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I didn’t exactly know what to expect with this book. I know that I was hoping for a very practical “work book” kind of thing, with specific steps that real companies could take. I also wanted something that a person could start using on their own and then expand into their team or organization. I know that there is a real need for something that could be of value to people at different levels of organizations, and even to different kinds of organizations.

Now I am fully aware that this is a very tall order, and normally such high expectations inevitably lead to disappointment (Star Wars I: The Phantom Menace comes to mind). But I know that Mark and his co-authors know more than probably anybody in the world about how you actually make disruptive innovation work in real-world organizations. So if anyone could really nail it - they could. All of which explains why I began reading this book with an unsettling combination of eager anticipation laced with an ‘expect to be disappointed’ kind of feeling.

It is fair to say that the challenge the authors faced in writing this book was significant. They set out to make disruptive innovation practical. Their objective was to provide something that companies could actually act on. In my mind, there are a number of obstacles that must be overcome to achieve that, but perhaps the greatest is simply making sure that the reader really understands what disruptive innovation is (and isn’t).

I am convinced that Christensen’s ideas of disruptive innovation, while well known, are not widely understood. Part of the difficulty just lies in the words themselves, which I feel have taken on a kind of chameleon-like ability to mean a lot of different things to different people. I have noticed that when you say “disruptive innovation” what a lot of people are really hearing is “radical technological breakthrough”, or “superior technology”, or “direct competitive assault”. While any of these may be true in some cases of disruptive innovation, they are neither necessary nor sufficient. Of course, the best examples of disruptive innovation are none of these things (think: rebar and steel mini-mills).

The authors therefore, attempt to weave the basic concepts of disruptive innovation into the fabric of the book. They are helped-along by a foreword written by Clayton Christensen himself, and their own introduction to the book, which together attempt to be a kind of disruptive innovation refresher. I actually found them to be excellent in how crisply they define the domain. However, I am not sure if, on their own, they are enough for someone that has not been exposed to the ideas of disruptive innovation through Christensen’s other books. On the other hand, if you have time for only one book on the subject, I will argue that it must be this one. The reason is that this book goes the furthest in taking disruptive innovation theory and showing how it can be put into practice.

A common complaint that I have heard about Christensen’s books on disruptive innovation is that they are somewhat academic and theoretical. To be fair, he is an academic and theoretician after all. But he is also very interested in making things work in reality, as evidenced by his work with Innosight and also by his support of this book. What makes me so excited about this book is that it really delivers on the need for an eminently practical guide to the things that every company can do to leverage disruptive innovation. The work is based on the authors’ own experience in trying to implement disruptive concepts in dozens of organizations over the past decade.

Mark co-founded Innosight eight years ago with Clayton Christensen as a way to help companies apply the principles and insights that Christensen’s research had produced and which many had read about in his books including The Innovator’s Dilemma and The Innovator’s Solution. This book is exactly the kind of volume of accumulated learnings that I have been craving.

At its core, it is a methodology for embedding disruptive innovation principles in the culture and activities of an organization. It is broken-down into four parts that take the reader through the process. It is filled with actual examples and case studies of each step and principle with companies and products that are familiar to the reader including: iTunes, Swiffer, Wii, Skype, YouTube, Google Adwords, Metro newspapers, Whitestrips, eBay, and more. These cases were probably the most satisfying part for me, and I would recommend the book for these if nothing else.

Fortunately, there is a lot more on the menu. The book is very readable, moves quickly, and doesn’t ever get bogged-down in theoretical or vague “management speak”. In fact, it is a lot like a workbook and includes a variety of templates and forms that you can copy and use right away to organize your thinking. I found these to be extremely valuable as they provide simple frameworks that allow you to translate what you are learning directly on to your own business model and situation.

