IP and the network business model

Another paradox surfaced by the emerging business networked models is that of ownership of IP.

In the old days, just a few years ago, ownership of IP was top of mind in many if not most development situations, but then along came digital collaboration.

Linux is now the dominant operating system installed on large servers, a loose collaboration of nerds has significantly outperformed Microsoft, one of the smartest companies of all time, with access to the most and best resources, and a dominant starting position. How can this be?

Nobody owns the Linux IP, it is a common license,   

Toyota for years has encouraged, perhaps demanded, innovation from its tier 1 suppliers, often using non quantified descriptions of outcome  as a substitute for detailed specifications, and Boeing, in the design and construction of the 787, set out to “co-innovate” with its suppliers, as they recognised the development task was simply too complicated to do alone.  Despite huge problems, the exercise has yielded technology advances that Boeing believes will give them a big advantage for many years.

The key in building a network business model is the recognition that IP is no longer the end game, simply a means to an end. Businesses are now prepared to own some, share it, give it away, and have others generate it,  just to ensure that the benefit from the knowledge flows through to the product.

I recently completed a business plan for a client which called for a high degree of collaboration with other complementary institutions, all of whom have at their core, a reverence for IP.  In considering the drivers of success, and writing a plan to harness them, ownership of IP was always going to be a big stumbling block, it turned out to be a terminal one. However, the plan did get a few people thinking, so perhaps down the track a bit the benefits of a networked model may be seen to outweigh the C20 preoccupation with IP ownership, after all, it is how the IP is leveraged, not who owns it, that counts.  

About strategyaudit

StrategyAudit is a boutique strategy and marketing consultancy concentrating on the challenges of the medium sized manufacturing businesses that make up the backbone of our economy. The particular focus is on their strategic and marketing development. as well as the business and operational efficiency improvements necessary for day to day commercial survival. We not only give advice, we go down "into the weeds" to ensure and enable implementation.
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