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Rimma Pugatsch Shendelzon
Rimma Pugatsch Shendelzon
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Rimma is the Chair of the Israel Patent Attorneys Association (IPAA), the Director of Intellectual Property at Landa Digital Printing and IP consultant. She is also a founder of the Patent Attorneys IP-Managers forum and a board member of The Forum of In-House IP Managers and Counsels. She is a...

Deloitte IP 360 Survey 2023: Insights and Challenges for IP Managers

16 Jan, 2024

Even though we are in an era of shortcuts where AI tools read, analyze, and write for us, I decided to dedicate a few hours to read all 60 pages of Deloitte’s 2023 IP-360 Survey (which is certainly worth reading!). The survey covers various industries and offers a comprehensive view of IP management in companies.

I present the following summary, along with a number of conclusions and insights, from my perspective as Director of IP in a company, focusing mainly on the key challenges facing IP teams and managers, as identified in the survey.

Team Size and Structure: The survey indicates that most IP teams are relatively small, with 54% of them having less than ten people. In most Israeli companies, the teams are even smaller, usually 1-2 people at most, and this number is often not proportional to the number of employees involved in development, innovation, and other groups that touch different IP areas. This can certainly limit the maneuvering space of IP managers.

Reporting and Communication: According to the survey, most IP teams report to the Legal Councel, positioning IP primarily as a legal function and sometimes creating a barrier and even an obstacle in the interaction of an IP manager with other groups in the company.

IP Portfolio: One of the common challenges in managing an IP portfolio is balancing the size of the portfolio with the team’s ability to manage it effectively. According to the survey, patents and trademarks are seen as critical value drivers, but there is recognition that know-how, innovation, and inventions provide significant competitive advantage. In this context, the contrast between the management skills of registered rights such as patents and trademarks, which are expensive to maintain and well-regulated, versus the lack of methodologies for managing equally valuable rights like knowledge, trade secrets, and data, is interesting.

Communication and Collaboration with Other Departments: The survey clearly shows the gap in communication between IP teams and other departments. While there is a natural (and obvious) connection with R&D and Product Development departments, the connection with marketing teams, business development, finance, taxes, etc., is lacking.

IP Strategy: The survey reveals that while 84% of companies have a well-documented IP strategy, indicating a full consensus on its importance, the survey also shows gaps between the desired strategy and reality:

a. Only 40% of companies report involvement in IP strategies by C-suite, which is inconsistent with the fact that a significant part of a company’s value lies in its IP. b. Portfolio review and optimization are supposed to systematically align IP strategies with business objectives. However, according to the survey, 35% of respondents lack structured processes for this.
c. The use of external tools for analytical purposes is relatively common, but the use of external consultants for strategic planning is significantly less common, which may hint at a certain disconnect in viewing IP as a significant part of a company’s business strategy.
d. Continuous monitoring and tracking of competitor activities for IP infringement identification is known to be vital, yet many companies do not actively follow potential infringements, potentially missing rights enforcement or licensing opportunities.
e. According to the survey, only 44% of participants manage and register open source code systematically, despite the clear and significant importance of a structured open source policy, especially in the context of mergers and acquisitions.

Indeed, it seems that most companies have an IP strategy. However, the likelihood of it being fully realized is not particularly high due to limited involvement of senior management and additional gaps detailed above.

One of the significant lessons from the survey is the importance of expanding the involvement and “visibility” of the IP strategy beyond the IP department. Additionally, expanding the strategy to include other aspects, such as an open source policy, for example, will allow exposure and involvement of additional parties in the company and thus assist in promoting the strategy.

Trade Secrets and Data Management: The value of trade secrets is well-known and clear, but there appears to be a lack of systematic approach to identifying, managing, and protecting them, similar to data management. Consequently, these important assets are sometimes not fully integrated into the company’s IP strategy.

Regulation of Trade Secret Management: One of the major and complex challenges for IP managers and legal advisors is the regulation of trade secret management policies. In reality, this area is often not fully regulated or not regulated at all, despite the high value of trade secrets to the company, not just in the technological aspect.

Monetization and Commercialization: The survey emphasizes a critical gap in the commercialization and monetization of IP. It appears that most respondents do not actively seek monetization opportunities, and 94% lack a formal process for this purpose, despite the interest and involvement of senior management in such processes. This gap suggests the need for a more proactive approach from IP teams, making monetization a more significant part of the company’s IP strategy.

Taxation: The survey indicates that many companies do not fully utilize the tax incentives related to intellectual property.

All aspects addressed in the survey highlight the complex role of an IP manager, requiring a combination of multi-disciplinary knowledge and strategic planning, efficient communication, and real collaboration with various departments in the company, from development groups to financial departments. They must lead complex processes and have the ability to involve managers at various levels and and C-suite.

On the other hand, the many gaps identified in the survey may suggest an apparent inability of IP managers to expand their activities, engage the company’s management in broader processes, and implement complex strategies. Throughout the survey, it is evident that the more a certain issue requires broader cooperation of managers and company groups, like trade secrets, for example, the harder it is for IP managers to promote it, and often they are not handled as required.

The mentioned gaps may stem from several factors such as a shortage of personnel in the IP group, low prioritization of IP in the company, a company structure that makes it difficult for broad cooperation with the IP manager, and sometimes also from the background and experience of the IP manager and their ability to expand their role beyond managing a patent portfolio.

The survey’s conclusions can and should be taken in other directions as well. Undoubtedly, small IP teams, which characterize many Israeli companies, are often unable to address all the above issues on their own, and this is precisely where external consultants and firms can be integrated, just as they are involved in providing professional services in various IP areas such as patents and trademarks.

Rimma Pugatsch Shendelzon
Director of IP, Landa Digital Printing
Chair of IPAA