The video below was made to focus on R&D and innovation management, but I think it applies to IP strategy in the larger context of a company’s activities as well. Successful R&D needs a sound business model or exploitation scenario at the end of its pipeline. When companies with a candidate technology that has a good chance at success fail, it is usually because the companies either don’t have a viable way to create a revenue stream for the technology innovation, lack the complementary assets of their competitors, or have not secured the monetization gate via differentiated IP and scalable standards.
Traditional R&D didn’t die, but the processes that plugged it (or more accurately didn’t plug it) into the enterprise have certainly bitten the dust. But, there is a pipeline for the innovation management process as well. Open innovation, strategic partnering, and rapid prototyping at their essence are nothing more than recontextualized management processes. If there isn’t a velvet rope at the entrance to admission, your company will be footing the bill. With the cost and pace of technological change and deployment, such a burn rate (even with a sizable runway) isn’t going to allow you the luxury of too many free matinees.
So, what is your return on innovation? A vague question without any hope of a clear, succinct answer – it would be better to ask what can be done to maximize such an “ROI” given your company’s resources through its IP strategy. The formula is simple, yet elusive. Innovation needs an appropriate culture to flourish, but also a formal mechanism to reap its bounty, without stifling the flow of ideas. Technology innovation needs to be guided with strong intent, and yet be supple enough to allow fortuitous serendipity to create leapfrog opportunities. Such delicate balancing acts can create remarkable boomerang effects to catapult your ROI, but can also spin out of control, consuming valuable resources along the way.
