According to MIT Sloan Management Review, a company’s IP strategy is most likely to be successful when its executives are highly involved in the patent process. Importantly, this held true regardless of what industry the company operated in.
We’ve previously written about how tech startups can successfully launch their own patent portfolios, as well as common mistakes to avoid during the patent process. But we haven’t yet discussed the role that key decision-makers play in the patent process.
So in this blog post, we’ll be examining how top executives have led their businesses to develop successful patent strategies.
Note that we’re talking about tech executives who are outside the legal department and responsible for the patent portfolio. In many companies, this will be the CEO. But in some companies, it might also include a CTO (chief technology officer), a chief intellectual property officer (CIPO), or someone else.
Should executives be involved in the patent process?
The short answer: Yes.
My own anecdotal experience is consistent with the MIT Sloan Management Review’s conclusion — and I’ve spent more than 10 years working with tech executives of all experience levels to manage their patent portfolios.
In fact, my first “client” that I managed independently was a tech conglomerate that consisted of a parent company and three subsidiaries, and my main contacts were the CEOs of each entity. I learned a lot from them!
Since then, I’ve drafted patent applications for multiple inventors who were CEOs of Fortune 100 tech companies, and helped many more early-stage tech executives develop patent strategies.
Based on these experiences, I’ve noticed that effective executives tend to have several common themes in their approach to patent portfolio strategy and management.
How top tech executives approach IP management
Here are five common behaviors of tech executives I’ve worked with who have successfully leveraged the patent system:
1. They’re decisive
Effective C-level executives will get the input, data, and advice they need, and then make a decision on what next steps to pursue.
They don’t waste their limited time and money keeping all of their options open, or waiting for the perfect moment; instead, they’re ready to respond to the market’s rapidly changing needs.
The bottom line? Don’t be afraid to make a wrong decision. Yes, you might end up making a mistake — but educate yourself to maximize your chances of making the right decision, and seize the opportunity to learn from the ones that turned out to be wrong.
2. They’re ambitious
Short-term gains don’t always drive long-term success.
To thrive in turbulent market environments, where competition and risk levels are high, you need a growth-driven, long-term vision for your company.
So take an expansive approach toward protecting your intellectual property. Of course, leverage the patent system to protect your own inventions. But also think about how to protect your company against competitors who are doing the same thing. There’s a reason people call them “patent wars” — patent litigation can be highly contentious and adversarial, and so it’s important to prepare your company for any eventuality.
3. They’re knowledgeable
As mentioned earlier, the best tech executives I’ve worked with have been directly involved in the patent process at some level.
To be sure, any good executive will delegate appropriately, and you do have to trust your team (more on that soon).
But the executive should play an active role in top-level discussions and decisions. Ultimately, you’re responsible for the company’s overall business strategy — and your patent portfolio is a critical component of that strategy.
To that end, many C-level executives are often found:
- On the company’s patent committee
- Innovating and therefore involved as an inventor
- Aware of patent strategies and major decisions (foreign filing options, etc.)
4. They’re ready to invest
So if you’re going to pursue patent protection, be willing to spend the money required to get it done right. This is especially critical during the drafting stage: To reduce exposure to future litigation or IPR challenges, your claims need to be robust enough to hold up under close scrutiny.
What does that mean for C-level executives?
- Don’t arbitrarily cap your spending. For example, don’t decide that you’re going to spend a certain (arbitrary) amount per patent application. Of course, you should have a budget — but also have some flexibility.
- Don’t settle for the lowest bidder. As with most professional service industries, you often get what you pay for. (Not sure how to assess your options? We’ve compiled a list of 22 questions to ask before hiring a patent professional.)
5. They hire trustworthy teams
As discussed above, you need to be able to trust both your internal team and your outside legal counsel — which is why it’s important to make the right hiring decisions.
When assembling your internal team, you’ll want to find someone inside your organization who can act as liaison to your outside counsel. This person needs to be highly organized and a good communicator (and preferably, have some experience with patents).
When hiring outside counsel, don’t let the potential for high upfront costs deter you! In the long run, choosing the best-fit attorney will actually save you money, because a good patent attorney will help you draft high quality claims — and tell you when not to file a patent application.
In addition, if your business is fundraising or looking to be acquired, your outside patent counsel will be interviewed as part of the due diligence process. So it pays to hire someone who understands your work and can communicate it well.
Are you documenting your employees’ inventions?
Last but certainly not least, it’s vital for you to educate employees about their duty to disclose their inventions to the company, and also to support their contributions to the company.
The best way to do this is by documenting your employees’ inventions in an invention disclosure record (IDR). This process allows you to track important dates, establish an invention’s scope, and avoid unexpected prior art.
Don’t know how to write one? Our IDR template is simple, fast, and free to use — download it now.