In short, I was very satisfied with the book, and am recommending it to everyone. I think this is absolutely the best business book of 2008. And, for what it’s worth, I am currently starting my second read-through as I am anxious to begin following the exercises in the book in detail with my own company. Please add your comments and let me know what you think of the book. I will also be posting some videos of the interesting bits of my interview with Mark Johnson here on the blog so check back often!

This is much more serious statement than many realize. For some time a lot of people have been predicting that the web browser will supplant the traditional Operating System as the layer for which most applications will ultimately be designed. We now see that this vision has the very real potential of becoming reality. Companies such as Salesforce.com and many others have shown that industrial-strength applications can run in web browsers, and Google’s own applications which compete with Microsoft’s Office suite offer a tantalizing taste of what is to come.

But the browser itself has long been the limiting factor. Among the biggest problems with the current crop of browsers are their poor memory and process management. Sophisticated web apps can choke a browser, and the problems get worse when there are multiple windows and tabs open. Microsoft’s Internet Explorer which is used by 70% of the market has been particularly slow to evolve in this dimension and seems to have been spurred-on mostly by the competition - particularly Firefox. There is little doubt that IE wouldn’t have moved very far without the Firefox threat looming.

I think a lot of people have missed the point with Chrome. Google doesn’t really want to compete in the browser market. I believe that their intention is to move browser technology in the direction it wants to go - toward making browsers a more robust application platform. This is the reason that I would argue Chrome will ultimately turn out to be disruptive even if it never consolidates any substantial market share. Many have argued that Chrome’s new features will not be difficult for the market leaders such as IE and Firefox to adopt and that will obviate any demand for Chrome. I think that this is exactly what Google wants. They are lighting a fire under the IE development team. They may or may not want to be the new king of the browser hill - but they certainly want browsers to be capable of delivering the new generation of applications and services that they envision.

That’s why Chrome is not as disruptive of other browsers as it is of traditional software applications like Office and operating systems such as Windows and Macintosh OSX. When the browser becomes the platform of choice for application delivery, we will be able to get our software over the web, and the operating system I use (currently: Macintosh OSX by the way), will recede into the background. In fact, if I am getting my apps over the web, why should I pay a premium for a commercial OS at all when there are free alternatives that support a modern browser just fine. Chrome is disruptive without specifically needing to disrupt any particular product directly. This is because it is going to change the balance of power between traditional computing platforms and the web-based computing juggernaut on the horizon. I think Chrome will prove disruptive whether anyone uses it or not.

Sir Ken Robinson (at TED) makes the point better, and more humorously, than I every could. In this TED 2006 talk, he argues that schools are killing creativity. This has profound implications for innovation and even for national economies. Please to enjoy…

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As a recent graduate of a major MBA Program, I can confirm that, not only is IP management not on the menu, it isn’t even understood among the faculty exactly what it is or why it is important to business. Naturally, there is an elective course on business law that contains a short segment (1 day I think) on patents and other IP. One of the innovation courses covered it in half a lecture. I know some schools even bring in a law professor to teach an entire course on IP. But obviously none of these has anything to do with teaching students about the importance of managing IP as a core business process.

I find it difficult to understand how IP management hasn’t become an integral part of every business strategy course, much less all of those courses on innovation and entrepreneurship that are now so popular at business schools and executive education programs. They should all be dealing with IP management as a central issue. In support of this modest proposal, I offer three very simple arguments:

1. IP is now the most valuable business asset class in the world

How is it possible that the world’s most valuable business assets receive virtually no attention in an entire MBA education?

It is astonishing that we are not talking to students about how to manage these assets, especially in light of the many, shall we say, more esoteric management subjects that receive in-depth treatment. I remember one experience in particular that illustrates this…  We were studying a specific drug market in a business economics course and the professor was engaging in his best statistical gymnastics to explain why successive waves of drugs had succeeded each other in dominating the market over a period of 40 years. Afterwards, I approached the professor and explained that specific patents and their invalidations and expirations was actually the true explanation. He was quite surprised at this as he was to learn that patents expire and that this can have a significant market impact.

