Licensing Tutorial - Licensing Organisation

Within any organisation there is a potential gap when it comes to the strategic management of intellectual property rights. IP departments, R&D departments and Senior management between them have the skills but no one department has all the skills needed.

Hisotrically separate licensing departments have tended to be reactive and not integrated into their company's strategy. Licensing activity would be driven primarily by outside requests and the licensing department's desire for self-preservation. Material that should have been kept in-house might be licensed out to increase revenue and valuable assets might not be licensed out because no one outside the company asked for a license, mainly because no one outside or inside really knew exactly what IP assets the company possessed.

The recent realisation by senior management that IPRs represent a valuable corporate asset has provided incentives to pro-actively licence out IP. However, senior management still lack knowledge about IPRs, conversely, IP department staff still lack any involvement or training in the strategic implications of the IPRs they manage, and the R&D departments and business units they liaise with are remote from both. The end result is that in most companies IPRs are not being managed strategically at all.

In small companies, R&D management, IP management and Strategic management roles may be concentrated in a very small close knit group or even one person. Paradoxically, this may make it easier for small companies to manage their IP strategically and in a more integrated way than larger companies.

For larger companies though the answer to this problem lies in educating senior management about IP, educating IP staff about the strategic implications of what they are managing and improving the communication and liaison between the various departments who can contribute to an integrated IP strategy.

It is thus not enough to review IP and licensing activity and decide that there is a need for IP specialists in a company. If the company is to gain the benefit of an in-house licensing or more general IP department it must be integrated into the organisation. If it is not, the firm will find that it would have been cheaper and more convenient to employ outside consultants even if they cannot bring the benefits of an integrated IP and Licensing strategy so easily.