Transcript Managing Intellectual Property Assets for Enhancing the Competitiveness of SMEs Guriqbal Singh Jaiya Director, SMEs Division The Small and Medium-Sized Enterprises (SMEs) Division of WIPO.

Managing Intellectual Property Assets
for Enhancing the Competitiveness of
SMEs
Guriqbal Singh Jaiya
Director, SMEs Division
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
From Invention to Innovation
While invention depends upon
creativity,
successful technological innovation
requires integrating new knowledge
with multiple business functions.
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Innovation – What is it?
The creation of new ideas/processes which
will lead to change in an enterprise’s
economic or social potential
[P. Drucker, ‘The Discipline of Innovation’,
Harvard Business Review, Nov-Dec, 1998, 149]
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
What is Innovative Thinking?
– A means of generating innovation to achieve two objectives that are
implicit in any good business strategy:
• make best use of and/or improve what we have today
• determine what we will need tomorrow and how we can best achieve
it, to avoid the "Dinasaur syndrome«
– Innovative thinking has, as a prime goal, the object of improving
competitiveness through a perceived positive differentiation from
others in:
• Design/Performance
• Quality
• Price
• Uniqueness/Novelty
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Obstacles to Successful
Innovation
•
Competitive position
•
Market judgement
•
Technical performance
•
Manufacturing expertise
•
Financial resources
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Innovation
How to classify newness and degree of
innovation and what to focus on:
• New to the firm?
• First in the market?
• First in the world?
• Incremental or radical innovation?
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
There are several types of new products. Some are new to the
market, some are new to the firm, and some are new to both. Some
are minor modifications of existing products while some are
completely innovative
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Product Development Strategies
Old Product New Product
Old
Market
Market
Penetration
Product
Development
New
Market
Market
Development
Product
Diversification
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Marketing principles…….
•
Identify opportunities and threats
•
Identify customer needs
•
React to a competitive environment
•
Careful planning to make a New or improved product
•
Use the 4 P’s….
•

Product service

Price

Promotion

Place (distribution)
Retain flexibility to react to changes
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
The Development of Technology: From
Knowledge Generation to Diffusion
IM ITATION
Supply side
Basic
Knowledge
Invention
Innovation
Diffusion
Demand side
ADOPTION
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Innovation Process
Invention
Innovation
Imitation
• The adoption of an
innovation by similar firms
• Usually leads to product or
process standardization
• Products based on imitation
often are offered at lower
prices but with fewer
features
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
The Innovation Process
• An innovation starts as an idea/concept that is refined and
developed before application.
• Innovations may be inspired by reality (known problem).
The innovation (new product development) process, which
leads to useful technology, requires:
– Research
– Development (up-scaling, testing)
– Production
– Marketing
– Use
• Experience with a product results in feedback and leads to
incrementally or radically improved innovations.
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
The Innovation Process
Translation of a Creative Idea into Useful
Application
Analytical
Planning
Organizing
Resources
Implementation
Commercial
Application
To
To Provide:
To Obtain:
Accomplish: Value to Customers
Materials
Organization Rewards to Employee
Technology
Product Design Revenue to Investors
Human Resources
Manufacturing Satisfaction of
Capital
Services
Founders
To Identify:
Product
Design
Market
Strategy
Financial
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Need
The Profitability of Innovation
Profits
from
Innovation
Value of an
innovation
• Legal protection
Innovator’s
ability to
appropriate
value from an
innovation
• Ease of imitation
of technology
• Complementary
resources
• Lead time
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Appropriating Value from
Innovation
Barriers to Integration
Different Time
Orientation
Interpersonal
Orientation
Different Goal
Orientation
Formality of
Structure
Facilitators of
Integration
Shared Values
Leaders’ Vision
Time to
Market
CrossFunctional
Integration/
Design Teams
Product
Quality
Value
Appropriation
from
Innovation
Creation of
Customer
Value
Budget Allocation
Effective The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Communication
Product Life Cycle
Maturity
Decline
Sales
Growth
Introduction
Time
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
New Product Development
Stages in a New Product Development process:
• Idea Generation
• Idea Screening
• Concept Development and Testing
• Business Analysis
• Beta Testing and Market Testing
• Technical Implementation
• Commercialization
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Technology Adoption – Diffusion of Innovation
Time
Take up Rate
Early
Adopters
Innovators
Innovators:
Early adopters:
Early majority:
Late majority:
Laggards:
Early
Majority
Late
Majority
Laggards
venturesome; greatest need
opinion leaders; needs driven
deliberate
skeptics
traditionalists; suspicious
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
New Business Models Emerge
Then…
Now…
CRO’s
CRM’s
Product
Development
Product
Development
Cycle
Tool
Companies
One Integrated
Company
Testing
Services
Many Distributed
Companies
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
New Regional Model Emerge
Then…
Now…
Region D
Region A
Region B
Manufacturing
Region C
Research
Trials/Testing
Services
Development
Self-contained
regional clusters
Region G
Region E
Region F
Specialized,
networked regions
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Commercialization Model
• Strategic Investment is the Foundation of a
Successful Commercialization Model
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
What Investors Look for?