2. IP is a strategic pillar of most of the companies that business students study

How can we study companies that rely on IP, and whose valuations are based mostly on IP, without ever mentioning IP?

Business students are required to delve into virtually every dark corner of dozens of different companies including their history, balance sheets, management, strategy, and finances. The goal is understanding what makes these companies succeed, fail, or otherwise. The irony is that, even though many or most of these companies have leveraged IP as a key part of their strategy or rely on it for their success, this fact never arises in business cases. It is easy to simply say that managing IP must be contained in Porter’s “five forces” - probably under “barriers to entry”. But, this is hardly the same thing as learning how to manage IP.

3. Managing IP is what’s next

Innovation, technology, and entrepreneurship have been the hot topics at business schools around the world for the past 10 years - minus the management of IP.

It would seem unlikely that the management of IP would not be among the most important subjects to address in an innovation and entrepreneurship curriculum. But, I took every possible course on these at what is arguably the best school in the world for these topics, and I can assure you that it is conspicuous in its absence. In theory at least, the top business schools are at the leading edge of management. These are the platforms on which you can gain a view of the road ahead - to see where business is going next. Unfortunately this is not the case for IP management. No only are they not making it a core part of their curriculum to prepare students to integrate IP management into their strategic and operational thinking, they were not  looking ahead five or ten years ago to the explosion of business investment and interest in IP that we are now experiencing.

Ultimately, the most important obstacle to integrating IP management into business curriculums is finding people who know something about it and can teach it. The worst thing that can happen would be for business schools to start putting IP management in the curriculum now - without any real expertise in the subject. This is of course normally what b-schools do. When entrepreneurship was hot - they added it (but not the people who knew anything about it). The result was that many existing professors suddenly became experts in the subject. The truth is that courses nominally about entrepreneurship are really about raising venture capital and worshiping sexy technology.

What the world’s universities need isn’t classes about managing IP. What is needed most are business professors in every subject who are aware of the importance and role of IP in business. Only then will students be exposed to the reality of IP as a key aspect of management and begin to see how it is integral to strategy, competition, financing, partnerships, employment, innovation and, well… business.

The second piece of innovation news was an announcement by Perth-based venture investors Braveheart of a 15-year commercialization agreement with Aberdeen University. The deal gives Braveheart first refusal rights to IP in certain areas, and appears to offer at least £5m over 5 years, with a dedicated fund thereafter that will include other investors. Braveheart also has similar deals with the University of Strathclyde and the University of Edinburgh. The stated objective is the fill the proverbial “funding gap” and accelerate Scotland’s success in IP commercialization. This kind of long-term partnership between investors and universities seems to be getting more popular.

VCs are Too Big
One problem is that many of today’s funds have simply become too large to invest in innovation. Bets on disruptive ideas or radical new technologies that are unproven tend to be smaller. Remember that being “unproven” is the attribute that both risk and innovation share - by definition. But if you have a billion-dollar fund, it’s impractical to make investments averaging less than $10m each. The sheer number of investments in the portfolio would be overwhelming to try to manage.

Performance
However, there is a more important problem, and that has to do with returns. The fact is that many VC funds of recent vintage did not perform as hoped. Too many investments that were “disruptive”, “radical”, and “game-changing”, simply turned out to be “game-ending” instead. VC’s have largely responded by moving their investments down-stream to the growth phase. Many have commented, and I think it is true, that VC’s have become just another player in the Private Equity world. That means that they invest in growth not innovation.

“De-Risking” Innovation
But the amorphic nature of the word “innovation” never ceases to amaze me, and these PEs in VC clothing continue to wield it liberally in defense of their post-innovation investments. As Weissman insightfully notes, VCs continue to talk big about investing in “innovations” as long as they have been “de-risked”. This simply means that they want to take the “unproven” out of both innovation and risk. Of course, when you do that all that remains is growth. That’s not innovation and it obviously isn’t risk.

