The pandemic reshaped the business world, forcing a rethink of IP strategy.
With the AI revolution around, enterprises are racing to launch AI-driven products. The AI patenting boom is set to eclipse other breakthrough innovations of the century, like 5G.
Complicating matters further is the push for innovation aligned with Environmental, Social, and Governance (ESG) goals.
In this rapidly changing innovation landscape, agility in IP allocation isn’t just smart—it’s survival.
Enterprises otherwise face the risk of missed opportunities in emerging technologies, inefficient resource utilization, and reduced competitiveness.
To top it all, patents are expensive to get and maintain. Hence, strategic patent portfolio creation demands informed use of the IP budget.
Here are five ways to effectively use IP budget and thrive in the dynamic business environment.
- Understanding the Patent Landscape
Companies often oscillate between aggressive patenting and neglect, risking coverage gaps.
The first step in effective IP budget allocation involves evaluating their patent coverage to identify areas of under and over-patenting.
Identifying the gaps is crucial to helping you take the necessary steps to ensure the right amount of coverage commensurate with the opportunity in that space.
To perform this assessment effectively, enterprises can get a patent landscape study conducted. For instance, such studies can offer white space analysis i.e. areas with fewer patents, suggesting opportunities for innovation or market entry with a reduced risk of patent infringement.
Additionally, enterprises can utilize patent management software that offers one-click patent portfolio views with several filters. For instance, looking at patents around a particular product line, technology, geography, etc.
- Thinking Long Term
Effective patent portfolio management is more than safeguarding immediate inventions; it’s a foresighted strategy that aligns with your business goals and adapts to market evolutions.
Patents offer a 20-year protection window, making it essential to consider their long-term relevance to current and emerging market trends.
- Knowing the Purpose of Patent Portfolio
Understanding the ‘why’ behind crafting a patent portfolio is pivotal to preventing finding yourself short on essential patents or sitting on a pile of patents offering low or no value.
Whether you’re developing a defensive portfolio, aiming for acquisition, asserting patents, or licensing them, clarifying your purpose provides strategic focus. This ensures you select ideas that are not only promising but also align with your business goals.
Engaging innovators is vital to a patent program’s success; otherwise, even a well-crafted strategy may fail. Here’s the approach:
- Educate: Show them why patents matter.
- Motivate: Use incentives to spark interest.
- Simplify: Make disclosures easy and intuitive.
A clear purpose steers resources, focuses efforts, and unites the team.
- Selecting Promising Ideas
Zeroing in on ideas with high adoption potential, patentability, and business value requires rigorous screening by various stakeholders.
A platform that unites inventors, managers, and patent attorneys for real-time collaboration and idea refinement is crucial.
Additionally, data-driven insights such as the likelihood of allowance, expected time to allowance, and comprehensive cost estimates for patenting are key for informed IP budget allocation.
- Pruning Your Portfolio
Holding onto irrelevant patents drains budgets and hampers the development of more pertinent ones.
Companies often channel their patent budgets into seemingly promising ideas, only to face market indifference, stalled development, or mistimed entry.
If unchecked, IP budgets balloon. Patent maintenance fees, demanded thrice in 20 years by the USPTO and totaling around $10,000 per patent, can consume a significant chunk of these budgets.
Realigning your portfolio with the current IP landscape is crucial in these situations. This might mean pulling out from non-performing regions or product lines.
Whether you’re doing an in-house analysis or hiring consultants for a landscape study, the goal is to reinvest resources for better returns.
Start by listing all your patents and deeply understanding each. Group them into categories, rank them based on objective measures and other criteria, then shed the low-priority, low-value ones.
Trim patents that don’t align with your objectives. Unsurprisingly, over 85,000 patent applications were withdrawn or abandoned in the U.S. alone in 2023.
Parting Thoughts
Patents are more than just legal documents; they reflect your company’s innovative spirit and strategic foresight. The choices you make today in allocating your IP budget will echo through the corridors of your industry tomorrow.
It’s not only about avoiding the pitfalls of over-patenting or underutilizing resources; it’s about seizing opportunities in emerging technologies and staying ahead in a competitive market.
