Smart Companies Can Make Millions By Applying Agile Approaches To Patents
Robust patent portfolios focused on maximum coverage of key selling points and technology chokepoints should be built using a Scrum team-based approach that features incremental changes, continual improvement, and rapid response to a changing environment. Putting together a Scrum patent team allows companies to protect their most valuable differentiating features quickly and with the lowest overall costs.
Using agile strategies, companies can build robust patent portfolios that can make them far more money than traditional approaches. The key is to create a patent team that uses Scrum methodologies, including many incremental changes and rapid response times to shifting market environments.
The standard approach to building a portfolio isn't fit for purpose for several reasons. First, it takes too long to grow patent assets organically if they are outside the company's core competencies. It's also overly reliant on internal ideas as opposed to all available approaches. Finally, it fails to keep up with market conditions and changing customer needs.
Following a Scrum process means that companies don't have to rely solely on internal resources to build their teams. External experts enable patent portfolio development in the same way expert code smiths create software. In the patent field, these experts are patent brokerage firms, and they add valuable perspectives and experience to help a patent Scrum team meet their goals.
Patent brokers help Scrum patent teams build and protect products faster
As their name implies, patent brokers buy and sell patents on behalf of their clients. Almost all technology companies have team members responsible for evaluating new, internally developed inventions. Still, only a small number have team members accountable for acquiring patents to advance their product development needs or for selling technologies they no longer need. Patent marketplaces can fill these needs, but most of these sites don't provide the expertise in understanding the value of patent assets the way a broker would.
Louis Carbonneau is the Founder & CEO of Tangible IP, LLC, a global leader in patent brokerage with over 3,500 patents successfully brokered. He has strong thoughts on adding external brokers to a Scrum patent team.
"It may take over a decade to build even a modest patent portfolio organically given the current patent process, and few companies have the luxury of time in a hyper-competitive world. They must look at getting a head start by building their patent portfolio through acquisitions. We have seen this phenomenon accelerate recently with several Chinese companies who wish to become global players rapidly but initially came to the table with very few IP assets."
Scrum patent teams need to be flexible to change and adopt a profit center stance
Holding on to technology assets beyond their useful life costs companies billions of dollars a year in maintenance fees and annuities, the ongoing expenses for maintaining patents once they become granted patents. Too many companies are overly sentimental about these inventions. They don't recognize until it's too late that they could be recovering some of their development costs by using a broker to sell these assets.
Kent Richardson of the Richardson Oliver Law Group discusses this potential when he says, "The market for trading in patents is about $2 billion every year. Companies don't have to invent everything themselves. You can now buy patents that you need for your business from willing sellers whose interests have changed." Richardson Oliver Law Group recently published a report providing details on the 2019 brokered patent market, including the average asking price for a US patent of $280,000.
Scrum methodology requires the team to continually look at the changing environment and make quick decisions about what projects they are going to continue to pursue and which ones they are going to abandon. One piece of software is much like any other, and there is no attachment to one portion of code over another. The same needs to be true of technology assets. They are a means to an end and are only worthwhile when applied to a process or product that brings an advantage to the company.
When the company no longer needs technologies, they become a source of cash that goes directly to the bottom line since the expenses for developing them have already shown up on the books.
Every team member brings different expertise to the table
Successful Scrum software teams divide large projects up and apply different skill sets to each of the parts. The same is also true of a Scrum patent team. The patent broker brings a specialized skill set to the group that most technology companies don't have, according to Carbonneau. "Several Fortune 100 companies have retained our firm when they decided to divest some of their patents, as they understand very well that this is a very complex process that requires the high touch of a professional broker who have a relationship with a large buyers network and understand how to best market those assets for a sale, using a business model predicated on success that yields virtually no risk to the patent owner."
Specialized expertise and methods are also needed when the Scrum team needs to buy patents. Richardson has written several articles on what companies need to think about when beginning this process, including this list of ten best practices.
Companies that follow an agile framework for their Scrum patent teams are the clear winners in their industries. Some of the world's most innovative companies, including Apple, Google, Intel, and up-and-coming Chinese companies like Oppo Mobile use patent brokers to ensure they get the most return on their technology development dollars by selling portfolios without remorse. These companies innovate faster by also using brokers to buy new technologies they need that aren't part of their core competencies. In the end, the focus, as it should be, is on developing products that thrill customers, not on the patent assets individually.
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