Top tips on portfolio management
March 2, 2021
With more than 200 years of experience in IP management between our senior leaders, we’re often asked for our thoughts on managing a patent portfolio. Here are some of our collected thoughts:
- The five questions any portfolio manager should be able to answer
A patent portfolio should be managed in broadly the same way as any other portfolio of assets, such as real estate. So, you need to decide:
- How much to invest
- How to allocate investment between different assets and different geographies
- How to generate the appropriate assets (whether through your own R&D or external acquisitions)
- How to get a return from your investment (whether in licensing revenue or in better returns for your own products or services)
- When to stop investment into certain assets in the portfolio
- Set your goal and stick to it
Whether it is set up as a defensive or monetization portfolio, the same guiding principles remain, you need to ensure that each patent or family is achieving the overall goals that you have set.
- Build your infrastructure
To manage IP assets effectively you need to have the mechanics in place to work effectively. In practice, this mean identifying how to best work with patent offices and agencies, how to resource internal operations, what IT tools to use, how to best organize your activities and responsibilities, and what competencies are needed. You also need portfolio indicators which enable you to measure the how and where.
- Get the application phase right
It’s much easier to adjust patent scope during the application process. This the critical time to get the patent right and ensure it is not too narrow or too broad. As you develop the patent through the process you need to always focus on infringement, regardless of whether the patent is standard essential or non-standard essential. Even when possible, it’s much more difficult to change a patent after approval so spend time and resources getting it right before hand.
Not all patents or patent families have the same value. The mistake some companies with large portfolios make is to treat all their patents equally, spending the same costs and resources in the process. Some patents will have high value, some will be of less value but worth maintaining, and others will have little or no value. Spending should reflect the benefit the patents represent to the business. To use a real estate metaphor – some homes you buy to develop further, some homes are fine as they stand and are there to be lived in, and some need to be sold (or condemned).
- Beware of silos
Often in large companies or with large portfolios, there may be a disconnect between teams responsible for portfolio management and for realizing the portfolio benefits (such as product creation, patent monetization, etc.) as different managers oversee different specialisms. It’s really important is for each team to understand the impact that the decisions they make could have on other parts of the business.
- AI: proceed with caution
Artificial Intelligence can be useful for mining massive portfolios and prioritizing work. AI can filter data and provide a level of analysis, which can help guide human analysis. But it also has limitations. Many similar patents use differing terminology. AI has difficulty picking up on nuances, or contexts, and will exclude some patents which meet the right criteria and identify others which don’t. In short, it won’t replace human analysis, but can be a helpful tool for prioritizing where to use human analysis.
- Play the long game
Portfolios need to be managed pro-actively. Most IP assets generate value only after 7-10 years and assets are valuable only if somebody uses them (whether by you in your own products or by somebody else in theirs). Some assets have current value, some assets may have prospective value, and others may need active steps to promote their use, such as in standardization.