This Slideshare presentation is a partial preview of the full business document. To view and download the full document, please go here: http://flevy.com/browse/business-document/how-to-improve-your-innovation-roi-with-early-stage-patent-expertise-1208 DESCRIPTION In this in-depth article Jackie Hutter, top IP Strategist and counselor to innovation driven organizations, writes about how to improve the ROI of innovation outcomes by including patent expertise in the front end of the innovation process. The article also includes managerial implications and guidelines for including patent experts in the front end of the innovation process. ABOUT THE AUTHOR: Jackie Hutter, MS, JD is one of the pioneering ranks of Intellectual Property (IP) Strategists. She is Chief IP Strategist of The Hutter Group LLC, a consultancy providing IP-related business and investment counseling to innovation-driven organizations of all sizes that seek to maximize their greatest asset--intangible assets. She has over 15 years experience counseling all types and sizes of organizations in all facets of IP creation, protection and enforcement. Jackie was named one of the 250 top IP Strategists in the world by Intellectual Asset Management magazine for 2009 and 2010. Jackie was named a SuperLawyer® in IP in Georgia in 2004, and she is a frequent speaker on IP strategy. Jackie was previously Senior Counsel at a multi-national corporation and a partner at a well-known Atlanta, GA law firm.

1. The number one online magazine for innovation management practioners
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ISBN: 978-91-86829-05-6
Feature Article # 3-2010
Improving Innovation
ROI with Early Stage
Patent Expertise
Jackie Hutter, MS, JD
Chief IP Strategist of The Hutter Group LLC
by

2. Improving Innovation ROI with Early Stage Patent Expertise
4 Feature article #3-2010 brought to you by InnovationManagement, ©Ymer&Partners AB All rights reserved. To order please visit www.imstore.se.
VALUE PROPOSITION
By including patents as a component of information
gathering at the earliest stages, a company can
better ensure that a new product or technology
will provide the durable competitive advantage
needed to validate innovation investment. That is,
for one or more innovation pathways, patent data
can provide insights into whether the company
is likely to obtain patent rights of a broad enough
scope to prevent competitors from legally playing
in the same market space. Incorporation of patent
information at the early stages also provides a signal
of whether one or more innovation pathways are
likely to lead to costs and business uncertainties
resulting from patent litigation, both of which will
make it difficult or impossible to fully capitalize on
innovation investment. Put simply, incorporation of
patent insights into go-forward financial models can
improve the probability that a company will achieve
the expected ROI on its innovation.
PATENTS AS SOURCES OF
INNOVATION DATA
A primary way to introduce patents into the front
end of innovation processes is to utilize patent
information, also called “patent landscaping”
or “patent analytics,” as a source of data used in
decision-making. As shown in Figure 1, the number
of U.S. patent filings has increased dramatically in
recent years and, as a result, a wealth of competitive
FIGURE 1: U.S. patent filings from 1965-2008. Source: U.S. Patent Office.
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3. Improving Innovation ROI with Early Stage Patent Expertise
7Feature article #3-2010 brought to you by InnovationManagement, ©Ymer&Partners AB All rights reserved. To order please visit www.imstore.se.
Guidelines for Including Patent Experts
in Front End of Innovation Processes
Business
leaders must
make
ultimate call
regarding
innovation
pathways
Align patent
expert
incentives
with
innovation,
not just risk
mitigation
and cost
control
Realize that
not all
lawyers will
operate well
in the
innovation
space
Consider
introducing
patent experts
into formal
business
reporting
structure
Recognize
that costs
may initially
increase when
addressing
patent
matters early
in innovation
process
FIGURE 3: Steps for successfully including patents in corporate innovation processes.
With regard to successfully integrating corporate
patent experts into the innovation realm, Figure 3
provides further guidance to the reader. Specifically,
it is critical to recognize that even though the patent
expert functions as a member of the corporate
innovation team, the business team should
nonetheless retain decision rights as to whether to
proceed in a particular innovation pathway.
If decisions do not reside with the business team, it is
likely that the inherently conservative nature of many
patent counsel could reduce the overall effectiveness
of the innovation processes. The corporate patent
expert should also be rewarded for providing advice
that may amount to no more than an “educated
guess,” as opposed to the “dotting the I’s and
crossing the t’s” type of advice that most legally
trained people are more comfortable in providing.
Further, those who make the organizational
management calls should recognize that not all
patent experts will function comfortably and
effectively in the ambiguity of innovation processes,
and that the company may need to go outside to find
the appropriate patent expert to “play well” with
their innovation team. Some companies have seen
success when they introduce their corporate patent
counsel into the formal reporting structure of the
business, as opposed to having lawyers reporting
into—and being incentivized by—corporate legal
management.
Lastly, the ambiguity of early stage innovation
processes typically gives rise to less discrete questions
and, as such, more complex analysis which, in turn,
will likely result in higher costs than the company is
used to paying for patent-related advice. Corporate
decision-makers must therefore be willing to absorb
this cost increase in exchange for the opportunity
to generate markedly improved ROI on their
innovation investment.
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