Marshall Phelps was the leader of the Intellectual Asset(IA) team that led to $2 billion in one year. In addition to the ear catching sound of two followed by a billion, the achievement was important because it gave the business leaders of the day an idea about what effective IA management could accomplish in dollars and cents. In his and David Kline's book, "Burning the Ships", Phelps takes the paradigm of effectively managing IA to the next level and explains how IA can be used to cement deals, earn industry respect, and the like. In Burning, Marshall talks about the ideas and influences that went into Microsoft's trend setting deal with Toshiba, the recovery from antitrust suits, dropping non-assertion of patents clauses from all of their supplier agreements, and the push for Microsoft to become more open. I think the most interesting part of the book has to do with his philosophies and different management practices though. As far as usefulness, It's not; At least not to me. This book reminded me of "The world is flat" by Thomas Friedman, Where any 20 something who has been involved in any kind of technology field will immediately recognize the tenants of the book as forgone conclusions.
One of the first things that Mr. Phelps talked about was how you have to collaborate with other companies to make your customers happy. His insight was rare in the business environment where customer satisfaction was seen in a quarterly dollar and cents light. Mr. Phelps was able to get outside the corporate bubble and make the case that making Microsoft products play nice with other products would increase market share in the long run and make other industry segments more likely to use Microsoft's products. For instance, server side software is a classic example of a mish mash between Microsoft and Linux suppliers for software. Mr. Phelps, while at Microsoft, made it a priority to work out a deal with one of the leading Linux service providers, Novell. He went on to explain the benefits of this as being both customer satisfaction and better standing in the industry. He also strongly hinted that a Microsoft-Red Hat deal was in the works, but confidentiality agreements kept him from divulging more information.
Mr. Phelps saw the litigious nature of current IA planning as a drawback. He made his point with a quote from Steve Ballmer, Microsoft CEO, "The company has made it a priority to do all we can to end these legal issues and to do so in a way that increases collaboration with other companies." Mr. Phelps also talked about how he started to internalize a lot of services that they used to farm out to external firms, like patent drafting. He said that by internalizing things like patent drafting it saved them money, raised patent quality, and also gave them more flexibility with their filing procedures. He instituted "forward invention sessions" in the company where patent researchers would prepare reports for technology heads telling them what sort of technologies were in the market and available for use. This got the Tech leads thinking about different ways to collaborate with other companies and different ways to leverage their own technologies in the market. Mr. Phelps said of his collaborations with entrepreneurs, "the biggest benefits is that we got a lot of entrepreneurs and companies looking at the fact that Microsoft can be a good partner, a good collaborator. that's key."
The point of IA acquisitions is not to "produce a profit -- at least not directly, or in the short-term -- but rather to acquire needed technologies, build partnerships, achieve strategic objectives, and/or resolve disputes." This is a direct quote that I think hits the nail on the head. Companies have to play well with others but most importantly a company has to have a goal in mind; like Google's "organize the world's information". When IA is 80% of your assets, as it is with lots of technology companies, then you have to effectively leverage that asset to meet your business goals, or you are not doing your job. He used that point to make a second point: if you ran a concrete factory and you didn't know where 80% of your assets were you would be fired. Somehow, though, it is almost common place for a technology manager not to know or understand where his IA is. I think this was the most important part of the book, saying that companies not only need to look at IA as something more than just a legal issue, but also an asset; as the name says. By collaborating with other companies new applications and know how are inherently brought in and it make the idea worth more. If the idea has been protected, patent, copyright, trademark etc., then the idea brings more value to the company.
So, like I said in the beginning the ideas and procedures outlined in this book are not really ground breaking to me, but it articulates the sort of ethos an IA manager should bring to his/her work. Know what IA you have, use your IA to build value. To give credit where credit is due, Mr. Phelps figured this out when his equally tenured colleagues were still bumbling about in the old-world IA mindset.
One of the first things that Mr. Phelps talked about was how you have to collaborate with other companies to make your customers happy. His insight was rare in the business environment where customer satisfaction was seen in a quarterly dollar and cents light. Mr. Phelps was able to get outside the corporate bubble and make the case that making Microsoft products play nice with other products would increase market share in the long run and make other industry segments more likely to use Microsoft's products. For instance, server side software is a classic example of a mish mash between Microsoft and Linux suppliers for software. Mr. Phelps, while at Microsoft, made it a priority to work out a deal with one of the leading Linux service providers, Novell. He went on to explain the benefits of this as being both customer satisfaction and better standing in the industry. He also strongly hinted that a Microsoft-Red Hat deal was in the works, but confidentiality agreements kept him from divulging more information.
Mr. Phelps saw the litigious nature of current IA planning as a drawback. He made his point with a quote from Steve Ballmer, Microsoft CEO, "The company has made it a priority to do all we can to end these legal issues and to do so in a way that increases collaboration with other companies." Mr. Phelps also talked about how he started to internalize a lot of services that they used to farm out to external firms, like patent drafting. He said that by internalizing things like patent drafting it saved them money, raised patent quality, and also gave them more flexibility with their filing procedures. He instituted "forward invention sessions" in the company where patent researchers would prepare reports for technology heads telling them what sort of technologies were in the market and available for use. This got the Tech leads thinking about different ways to collaborate with other companies and different ways to leverage their own technologies in the market. Mr. Phelps said of his collaborations with entrepreneurs, "the biggest benefits is that we got a lot of entrepreneurs and companies looking at the fact that Microsoft can be a good partner, a good collaborator. that's key."
The point of IA acquisitions is not to "produce a profit -- at least not directly, or in the short-term -- but rather to acquire needed technologies, build partnerships, achieve strategic objectives, and/or resolve disputes." This is a direct quote that I think hits the nail on the head. Companies have to play well with others but most importantly a company has to have a goal in mind; like Google's "organize the world's information". When IA is 80% of your assets, as it is with lots of technology companies, then you have to effectively leverage that asset to meet your business goals, or you are not doing your job. He used that point to make a second point: if you ran a concrete factory and you didn't know where 80% of your assets were you would be fired. Somehow, though, it is almost common place for a technology manager not to know or understand where his IA is. I think this was the most important part of the book, saying that companies not only need to look at IA as something more than just a legal issue, but also an asset; as the name says. By collaborating with other companies new applications and know how are inherently brought in and it make the idea worth more. If the idea has been protected, patent, copyright, trademark etc., then the idea brings more value to the company.
So, like I said in the beginning the ideas and procedures outlined in this book are not really ground breaking to me, but it articulates the sort of ethos an IA manager should bring to his/her work. Know what IA you have, use your IA to build value. To give credit where credit is due, Mr. Phelps figured this out when his equally tenured colleagues were still bumbling about in the old-world IA mindset.
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