Why should you care if your company is aggressively filing patents?

by Mike Rainone

"War is the best thing that could happen to you as an innovator or design engineer."

Rejoice! The war is here.

No, not Iraq or Afghanistan or even Georgia. I mean the war being waged in Washington at the USPTO between heavyweight, middleweight and welterweight companies from around the world. It is a war over patents; an escalating war that is being waged with examiners, in courts, in the R&D labs, and in NPD and product innovation centers on the world. It’s a war that, happily enough, stands to benefit the design engineers, the innovators, and the R&D scientists of whichever company wins, because if you think about it - we win in any case!

Obviously, this month I want to talk about patent strategies and what patents means to design engineers and other innovation professionals. This isn’t a conversation about how to file, what is patentable, or provisional vs. full disclosures. Rather, it’s a look at the current corporate patent war, my perception of your role as a grunt on the front line, and why I think war is the best thing that could happen to you as an innovator, or design engineer.

First, why the war? Why the explosion of filings? Why the huge emphasis on IP (Intellectual Property) even in market segments which were not traditionally fixated on IP capital? The answer is money. An increasing number of corporations worldwide are using patents as a competitive weapon. If they’re not, they should and soon will be.

An active and aggressive IP strategy can make the company money, from protecting existing market share by blocking the competition, to laying the ground work for products far into the future, to providing intellectual capital to sell. This has been going on for a long time in selected markets, like medical and oil. Folks in those businesses take this war for granted; it is a fact of life.

Company ‘A’, for example, has at least six patent attorneys on staff who do nothing but coordinate outside contractors for writing and filing. Company ‘D’ — about the same size — has no patent attorneys inside, files minimally, and is constantly surprised, not in a good way, by what their competition is doing.

The differences between the two are striking. In the patent-savvy firm, the design engineers actively search the archive before starting on the innovation process. They look five to ten years out, have active R&D functions and patent even before the innovation is financially, and often completely technically, possible.

The non-savvy firm is in innovation disarray. The competition is constantly besting them, beating them to market with innovations, and blocking channels of development. Internally, the engineering staff is demoralized. The “innovations” produced are focused on packaging and surface treatments, not technical innovation, and the company survives on really old, reliable lines … but momentum will not carry them forever.

So, which company do you work for? And why should you care if your company is aggressively filing patents? It’s simple. When corporate folks begin to understand that there is value in the patent itself, either from protection or licensing, they will, in spite of themselves, connect the patent’s value to the effort. And, when they realize that patents are a viable weapon in the product development war, then engineering, R&D and innovation will finally have a direct connection between the money that the “beanies” hate spending on you and the bottom line of the company.

Conversely, and I realize that this is an even greater stretch for the concrete thinkers, they may get the notion that R&D has value on the battlefield, because if they don’t put money into R&D, the competition will eventually figure it out and kick their rear ends. Again, we win. About now, I hope you’re wondering what you can do to help. I’m glad you asked.

First, realize that patents often form the backbone of what can and cannot be done. They help formulate product strategy and give engineers direction for new development.

Second, you should be routinely following patent filings when they are published as applications a year after the initial filing. Reviewing patent archives can help you figure out what path not to go down, and let you see the variety of ways something has been done in the past.

Third, remember that even companies on the front line of the patent wars often forget their past. Look into your own company’s patent archives. I can’t tell you the number of times, after spending a great deal of a client’s money, I’ve received this call: “You know what, I think we may have done some work in this area.” The idea of keeping track of a company’s IP is just beginning to take hold. Make those the first drawers you get into.

Finally, even if a concept isn’t financially or even technically feasible today does not mean you should refrain from filing. You must assume that what is not technically possible today could be in a few years. And what costs too much today will drop in price. You also better assume that your competition is working on it.

Here’s a cautionary tale to illustrate my point. While combing through competitor filings on behalf of a client, I discovered the application of a cool new technology that a competitor had applied to their product line. I called a friend who had been with the company for 20 years, a brilliant design engineer who has been threatened with layoffs numerous times in his career:

“Did you see this cool patent that your competition filed on the use of ‘X’ on your ‘Y’?” I asked.
“What!? I worked on that eight years ago!” he replied.
“And, did you file a patent?” I prompted.
“Heck no,” he said. “It was too expensive to use and didn’t work very well. Management wouldn’t pay for the patent!”
“Well, it works now and it has dropped in price by an order of magnitude.” I said. “You’re screwed.”
After a long silence he said “Again.”

And to think, management wants to cut his job ...

Mike Rainone is co-founder of PCDworks, a technology development firm specializing in breakthrough product innovation. You can contact him via mrain1@pcdworks.com or by visiting www.pcdworks.com.