The short answer: it’s a lot of things, and a lot of people need it.
I’ll just say it… The concept of managing intellectual property is a bit elusive. For that matter, the idea of intellectual property itself is often a bit vague for many. This can make explaining what IP management software is to those with little knowledge about IP extremely challenging. But it may surprise you that it can be just as difficult to describe IP management software to people who are experts in the field of IP. Why is this? I think it’s because there are a lot of different things that various people do with IP and a lot of different people involved. My goal here is to break that down into some very simple categories to make it easier to understand what IP management is and what kinds of software you can get to support it. Before we can do that, I have to explain a few things…
First, IP means different things to different people. Just Google the term “IP Management Software” and you will see what I mean. For starters, you will see that “IP” itself has multiple meanings. For instance, to a bunch of people out there IP stands for “Internet Protocol”, and they have their own management software to help them do whatever it is they do. Beyond that you will find software for the media and entertainment industries, software for lawyers, and even software for software companies among a variety of other things. It almost feels like “IP Management Software” is a grab-bag: reach in and you never know what you might find!
Secondly, there are multiple kinds of intellectual property: patents, trademark, service mark, registered designs, trade secrets, and more. To complicate matters more, intellectual property has even become a kind of catch-phrase associated with corporate innovation and competitiveness and is often used almost interchangeably with the word “innovation”. At this stage in the computer “revolution” it should surprise no one that there is a software application for just about everything and therefore we are not surprised to find “management software” for virtually every flavor of intellectual property, as well as for virtually every role and activity associated with it.
Lawyer or No? At my company, we get a lot of calls and email inquiries about our IP management software from people who are actually looking for something completely different. I can usually tell right away which ones are actually interested in “Internet Protocol” management and happily inform them of their wrong turn. However, for a long time I had a more difficult time determining whether the rest has found the right place or not. That is until in desperation one day I seized on a simple diagnostic which I now use every day that helps immensely to organize this mess. It is a simple question that divides the IP (intellectual property) world into two major camps. I simply ask, “Are you an attorney or patent agent?” If the answer is no, then it is possible that have found the right place and a few follow-up questions will easily determine if they have. If the answer is yes, it is almost certain that they are in the wrong place.
A bit of background helps… Historically intellectual property was always primarily a legal process. It was something lawyers do. IP is a legal entity. Filing, amending, prosecuting, maintaining, litigating - these have been the processes people associate with IP for generations. Companies and other organizations have almost universally thought of IP as a legal process, and therefore responsibility for it was almost always given to the general counsel’s office. The main purpose of having IP was to protect the competitive position of the company’s products and markets.
Then, something happened: people started to make money directly on IP. Of course this was already happening in media such as music and movies and in software among others. But other people got in the game. For instance, universities started to make money licensing their patents. And their “commercialization” efforts led to the Bayh-Dole act and a lot more “technology transfer”. In industries where IP is relatively more important such as pharmaceuticals, patent licensing has become a major industry and has earned sometimes stunning amounts of money for the inventors and their employers. Small technology companies have come to see this as a viable business model in its own right. Trademark licensing is now a big and sophisticated global industry. Suffice it to say that a whole range of business processes have grown up to support making money on IP.
The 2 Kinds of IP Management Software
So, that’s how I divide the world of IP management software: it is either designed to support legal processes or it is built to enable business processes. This makes a lot of sense anyway because these processes are quite different. But, you might say, they both ultimately serve the same purposes and must be integrated in some way to be effective. This is absolutely true. It is impossible to imagine including IP considerations in the business decisions, strategies, and even business model of the organization without that having a direct and profound impact on the legal processes: which IP to obtain, what types, in what jurisdictions, how much, and so on.
However, I think it becomes clear that these decisions are precisely what the business processes of IP ought to support. Therefore, the managing IP is really just whatever the business does to make smart decisions about IP that support the organization’s key objectives and strategies. Said another way, managing IP is all about integratinge the legal processes of IP with your business strategies and objectives.
It turns out that although this is really a very simple concept, it is easier said than done. There are a number of things businesses do when they “manage” something that have historically been foreign to IP. Management requires a lot of visibility and control over the object of management. For instance, managers typically want to know things like: why do we need it, what will it cost, what has it earned (or will it earn), what business objectives does it support, who is using it and how, who else has some, and even, what it is worth? Questions like these are not easily answered by lawyers. They’ll be happy to give you their best guess of course, and they are used to doing it because so few companies can answer these questions for themselves, but it’s really not what they exist to do.
The 2 Kinds of IP Management Software Customers
From my experiences with Knowligent, organizations that are shopping for intellectual property management software generally fall into 2 categories. To determine which they are, when a customer contacts us I will always ask the following question before we even start the conversation: “Does your organization have internal patent attorneys, or do you rely on outside patent counsel?”
The reason I use this question is that almost universally the companies that have in-house patent attorneys are looking for software to support their legal processes. I don’t know exactly why, but it seems that when a company is conducting it’s own patent prosecution, this process seems to take center-stage and command the focus and attention of the organization. Or it may be the other way around. In any case I have found that companies doing their own patenting tend to think of it as primarily a legal process. There is no particular reason why these organizations don’t need to integrate it with their business decisions, but they generally don’t seem to think about it in that way.
In contrast, organizations that contact us who rely on outside patent counsel for their legal processes are almost always looking for software to better manage those processes from a business perspective, and to integrate it into their overall strategies and objectives. Sometimes they are focused on controlling or justifying the cost, and other times they are interested in increasing IP-related revenue, or (rarely) both. Whatever their goals, any organization that is outsourcing patent prosecution simply doesn’t need software for managing the minutia and legal details of IP. If they use outside counsel, it’s a safe bet they are looking for business IP management software.
It has been a consistent trend over the past decade or so for organizations to move the legal processes of patenting out to outside attorneys and agents. This may be because it has become so much more complex to obtain global IP protection, or it may be part of a larger trend toward outsourcing based on efficiencies. Either way, it means that fewer companies need legal IP management software, and more are ready to understand the value of business IP management software.
One note of caution: Most IP management software vendors will describe their offerings as containing both legal and business processes. To an extent this is true. Most IP management software contains some elements of both. However, in essence they all cater to one side or the other. If the offering is designed to support “docketing” (which is a common term for the legal processes), its other functionality will not be oriented to non-lawyers, and the reverse is also true.
In a future post I will present my own survey of the field of IP management software.