The shock of COVID-19 to the business community has been sharp and severe. The lockdown in New Zealand has challenged all businesses, and the evolving situation overseas is creating additional problems. We’ve seen a surge in clients seeking advice on how to manage their intellectual property (IP) portfolio to meet these challenges.
I’ve been working in the IP industry long enough to remember the economic shock during the 2008/2009 global financial crisis (GFC). It created significant pressures for established exporters and start-ups. While the COVID-19 situation is not the same as the GFC, there are similarities.
Many businesses across the country are currently questioning how they can respond to, and manage, the challenges that COVID-19 is having on our business.
There is no one-size-fits-all plan. Much depends on the business and its stage of development. Some industries, like healthcare, are ramping up, while others have come to a screaming halt.
Irrespective of where you find yourself, considering the following issues when managing your IP portfolio will help you navigate your way through an economic crisis.
Cash is King.
Having cash on hand means you can meet your obligations, keep the doors open, retain key staff and continue to trade.
With that in mind, businesses may be considering whether it is sensible to invest in assets, such as IP rights, or whether to delay this. For some, choosing not to invest will be the best option. However this depends on the circumstances and a variety of complex factors.
Assess how existing IP rights relate to your business and if they are essential.
This can highlight if an IP right is superfluous and does not require further investment. If a right captures your business’ competitive advantage, is it really worth letting it lapse to reduce short term spending? You should balance this question carefully. Have a contingency fund wherever possible. Being able to accommodate unplanned costs or variations will reduce stress and improve your chances of coming through this unscathed.
Ensure you have good systems and communicate with your team.
This includes thorough budgets, clear instructions on what costs can be incurred, and decision-making criteria for potential investment in IP rights. Know when the next actions for the rights in your portfolio are likely to be due and plan accordingly.
Determine whether immediate action is necessary or if it can it wait.
Your best option may be to delay filing an application or product launch. Failure to meet certain IP deadlines can result in the right lapsing. But deadlines can be extended in many circumstances so use extensions of time to delay costs or decisions.
Pivot or partner.
We’ve seen in the US that Ford has started producing respirators to meet local demand. Australian company Medtronic has openly shared the IP rights to its portable ventilator and is rumoured to be partnering with Tesla. Closer to home, there are the distilleries who are changing from gin and whisky to hand sanitiser. Think outside of the box and adapt. Look for new partnerships where you can provide value to another company, who in return will help you. Or, change your focus to a different product or service.
If your business strategy changes, then so too must your IP strategy. Don’t be afraid to make hard decisions on investment in IP rights, but also be prepared to commit to continuing your existing plan or investing in a new one.
Understand how COVID-19 will affect all the markets you operate in – don’t assume that what applies for New Zealand customers will also apply in other markets.
Look after your team. The significance of people to a business is frequently talked about, however they are often overlooked as a form of competitive advantage. Communicate what is happening with the business, engage them on problem solving, and help with their personal challenges. You will need your team members to help the business survive during the crisis and to recover during the eventual market rebound.
Good businesses will survive and may even thrive during the COVID-19 pandemic. How you respond will determine whether you succeed or are left by the wayside. Getting input from a range of experienced sources will improve your decision making and outcomes.