The Funding Gap is Real
The interesting thing is that all of this seems to prove that there is a funding gap after all, which Weissman is arguing doesn’t really exist. He says it is merely an “expectations gap”. Although that may be true, that gap exists in a very important place: the minds of the investors. If there is a gap in their expectations, then I would expect that to manifest itself in their investments - which is exactly what a “funding gap” is.

I think what has happened is that the established VCs have sort-of “grown up” with their investments. I look at it as like an elementary school that changes to being a high school and then a university as their students progress, rather than admitting a new crop of kindergarten-ers. Over time, VCs seem to have lost interest in the fresh new faces. Certainly they invest in new companies, but many of them aren’t as “new” as they may appear. They invest in people they know, people that they have invested in before, or people who have a “proven track record of success”. Those are all acceptable things to invest in, but investing in your friends it isn’t the same thing as investing in innovation.

What Is Next?
I think that this has created a situation that is rife for disruption. Investors willing to make smaller investments at earlier stages are likely discover that the higher returns associated with things that are “unproven” are still out there for the taking. In fact, Weissman may be proof of that. To bolster his argument that there is no funding gap, Weissman provides his own company as evidence that VCs still make early stage bets on innovation, while criticizing other VCs for not doing so. So which is it Carl? Have VC’s mostly moved away from risk and innovation, or are they mostly like you? You can’t have it both ways. My own experience is mixed. I have certainly interacted with a lot of VCs that aren’t bashful about their departure from the rough and tumble world of early-stage venturing. But, I have also met several new VCs over the past year that are talking about filling this gap as a core part of their investment strategy. I think that the funding gap is real (as is Weissman’s “expectations gap”), but that innovation is not dead - it’s just hungry.

The Debate: Basically the debate can be boiled down to this:

The 37 Signals school of thought is that the mere act of reducing features can add value to software for many if not most users, and is its own form of innovation.

The counter-argument articulated by Dharmesh is that most of the interesting problems that software can help solve aren’t simple enough to be solved by simple software. His argument is that software should be no more complex then is necessary to meet the need.

What vs. Who

I actually think that both “sides” in this debate are saying something true, and that the tension between them is actually artificial in that it is mostly based on another factor. As Dharmesh himself points out in his post, “Many can (and have) argued that nobody uses more than 20% of the features in Word. That’s likely true. The issue is that it is a different set of features for each user, and within that set, one or more features are very important.” So I think that the question is not how many features to offer, the correct question is how many people to offer the features to.

The example of Word (and a lot of other software from the past 20 years), is of a product that needed to fulfill the needs of most everyone and therefore had to include a lot of functionality to meet everyone’s needs. But this requirement is really driven by the business model which led to loading every conceivable capability into a single, gigantic product. When you look at any particular person or group, it is much easier to identify what my friend Clayton Christensen calls “jobs to be done“, and the features and capabilities that are needed naturally fall out of that. More importantly, using the “jobs to be done” concept clarifies which dimension of performance defines the correct innovation trajectory.

It’s the Business Model

I would argue that for 37 Signals and others in the new generation of Web 2.0 and Software as a Service (SaaS), what has changed isn’t really the philosophy - it’s the business model. These companies build and deploy software in a completely different way (as internet services) and into much more sophisticated and heterogeneous markets. The result is a different software business model with very different economics. It enables, and I would say even encourages, software companies to form solutions around much more homogeneous markets defined by common “jobs to be done” and a shared vision of the dimension of performance.

What this leads me to is the concept of “requisite complexity” which I first encountered many years ago while I was studying innovation at Cambridge University. The idea is that solutions will not be less complex than the problems they solve. I would hypothesize that neither side of the debate would disagree with this idea (I hope - anyone out there want to speak to this?).But, the only way to reconcile the very real conflict between these ideas is to understand that they represent different business models (eg. the traditional mass-market software application vs. jobs/market-specific software).

