Intellectual-property scepticism

Bewailing the shortcomings of small businesses is a popular sport. Everyone’s at it – from government ministers and other politicians to providers of business services (including IP services), and from management scientists to journalists. Every imaginable failing attracts their opprobrium. But there's one kind that gets more than its fair share. I call it the lack-of-awareness-of-X. In each case, of course, X stands for some supposedly critical ingredient of business success. It might be information technology, marketing, the market for their products, finance, law, their carbon footprint… In fact, you name it; lots of SMEs don't get it. Apparently.

Intellectual property is no exception. It’s natural enough, I suppose. Accepted wisdom says high-labour-cost economies will depend more and more on intellectual property. So businesses need to get their heads around it. It stands to reason, doesn't it?

I don't doubt that many are the SMEs that could benefit from understanding IP better. I do wonder, though, if there wouldn’t be merit in turning the tables as well. In other words, wouldn't things be even better if those who urge SMEs to get to grips with IP themselves got to grips with the reasons why SMEs don't behave towards IP as they, the critics of SMEs, suppose they should?

The problem with continually charging SMEs with a lack of awareness of IP is that it sweeps these reasons under the carpet and makes a single reason stand in place of them all – namely plain ignorance. SMEs don't play the IP game as they should, it suggests, because they know nothing – or virtually nothing – about intellectual property.

Cut to a presentation at a recent seminar put on by a trade association we work with. The owner of a start-up was talking us through the history of the innovation he'd set up his company to develop. This was a man who'd worked for years as a sales person in the marketplace where he's soon going to be selling this, his first product. This guy knew his onions.

Following the usual advice, he'd patented his invention and the IP had helped him finance product development. But going through the process gave him pause for thought. Now he's decided he probably won't patent the next inventions he has in the pipeline. Why? Well, the price of obtaining a patent was high on his list of reasons. His business is also protected by requirements that medical inventions like his have to meet before they can be legally placed on the market. Approval takes time – time an imitator probably can't afford.

Top of the list, though, was one reason that doesn't often feature in those introductory IP-for-dummies lectures you come across at business events. This inventor reckons a patent isn't very valuable to him unless he has the capacity to sue an infringer. Finance for start-ups being as hard to come by as it is, he knows he wouldn't be able to raise the funds to pay for court action against a large corporation that chose to infringe.

But the specific reasons are not important to what I'm suggesting here. The important thing is that ignorance had nothing to do with this company's decision to think twice before applying for patents in future.

Many other companies are in a similar position; they have some knowledge of IP but are not entirely sold on its merits, and with good reason. Who knows how widespread those in the middle ground are, between the completely ignorant and the well-informed but healthily sceptical? The answer, I suspect, is the vast majority. I suggest we won't find out – and so may not be able to raise industry's IP game by much – until we break free of the lack-of-awareness fixation. Improving IP exploitation by SMEs needs to be a two-way thing. Yes, many SMEs stand to gain from a richer understanding of IP. But getting IP experts to understand how IP is regarded and can practically be exploited by sceptical SMEs is no less urgent a task.