Novelty; world-class; evidence of commercial
interest; clear path to market

Unencumbered, or encumbered by reasonable
conditions (Equity, royalties)

Protection (Non-disclosure agreements,
Patents, Designs, Brands, Copyright)

IP protected by one or more Patents is the IP
required to implement the business plan

“Freedom to Operate”
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Innovation, Intellectual Property
and Poverty Reduction
Critical Ingredients for Innovation:
• Intellectual Capital
• Human Capital
• Financial Capital
• Proximity
• Social Network Capital
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Complementary Resources
Manufacturing Distribution
Finance
Core
technological
know-how
Service
Complementary
technologies
Marketing
Other
Other
Bargaining power of owners of complementary
resources depends upon whether complementary
resources are generic or specialized.
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Alternative Strategies for Exploiting Innovation
Licensing
Risk &
Return
Strategic
Alliance
Joint
Venture
Shares
investment &
risk. Risk of
partner
conflict &
culture clash
Small risk, but
limited returns
also (unless
patent position
very strong
Limits
investment, but
dependence on
suppliers &
partners
Benefits of
flexibility;
risks of
informal
structure
Few
Allows outside
resources &
capabilities
To be accessed
Permits pooling of the
resources/capabilities of
more than one firm
Konica
licensing its
digital
camera to
HP
Pixar’s movies (e.g.
“Toy Story”)
marketed &
distributed by
Disney.
Competing
Resources
Examples
Outsourcing
certain
functions
Apple and
Sharp build
the
“Newton”
PDA
Microsoft
and NBC
formed
MSNBC
Internal
Commercialization
Biggest risks &
benefits.
Allows complete
control
Substantial
resource
requirements
TI’s
development of
Digital Signal
Processing
Chips
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Uncertainty & Risk Management in Tech-based Industries
Technological
uncertainty
Sources of
uncertainty
Market
uncertainty
Selection process for standards and
dominant designs emerge is complex
and difficult to predict, e.g. future of 3G
Customer acceptance and adoption rates
of innovations notoriously difficult to
predict, e.g. PC, Xerox copier, Walkman
Cooperating with lead users
early identification of customer requirements
–assistance in new product development
Strategies for
managing risk
Flexibilility
Limiting risk exposure
—avoid major capital commitments
(e.g. lease don’t buy)
—outsource
—alliances to access other firms’
resources & capabilities
—keep debt low
—keep options open
—use speed of response to adapt
quickly to new information
The Small
and Medium-Sized Enterprises (SMEs) Division of WIPO
—learn
from mistakes
Innovation risk
RISKS
RESEARCH
COSTS
DEVELOPMENT
COMMERCIALISATION
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Mortality of New Product Ideas
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
The “ Right” Innovative Product?
 The right product is one that becomes available at
the right time (i.e., when the market needs it), and is
better and/or less expensive that its competition.
 To have the right product, therefore, one must:
 Predict a market need
 Envisage a product whose performance and
capability will meet that need
 Develop the product to the appropriate time
scale and produce it.
 Sell the product at the right price
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Innovation and Competitive
Advantage
Difficult for
competitors to imitate
Commercially exploitable
with present capabilities
Provides significant
value to customers
Competitive
Advantage
Timely
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Strategic Entrepreneurship and
Innovation
• Entrepreneurship is concerned with:
– The discovery of profitable opportunities
– The exploitation of profitable opportunities
• Firms that encourage entrepreneurship are:
– Risk takers
– Committed to innovation
– Proactive in creating opportunities rather than
waiting to respond to opportunities created by others
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Entrepreneurship
Creativity is at the heart of entrepreneurship, enabling entirely new ways
of thinking and working.
Entrepreneurs identify opportunities, large or small, that no one else has
noticed.
Good entrepreneurs also have the ability to apply that creativity—they
can effectively marshal resources to a single end.
