Patent Management

Innovation represents both value through creative effort and is a source of competitive advantage, and as such, has always been susceptible to the dangers of imitation. Only effective innovation protection can ensure sustainable business success, but the protection of innovation using intellectual property rights can help capture value. This assertion will serve as a guide in the following chapter on innovation protection of industrial and intellectual property; along the way, we also go into other informal and competitive ways of protecting innovation, such as lead-time. This chapter covers all types of protection such as inventions, trademarks, designs, and more. In doing so, we show why various factors such as globalization and ever-shortening innovation cycles in the recent past have immensely intensified the need to manage innovation. As Joseph Schumpeter, considered the father of innovation economics, showed, patents foster innovation and influence its subsequent commercial success. Thus, the importance of commercial protection rights should not be underestimated, and we begin by outlining how they create value for innovators. Strategic management of patents is hence a fundamental and integral part of technology and innovation management.

A successful patent strategy fits with the corporate strategy. How the company positions itself in terms of products, services, markets, and technologies should also be reflected in the patent strategy.

This chapter examines various forms of patent strategies: preventative, defensive, offensive. It discusses both offensive and defensive patenting and looks at the core actions: more intellectual property rights (IPRs); differentiation; and freedom to operate. This chapter also delves into the various costs associated with these actions. Moreover, it looks at alternative strategies to protect innovation that do not involve intellectual property rights; these include strategies such as first-mover advantage, or secrecy.

A challenge for patent management is to identify ideas worth patenting and to evaluate them appropriately. A structured procedure for the evaluation and selection of patents as well as a continuous review of the patent portfolio are indispensable for cost–benefit optimization. Various qualitative and quantitative evaluation methods have been established for the evaluation of patents, which are presented here.

The importance of patent commercialization has increased in recent years. The worldwide increase in licensing activities makes this apparent. A distinction must be made between two types of patent commercialization: internal and external.

In this chapter, the typical motives and various forms of patent commercialization are explained. This chapter looks at in-licensing and cross-licensing to protect the company’s own products and processes ensuring freedom of action. It also looks at avenues for added value through external commercialization by spinning-off, by means of joint-venture, licensing, or selling the company’s own patents. It describes which marketing channels can be used to commercialize patents. Finally, challenges and central tenants of successful patent exploitation are highlighted.

Successful patent management in a company is rooted choosing the right organizational form. Various internal organizational choices, such as establishing a separate patent department, or directly integrating patent activities into the business subunits, must be done according to the objectives of the patent management. Alternatively, it is also possible to outsource service provision. This requires measures for quality assurance and an integration of external activities into company processes. This chapter also looks at how to prevent piracy and imitation by means of both intellectual property rights and business strategy.

Patent management in a company often involves departmental rivalry and conflict. A partnership between inventor culture and intellectual property requirements can serve as a catalyst for success.

Successful patent management differs from industry to industry. This chapter provides examples from the pharmaceutical, chemical, crop-science, life-science, and consumer goods industries, as well as from electrical engineering and telecommunications, automotive and mechanical engineering, nanotechnology, computer science, financial services and fintech, and the transport and logistics industries. It delves into the peculiarities of each of these sectors and looks at what conventions are used around patenting. While doing so, case studies illustrate the industry-specific characteristics of patent management in each domain, also touching specifics with regard to Start-ups and SMEs.

Successful patent management also differs depending on the technological domain. This chapter looks at technological fields that are on the rise, fields such as biotechnology, nanotechnology, industry 4.0, software, artificial intelligence, and the blockchain. Managing these technologies requires different approaches to patenting and commercialization since they cross-cutout across industries and are still in their early states. Fields such as biotechnology have raised deep ethical and moral concerns, while technologies such as the blockchain questions the industrial-era notion of patentability. In contrast to the nuts, bolts, and processes of patent management, this chapter offers to readers a bit of a wider context as well as a broader and intellectually more mature view on the patent system.

This chapter provides more than references. It looks at some of the broader statistical trends, delves into how to read patent documents, their codes, and classifications. It gives some practical tips on how to search patents, also detailing the large legal jurisdictions, such as the European Patent Office and the European Union Intellectual Property Office. It moreover discusses some of the details of taxation, the patent box, and of comparative and patent legislation at a glance, not to mention the World Intellectual Property Day of the World Intellectual Property Organization.