Module 7: Innovation Finance & Metrics
Why should you use this method?
- Decide on the right strategy to protect the intellectual property created in an innovation project.
- Align the innovation project and its goals with the company strategy early on.
What is intellectual property?
Intellectual property (IP) refers to the ownership of an idea or design, such as copyright, trademark, or patents. The challenge is to keep the IP up to date and defend it from hostile competitors, and hence it is crucial to protect the IP as it is an intangible asset.
Within an innovation project, it is helpful to think about your IP strategy early on. This can help set better goals, define potential business models, and align the project with your company’s strategy.
There are three different core strategies to exploit intellectual property in your company:
- Exploitation in-house: A cash-rich company having control over all aspects of the business model, from patent strategy to marketing to brand development.
- Licensing strategy: A partnership between the owner (typically smaller company) of the intellectual property and another party who wants to use the intellectual property for different applications, e.g., manufacturing processes.
- Divestment: Selling the IP ultimately when the owner does not see any value in the future or needs cash upfront.
How can you apply this method?
0. Open up the flowchart
Have the flowchart printed or open in front of you
1. Cash-rich company
Decide if your company has a lot of money in hand and follow the arrow
2. Requirement of funding or money
Decide if your company needs money to sustain and follow the arrow
3. Product/ Innovation future
Decide if you see a future with the product or the innovation challenge designed by the company, and then follow the arrow
4. Define IP Strategy
Based on the decisions made in the above three questions, the flowchart will lead you to the appropriate strategy to be followed to protect your IP.
5. Align the project goals
Look at your project goals. Do your KPIs contribute to the IP strategy you defined? (Re)formulate your KPIs with your ultimate goal of how to monetize the IP in mind.