They have drive—a fervent belief in their ability to change the way things
are done, and the force of will and the passion to achieve success.
They have a focus on creating value—they want to do things better,
faster, cheaper.
And they take risks—breaking rules, cutting across accepted boundaries,
and going against the status quo.
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Entrepreneurship
Defining entrepreneurship is difficult because there is no
universal, clear-cut definition of the term. In its most basic
sense, entrepreneurship is manifest in a business venture when
an individual is able to turn a novel idea into a profitable reality.
In practice, however, entrepreneurship is more multifaceted,
ranging from operating a small business in one’s own home, to
bringing a national franchise to a small town, to turning a new
and unique idea into a high-growth company. Entrepreneurship
can involve starting a business that brings a new store to main
street, offering a product or service previously unavailable to a
community, or acquiring an existing business that has had a
long-standing presence in a community and helping it evolve to
reflect one’s own vision and personality.
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Entrepreneurship
The word entrepreneurship literally means, "to take or carry
between" in the sense of an economic transaction; to be a
market-maker. It does not literally convey the notion of
innovation that we commonly associate with the term.
Joseph Schumpeter (1883-1950), one of the more well
known theorists on entrepreneurship, defined an
entrepreneur as one who reorganizes economic activity in an
innovative and valuable way. That is, an entrepreneur is one
who engages in a new economic activity that was previously
unknown. An entrepreneur is a risk taker because being
innovative means there are few rules or history for guidance.
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Entrepreneurship
Entrepreneurship is the process of
creating or seizing an opportunity, and
pursuing it regardless of the resources
currently controlled.
The Webster’s Third New International
Dictionary defines an entrepreneur to be
“one who organizes, owns, manages, and
assumes the risks of a business”
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Entrepreneurship
The entrepreneur shifts resources out of an area of lower and
into an area of higher productivity and greater yield.
[J. B. Say, French economist, circa 1800]
Entrepreneurship is creative destruction. Dynamic
disequilibrium brought on by the innovating entrepreneur,
rather than equilibrium and optimization, is the norm of a
healthy economy and the central reality of economic theory
and practice. [Joseph Schumpeter, Austrian economist, 1911]
The entrepreneur searches for change, responds to it, and
exploits it as an opportunity. Innovation is the specific tool of
entrepreneurs, the means by which they exploit change as an
opportunity for a different business or a different service
[Peter
Drucker, 1985]
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Entrepreneurship
Entrepreneurship drives innovation,
competitiveness, job creation and economic
growth.
It allows new/innovative ideas to turn into
successful ventures in high-tech sectors
and/or can unlock the personal potential of
disadvantaged people to create jobs for
themselves and find a better place in society.
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Entrepreneurship
Entrepreneurship, in small business or
large, focuses on "what may be" or "what
can be".
One is practicing entrepreneurship by
looking for what is needed, what is
missing, what is changing, and what
consumers will buy during the coming
years.
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Entrepreneurship
Entrepreneurs have:
– A passion for what they do
– The creativity and ability to innovate
– A sense of independence and self- reliance
– (Usually) a high level of self confidence
– A willingness and capability (though not
necessarily capacity or preference) for taking
risks
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Entrepreneurship
Entrepreneurs do not (usually) have:
– A tolerance for organizational bureaucracies
– A penchant for following rules
– A structured approach to developing and
implementing ideas
– The foresight to plan a course of action once