Many in the Web 2.0 world are very enthusiastic about Christensen’s “Disruptive Innovation” thesis because it appears to offer a roadmap for success. I think that they are right, and I am satisfied that the success of Salesforce.com is an example of classic disruption. But I also think that this new generation of software entrepreneurs would be wise to take another page out of Clayton’s book (literally!), and make sure that they understand and align their solutions with the “jobs” that their customers “hire” them to do.

So this may be a starting formula for software success right now:

identify the “jobs to be done”
(and understand what that “market” looks like”)

+

build solutions of “requisite complexity”
(not “less” or “more” - but “just right”!)

+

wrap them in the right business model
(and delivery mode etc.)

To me, Web 2.0 is really about a new business model for software, and not really about technology (though technology has been a key enabler). This helps explain the profusion of smaller, more specialized, software companies and the blurring of the lines between software “products” and “services”. My own company offers IP management software and represents this trend. As a specialized vendor, our solutions have come to be defined by a unique “jobs to be done” profile. Ultimately, our evolution toward the SaaS business model has been driven by the economics of serving these kinds of specialized markets. This model allows us to deploy many different versions or “flavors” of the product to address the need for requisite complexity for each “jobs to be done” profile - and make money. Said more simply: our objective is to profitably offer everyone with IP just the software they need to effectively manage their IP. Simple to say - difficult to do!

In my session, I briefly recounted Knowligent’s experiences innovating a complex enterprise system and the way that customers essentially negotiate to introduce their ideas into the design of the product. Eric’s objective for bringing me in to lecture was to provide proof for his overarching thesis - which is essentially that a lot of innovation comes from end-users, and companies that embrace this reality are better off for it. Of course this is absolutely true, and Eric has become a sort of collector of cases and evidence in support of this “Open Innovation” idea. The students were very intellectually engaged and a lively discussion ensued over the basic issue of whether customer-driven ideas can be trusted to lead a company’s innovation in the right direction. It was typical of MIT - very probing, questioning, and spirited - and it was a lot of fun! A few things came out of the discussion and my subsequent pondering after that I feel are particularly interesting and useful…

1. Enterprise software is actually a pretty good example of an industry where innovation has been heavily user-driven. Many if not most business software companies originated out of home-grown IT projects within companies for from corporate “wish lists”. Even after a project has spun-out, the vendor tends to be dependent on a small group of corporate customers for at least the first few years of their development, and these customers can exercise enormous power over the development trajectory of the product.

2. However, although a majority of ideas for new features and capabilities originate with end-users, only a small subset tend to have broad appeal. That is, customers can quite easily produce a large volume of ideas for new functions mostly because they have so many jobs to do. But these features make for complex, and usually expensive, software. If the vendor isn’t vigilant in controlling the code base, this significantly restricts the appeal of the software and I think that this can be a very dangerous trap for a software company to fall into.

3. More importantly, it is arguable that these user-driven features aren’t really “innovation” at all. Just because a customer demands certain features doesn’t mean that they are innovating for you. Much of the time this is really just “invention” (as distinct from “innovation”), and often it isn’t even that. The danger is that companies may come to think that they are innovating because they are adding a lot of new “features” to their products.

4. Enterprise/business software seems at the moment also to be a good example of another interesting theory of innovation - namely Clayton Christensen’s idea of “Disruptive Innovation”. Disruption usually happens when new products are introduced that actually offer less of the kind of functionality traditionally demanded by the existing (and influential) customers. So, running counter to the urge to create customer-driven “bloat-ware” is an urge to create software that is actually less functional but which may be easier and cheaper to deliver and use and is frequently innovative in other dimensions. For examples, I point to Google Docs, 37 Signals, and Mint.com as just a few of my personal favorites demonstrating this kind of disruptive innovation in the world of software. In other words, the current tide of “innovation” in software seems to be moving in the opposite direction than the one that big and influential enterprise customers may want to go. As the theory predicts, over time these offerings will likely become ever more functional and ultimately displace their predecessors. It’s this changing of the dimension of innovation that makes disruptive innovation so powerful.

