Protecting your Intellectual Property

Though intellectual property should be respected as much as physical types of property, it often isn’t. How do you protect something that is the core of your business and makes it unique?

Intellectual property represents the product of your mind or intellect. IP can be an invention, trade mark, original design, or the practical application of a good idea. These rights are very valuable assets that can distinguish your business from your competition, making your products and services unique and attractive to your customers. Registered IP takes on many forms: patents for inventions, trade marks for logos and brands, designs for the way a product looks and plant breeder’s rights for new plant varieties.

Aside from patents, trade marks and designs there are a number of other IP rights that exist without the need for formal registration, such as copyright and confidential information. The law of passing off and the Trade Practices Act 1974 also offer businesses some protection against exploitation from competitors.

Nearly all businesses own some form of IP that is important to their operations and ongoing success. IP can be simple information such as a customer list that should be kept confidential, or it could be a patented product arising from significant research and development undertaken by employees who are bound by confidentiality obligations. Other examples include an unforeseen and fortuitous by-product resulting from a core business activity.

The sheer diversity of types of IP, and circumstances surrounding its creation, often makes it impossible for a company to be aware of the full extent of its IP. An IP audit can help remedy this.

Conducting a simple IP audit can help you to identify IP assets you didn’t know your company owned. You may also realise that your IP assets are not adequately protected. For example, have you registered your business name as a trade mark? If not, it is something worth thinking about.

IP Audit

Be systematic in identifying your IP and don’t be too conservative about the time and resources you allocate to doing the job thoroughly. Ask yourself questions about IP assets that are key to your competitive advantage and which should in turn be protected. Some questions you should be asking include:

* Do you have any registered trade marks, designs or patents?

* If so, when are they due for renewal?

* Do you own the IP you are using? Can you prove it? Do you have the contracts and other proof that a court of law would require?

* What are the processes or knowledge critical to your business success? Are they unique to your business? If so, have you protected them?

* Do you have signed agreements with key personnel, contractors, consultants or other external suppliers which assign any IP they develop when working for you, to your business?

* Do you have valuable customer lists or databases?

* When completed, store in a safe place and renew regularly.

Commercialising IP

Once you have identified and protected your IP you can explore how to make your IP turn to profits. Commercialising IP is the process you undertake to get your innovations, whether they are in the form of products or services, to the marketplace. Before you decide on your commercialisation strategy, you will need to explore all options fully. Assess these in light of your personal and professional circumstances to ensure you follow the path that enables you to maximise your potential profit, with the least difficulty. Your commercialisation strategy determines how you can take the best advantage of the exclusive rights associated with your IP.

The two most common ways of commercialising your IP are to undertake all the steps in-house, or to work with a partner. When you commercialise in-house you develop your product to a market-ready state without any external assistance. Going it alone means that you take on all the work and risk associated with launching a new product. It also means that if you are successful, you reap all the benefits.

Commercialising in-house might involve having or building your own manufacturing facilities; manufacturing the product using your own facilities, staff and resources; marketing and promoting the product using your own staff and resources; and, arranging all distribution and sales channels.

Commercialising with a partner means you involve one or more parties to either undertake or assist with some or all of the above steps.

If you don’t have the capability to personally and exclusively manufacture, market or sell your IP product, and you don’t wish to partner with another company, you may be able to outsource one or more of the required tasks.

There is no such thing as a ‘best’ strategy to commercialise your product. It very much depends on your ‘business profile’, the attributes of the IP and your desired outcomes. How you decide to commercialise depends on your particular IP circumstances, existing core business capabilities, understanding of the market, and ability to generate finance.

Once you have decided the best approach for the Australian market, the potential for international expansion might be a consideration. IP Australia can assist with information about how to help your business take off overseas.