with an idea. Intellectual property rights like patents are the expression of that idea. If you can prove that your idea is novel, meaning it has never been made public in any way, anywhere in the world, you could well be able to file a patent and protect your intellectual property.
Equally importantly, you can’t patent certain types of invention:
- Literary, dramatic, musical or artistic works
- A way of doing business, playing a game or thinking
- A method of medical treatment or diagnosis
- A discovery, scientific theory or mathematical method
- The way information is presented
- Some computer programs or mobile apps
- ‘Essentially biological’ processes like crossing-breeding plants, and plant or animal varieties
The first step to patenting is to search for similar patents, to see if yours is available to license. If you decide to go ahead, it becomes a legal process to follow and specialist patent attorneys can guide you through the process.
A software licensing agreement protects the author's copyright and IP by placing restrictions on the end user in relation to the usage of the application. The software licence sells the use of the software, not the software itself. Most software is covered by copyright.
If you are considering becoming a software publisher, it is critical that you licence your software very carefully to retain your IP rights and to ensure you can generate revenue from your work.
And if you commission someone else to design software for your business, make sure the IP terms are explicit in your contract, and that the price you pay is appropriate depending upon whether you are buying the IP, or licensing it.
Databases are an integral part of digital curation – that is, the management of digital data and assets. Ownership of the intellectual property in a database and the associated rights this provides will have a significant effect on what you’re able to do with a database.
The most obvious examples are customer contact data, but equally any forms of organised information could be considered intellectual property.
A trade secret is any formula, pattern, compound, device, process, tool, or mechanism that is not generally known or discoverable by others. It’s usually maintained in secrecy by its owner, and gives a competitive advantage because it is kept secret. The classic example of a trade secret is the formula to Coca-Cola.
A trade secret can theoretically last forever — for as long as its owner uses reasonable efforts to keep it secret and someone else doesn’t independently create or ’discover‘ it. This is a prime example of how intellectual property can help add value to your business.
Know-how is similar to trade secrets, but far more difficult to quantify as a discrete IP asset. It is an accumulation of information, knowledge, and experience (some of which may qualify as trade secrets, some not) that enables its possessor to achieve practical results which cannot be obtained without it.
Know-how is the essence of what makes a company's most valuable employees valuable. Trade secrets and know-how, unlike patents, may be licensed in perpetuity.
Research and development
Research and development (R&D), and innovation, is the process of developing and commercialising new ideas, implementing new processes or changing the way the business makes money. It’s the activities required in order to keep the business competitive and sustainable in the long term.
This includes research, new product/service development, new process development, continuous improvement, and new business models.
Strategy and marketing intelligence
Market intelligence is analysis focusing on the total environment in which a business operates, including information on its competitors and possible new entrants to the market. This can be particularly valuable in the context of a company’s patenting strategy, as it would need to know competitor’s patenting activities, which may affect future/planned patents.
Want to start examining this in your business? The Business & IP Centre in Newcastle hold regular surgeries where you can go along for advice and support.