The question that comes out of all this is whether your biggest and most influential customers are likely to lead you in a direction that makes you more or less innovative. My own feeling and experience (from the world of management software) is that involving customers and end-users in driving your product design usually makes you more inventive but can make your products less innovative overall. It is probably true that this will be different in other sectors. However, at the very least this supports the idea that there is a need to carefully evaluate the direction your customer input is driving you and to distinguish between “inventiveness” and “innovation”.

1. Hold-on to the past
Redesign your new IP management software until it works exactly like your old IP management software.

You need new software because the old has made it very difficult to do your job. It has become a problem in virtually everything you do. After literally years of struggling with it, you have finally built-up enough organizational will to go through the pain and expense of moving to a completely new platform. But, as we all know, change is difficult (see #4 below), and there is always a countervailing pull to return back to the familiar. There are always people who will oppose change, and the pressure to remake the new system in the image of the old one will quickly be overwhelming. Give-in to the urge, and start pressuring your vendor to “adapt” their system to your “needs”. This is the most effective way to make a project expensive and time-consuming. Most importantly, this is how you make really bad, bloated, and buggy software.

2. Delegate
If you want to end up with IP management software that can’t support your IP management, then don’t involve your IP managers.

Make sure that you assign the project to your lowest-level support staff. Remind everyone that these are the people that are directly responsible for most of what the software does anyway. Because these people have no real authority, they will never be able to consolidate the necessary resources (see #3 below), make essential changes to the organization’s management processes (see #4 below), or compel anyone to use the software (see #5 below).

3. Focus on the cost
IP management software should be viewed merely as another cost of doing business that must be aggressively contained.

Other major expenditures such as patent filing fees and management salaries are obviously investments which ultimately are expected to produce tremendous returns. In this light, make sure that you find the cheapest vendor, or if not, then make sure to bully the vendor you do select into subsidizing your implementation. Remind them that you are a very important customer and that, if they make you “happy”, their business will ignite with the white-hot fury of a thousand melting suns. Later, when you are shouting at them for “under-delivering” be sure to hang-up before they remind you that you paid them for only about a fifth of their actual effort. Although you have plenty of direct evidence that this is true, you must balance this with the fact that everyone knows software vendors are notorious scam-artists.

4. Don’t change a thing
Avoid making essential changes to your IP management practices and processes.

Obviously most of the benefits of your new software cannot be realized without matching changes in how you do things. Your IP management processes have to change, or they won’t be any better than before. (It reminds me of the TV ad where the people think that their life will change because they have new telephone service.) But once you start down that road it can lead to a lot of unsavory outcomes. It can even mean changing people’s assignments! Of course, this cannot and must not happen. Change must be something that occurs only in the abstract - in the “software” realm.

5. Don’t turn it on
Ultimately, the most effective thing you can do to prevent a successful implementation is to simply refuse to turn the new IP management software on.

The most common, and easiest to use, method for doing this is to tell the vendor that you are not “happy” with the software. If they get pushy and want to know why you are unhappy, or what they can do to resolve it, just tell them that the whole experience has been “bad” and that you don’t “like” it. Remember that most of the pain of moving to new IP management software is the change that it will cause (see #4 above) - the monetary cost is nothing compared to that. So, even if you have gone through all the trouble and expense of getting new software, rebuilding it to match your old system, and bullying your vendor into doing most of the work for free, remember that most of the pain comes after you “go-live”. Just don’t do it

1. Full-fledged IP Protection
2. Patent and trademark control
3. Trade. IP is mainly to be licensed out or sold off.
4. Pure branding.
5. Support core R&D

What is interesting about this is that numbers 2 and 4 really don’t relate to patent strategy at all - but to trademarks and branding. Therefore, there really are just three distinct “scopes” for patent strategy here. The first basically refers to the method of trying to protect every possible thing in an effort to block entire spaces. Scopes 3 and 5 are coherent in that they clearly identify their motivations and the kinds of value they are trying to generate. For scope 3, it is Licensing, and for scope 5 it is Practicing.