the idea is implemented and established
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Entrepreneurial Success
1. People (Entrepreneur /Entrepreneurial
Team)
2. Opportunity (Marriage of Market and
Product/Service)
3. Access to Resources (Land. Labor,
Capital, Knowledge)
And the fit amongst these three elements
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Major factors determining success of a
new product in the market
• The product provides functional
advantages
• Lower price for comparable product
• More attractive design (look)
• Reputation of brand
• Easy access: Available in the main retail
shops
• Consistent product quality
• Excellent after-sales services
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Competitive Advantage
Criteria…
Low cost producer
Product differentiation
Niche market
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Need two
processes:
NPD and
NB(usiness)D
New Product
Development
Breakthrough
Innovation
An opportunity
driven path to
marketa different
business design
New Business
Development
Innovative
New Products
New
Businesses
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Protection of IP
Value adding
Ideas
Confidentiality or Nondisclosure
Agreements (Trade Secrets)
Research
Technologies
Products
Collaborative Research
Agreement
Utility models, Patents
Technology Licensing
Agreement, Branding
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Intellectual Property Questions
Intellectual Property (IP) Issues/questions during New Product
Development (NPD):
Can the innovation be legally protected? For how long?
How does one protect an innovation from imitators? How much will it
cost? When to protect? Do you need to rely on an IP expert?
The answers are complicated by the fact that one or more types of legal
frameworks may be used to protect a particular innovation, product,
process, or creative work. These include trade secrets, trademarks,
designs, patents, and copyright.
It is necessary to know which are applicable and when each is
appropriate. This varies somewhat from jurisdiction to jurisdiction.
The advice of a lawyer that specializes in these matters is essential
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Intellectual Property Questions
•It is necessary to know which types of
intellectual property rights (IPRs) are
applicable and when is each type of IPR
appropriate. This varies somewhat from
one country to another.
•The advice of an IP lawyer is desirable
if not essential.
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Background
• In September 2000, the WIPO Assemblies
approved the creation of “a substantial new
program of activities, focusing on the IPrelated needs of SMEs worldwide”
• SMEs Division established in October 2000
• Nine professionals and three administrative
staff in the SMEs Division of WIPO
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Strategy
•
•
•
•
•
•
1.
2.
3.
4.
5.
6.
Demystification
New audience
New Areas
Proactive
E-Services
Partnership
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
(1) Demystification
•
•
•
•
•
•
Studies
Guides
Events and expert missions
Website and newsletter
CD-ROM
Magazine articles
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
(1) Demystification (Studies)
• National Studies (on IP and SMEs) completed or
under way in Argentina, Bhutan, Mongolia,
Nepal, Philippines, Sri Lanka, Tanzania, Sierra
Leone, Romania, Chile, Colombia, Costa Rica, El
Salvador, Honduras and Paraguay, Egypt,
Morocco, Lebanon
• WIPO Survey of IP Services to Tenants of
European Technology Incubators
• Norwegian SMEs and the IPR system
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
(1) Demystification (Guides)
• WIPO/ITC Guide on Marketing of Crafts and Visual
Arts; Role of Intellectual Property; A practical guide
• WIPO/ITC Guide on Secrets of Intellectual Property:
Guide for Small and Medium Sized Exporters
• WIPO/ITC Guide on Exchanging Value: Negotiating
Technology Licensing Agreements - A Training
Manual
• ITC Guide on Exporting Automotive Components
• ITC Guide on Pharmaceutical SMEs (Forthcoming)
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
(1) Demystification (Guides)
Published
• Making a Mark
(Trademarks)
• Looking Good
(Designs)
• Inventing the
Future (Patents)
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
(1) Demystification (Guides)
• Translation and/or customization: Under
