Patent Data as an Offensive and Defensive Strategy
Companies that fully integrate the management of their patent portfolio into their business strategy are often more successful and run more effective operations. Patent attorney Paul Hylarides believes that patent managers should be given a more prominent role in the boardroom. In recent decades, he has seen the importance of patent data increase dramatically. Globalization and digitization have made patent knowledge the way to determine a strategy, says Paul Hylarides, partner at the Arnold & Siedsma trademark and patent office.
The company has branches in the Netherlands, Germany, Belgium and Switzerland and provides legal advice to international multinationals in Europe. Arnold & Siedsma also assists European businesses in patent cases in Asia and the US. Hylarides specializes in computer engineering, medical technology and mechanical engineering.
As a patent attorney, Hylarides regularly has the opportunity to take a look behind the scenes at companies where intellectual property is of paramount importance. Major corporations often have their affairs in order.
These kinds of tech companies monitor competitors’ requests “so they can look into each other’s future,” he says. But also to pinpoint in which direction innovation as a whole is moving. Moreover, they use patent portfolios to protect themselves and strategically outmaneuver the competition.
Simple, cheap and fast
Yet many companies still underestimate the value of patent data. Which is a pity, says Hylarides. The amazing technological progress that has been made in recent years in terms of making patent data accessible and transparent offers enormous opportunities. “Analysis used to be complex, expensive and time-consuming,” says Hylarides. “When I started, I had to wade through CDs containing thousands of documents. Now, thanks to AI, algorithms and various other tools, it’s simple, cheap and fast.”
“How to use patents and why you need insight into the competitor’s portfolio is what’s called strategic patenting,” says Hylarides. “Management has to consider the opportunities, the threats and the direction you want to move in. And then you have to ask yourself: which patent portfolio is the ideal match? Once you’ve determined that, you can look at what’s possible and determine whether, as a company, you have sufficient knowledge to achieve that goal.”
He still doesn’t come across this sequence – determining the strategy and then tailoring your patents accordingly – often enough in practice. Only well-run companies do it. “That’s a missed opportunity,” he says. “Putting together an ideal portfolio is perfectly feasible. You can narrow your search to a defined area, identify what’s missing, and then buy it.”
Once you’ve put together this kind of portfolio, you can start doing business, says Hylarides. You can stay ahead of the competition. You can accelerate innovation. You can mitigate risks. You enter a market knowing that your competitor has a patent, but you counter it with a patent that causes problems for the same competitor. So strategically speaking you can operate defensively and grab each other by the throat. This is only possible if you know exactly which patents your competitor holds. It’s all connected.”
Hylarides wants to dispel the notion that the IP race between Europe, Asia and the US has already run its course to the detriment of Europe. While it may be true that the US and China are strong in terms of technology – think of the demise of the European mobile phone industry these past fifteen years – Europe has no trouble keeping up in other areas.
Pharmaceuticals, agri-food and chip machines are examples of areas in which Europe excels. “China files a huge number of patent applications, but the quality is often poor.” However, he also points out that China is wasting no time assuming its place on the world stage. “That shouldn’t be taken lightly. Forewarned is forearmed.”
Change of mindset
That’s why leaders of industry have to change their mindset. Inventors and data analysts have to be moved from the basement and into the boardroom. The importance of IP needs attention at a high level. “In the US, inventors work with management. Europe is more traditional in that respect, which is a pity. Things are beginning to shift here too though. Young people are keen to do business: they go straight from university to launching a start-up. They don’t necessarily want to work for a major corporation anymore. That’s no longer their top priority.”
Contributing to success
He acknowledges that many factors can influence management decisions. But companies that value innovation should give obtaining and managing patents a much more prominent place in their business operations. “If IP managers feel they’re contributing to the company’s success, then that will boost their self-confidence. It will lift them. It would be great if innovative inventions made an impact at the management level more often.”
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