So, I found all of this interesting for the way that it demonstrates how murky IP management remains, and just how rare it is for managers to think clearly about how to integrate IP into their business models and strategies. It’s also interesting that a major conclusion of the study is the strong shift toward scope 1 (trying to use IP to block entire spaces) as the new “dominant practice” in IP management.

Luckily, finding the answer to this question is not as difficult as it might appear. We simply have to return to what we know. A friend of mine is a professor of engineering at MIT and an expert in metals and structural failure. He likes to recount a story to his students that illustrates what I mean. On September 11, 2001, as he drove home from work he was pondering why the World Trade Center towers had completely collapsed. His first thought was that he would need to examine and analyze the details of the engineering of the WTC buildings in order to answer this question. But, he quickly remembered that he already knew everything necessary to understand what caused the collapse (and what didn’t cause it). When he got home he wrote out those things (he calls them “fundamentals”) in a list - things like the temperatures at which aircraft fuel burns and steel melts, and the weight of the airplane relative to the weight of the building. The list was surprisingly short, and formed the basis for a paper he wrote that has become the most highly cited on the subject and of a subsequent NOVA program.

My point is that it is easy to become confused about how to think about intellectual property. But a review of the “fundamentals” can be very helpful. So, here is my attempt to return to what we know.

What We Know (the “fundamentals”):

1. MECHANISM: First, we know that intellectual property provides the owner with the opportunity to prevent others from using or doing something in business. This is literally how one goes about enforcing the rights of a patent and is fundamentally a legal process. I like to think of this as the mechanism by which IP delivers value.
2. MOTIVATION: Second, that opportunity can produce different kinds of value for the owner. In other words, there are different benefits that IP owners can receive by preventing someone else from doing something. In my mind, these as the motivations for owning IP. In case you are wondering, this is where my “Four Kinds of Patents Value” fit.
3. MODE: Finally, there are a lot of different contexts, business models, and strategies that these motivations can support or be a part of. To me, these are the modes in which IP owners leverage IP to pursue their business objectives. Although there have been a few traditional modes, there seem to be more and more lately, and they are probably limited only by the human imagination. Incidentally, this is really what most people are referring to when they talk about IP strategy (or “innovation” or “IAM”).

What it Means:

I believe that there are two conclusions from this that are of immediate and tangible value:

First, this clarifies why it is so important to involve different people with different skills, knowledge, and perspectives in IP management. Said another way, this makes it more obvious why companies that bring people from across the organization together to participate in IP management are consistently more successful.

Second, it is essential to remember that the mechanism and motivations of IP management don’t change over time (or, not much anyway), and they are not something managers have any control over. What managers have control over primarily are the strategies or modes they use to leverage IP.

The benefit of this realization is that it allows managers a relatively simple framework for evaluating any IP strategy. To produce value, an IP strategy (mode) must combine enforceable IP (mechanism) with the promise of generating at least one type of value (motivation).

Unfortunately, what I see too often is management that hasn’t identified its specific objectives (motivations). In other words, they haven’t decided specifically what types of value they want from their IP - usually they want to pursue them all. This kind of IP management is expensive and largely pointless mostly because it doesn’t provide any way to decide which IP to pursue (or not to pursue), or for that matter, when, where, and how much. And, isn’t making those decisions mostly what managers do? It is impossible to visualize effective management in this situation.

I also think that the failure to define the core motivations for IP strategy explains why we are seeing such a strong shift towards what Markus Reitzig calls the “