way, with funding from several sources, in the
following countries: Algeria, Argentina,
Australia, Canada, Czech Republic, Egypt,
Estonia, Hungary, Italy, India, Israel,
Kenya, Lebanon, Malaysia, Malta,
Mongolia, Morocco, New Zealand,
Philippines, Poland, Slovakia, Spain,
Tanzania, Tunisia, Vietnam
• 16 Countries members of the OAPI
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
(1) Demystification (Events)
• Special programs, seminar and
workshops organized by the SMEs
Division in Geneva in partnership with
selected associations and organizations
(IASP, INSME, IPI, MOST, WASME)
• Annual WIPO Forum on IP and SMEs
for IP Offices of OECD Countries
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
(1) Demystification (Events)
• WIPO-Italy Forum on Textile
and Clothing Industries of the
Mediterranean Basin
Countries (Prato, Italy December 2003)
• Participants from Algeria,
Cyprus, Egypt, Jordan, Israel,
Lebanon, Malta, Morocco,
Palestine, Syria, Tunisia,
Turkey
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
(1) Demystification
(Website)
• The Website of the SMEs Division is in six UN
languages (English, French, Spanish, Arabic,
Russian and Chinese)
• More than 60,000 pages viewed every month in
2004
• Contents include sections such as IP for
Business, IP and E-Commerce, Activities, Best
Practices, Case Studies and Documents
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
(1) Demystification (Website)
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
(1) Demystification (Newsletter)
• Monthly e-newsletter in the 6 UN
languages (Free)
• Content includes articles, updates
with information, links and
documents
• Launched in August 2001
• Total number of subscribers: >19,000
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
(1) Demystification (CD-ROM)
• 50,000 copies of the SMEs Division CDROM distributed to SME support
institutions, IP Offices and others
worldwide
• Marketing and customization
• E-learning CD ROM (in partnership
with KIPO: “IP Panorama”)
• SAARC CD-ROM (in preparation)
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
(1) Demystification (Articles)
• Some articles recently published:
– What to do if you are accused of copyright
infringement
– Tapping into Patent Information: a buried treasure
– International trade in technology – licensing of
know-how and trade secrets
– Intellectual Property and E-commerce: how to take
care of your business’ website
– Offshore outsourcing and IP
– Savvy marketing: merchandising of IP rights
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
(2) New Audience
• Bringing IP issues to SME events
• Bringing new business perspective to IP
events
• New partnership: Open door policy
• IGOs, government focal points, SME support,
training and financial institutions, chambers
of commerce and industry, SME associations,
SME research institutions, private sector
institutions, universities, etc...
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
(3) New Areas
•
•
•
•
•
Creative Industries
IP for financing (venture capital, securitization)
Accounting and valuation of IP assets
IP Asset Management, IP Due Diligence and IP Audit
Fiscal policies and IP (tax incentives for R&D activities,
patenting, licensing etc.)
• IP services to SMEs by incubators, technology parks,
chambers of commerce and SME associations
• IP needs of SMEs in agriculture, biotechnology,
handicrafts, software, textiles, etc
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
(4) Being Proactive
• Original Content
• Links
• Best Practices
• Case Studies
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
(5) E-Services
•
•
•
•
•
Web site content
SME mail
E-mail newsletter
Distance learning (proposed)
Discussion forum (proposed)
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
(6) Partnership
• National and Regional IP Offices
• National SME focal points in government, private
sector
• Chambers of Commerce and Industry
• SME Associations; Cooperatives
• Incubators, Science Parks, Technology Parks
• Universities; R & D Institutes
• Private Sector Consultants
• SME Finance Institutions (including venture
capitalists)
• Other UN Agencies (ITC, ILO, UNIDO, AfDB)
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO
Thank You
Guriqbal Singh Jaiya
[email protected]
www.wipo.int/sme/en/index.html
www.wipo.org
The Small and Medium-Sized Enterprises (SMEs) Division of WIPO