When business owners think about
intellectual property, it’s often in
the context of products or manufacturing processes. But other forms of
intellectual property can be just as valuable, and should be protected accordingly.
“For 12 years I worked in the electronics
field where product and process development and the protection of that work
through the application for and enforcement of patents was a central part of the
business,” says John Kilgarriff, account
manager at The Graham Company. “Intellectual property protection doesn’t just
work in high tech — it can be applied to a
broad range of industries.”
Smart Business spoke to Kilgarriff
about why companies should consider
protecting their business assets.
Why should companies protect their intellectual property?
Virtually every company relies on proprietary or confidential information to
develop and grow their business. For
most organizations, this information is the
company’s most valuable asset. It needs
to be protected in order to preserve the
company’s competitive advantage. Intellectual property includes all kinds of
intangible assets, including processes,
procedures, formulas, copyright, trademarks and trade secrets. In many industries this protection is essential for the
continuation of a business.
Consider a media company’s protection
of the rights to their music; a software
company’s protection of its applications
from piracy; or even a baker with a great
recipe for chocolate chip cookies. All of
them have the need to protect their proprietary information. Many other companies with less obvious intellectual property assets also have a strong interest in protecting their rights.
How do companies protect their intellectual
property?
The initial way to protect intellectual
property is to have good internal controls
on the distribution and the access to materials that differentiate a company’s services or products from its competitors. For
example, use non-disclosure agreements
whenever sensitive details are being disclosed to others. The next step is for companies to take action to patent or copyright
proprietary information that is destined to
be widely distributed, such as their products or published materials. It could be
marketing materials, an innovative way to
solve a technical problem, published analytical work, or some other form of their
work product. These are things that are patentable or can be copyrighted and can secure a competitive position against others.
The Graham Company, for example, has
copyrighted the standardized framework
that we use to evaluate the insurance programs of our clients. Our work product is
something that we’ve spent a significant
amount of effort, time and resources to
hone and develop. The copyright enables
us to protect our rights in the event someone sought to use this material without
permission.
What should companies know about infringement of intellectual property?
The increasing number of U.S. patents
issued and the never-ending availability of electronic content via the internet have
dramatically increased the risk that a
company could unintentionally infringe
on someone else’s intellectual property.
Companies can reduce this risk by being
careful about the material they publish
and by not engaging in certain activities
that could lead to infringement. Businesses should have documented internal
procedures that make sure that their
employees research the sourcing of information before it is distributed or used in
the business.
A final way companies can reduce risk is
to transfer it by requiring indemnification
from others who work on their behalf or
by purchasing insurance.
A standard general liability policy provides a very limited amount of protection,
mostly related to how businesses might
infringe upon intellectual property of others in their advertising. But, if it’s a company that has a Web site or that does any
kind of development of work product, be
it training manuals or marketing materials, there is an increased exposure. And
depending upon the nature of what they
do, the protection afforded in a standard
general liability policy may not be sufficient. Insurance products that will provide broader coverage for infringement
on the intellectual property of others are
available in today’s marketplace.
How does a background in technology relate
to being an insurance broker?
The best parallel I can draw is that when
I worked in semiconductors, my role
involved enabling communication among
people of a variety different backgrounds
— technical, marketing, finance. At the
end of the day everyone needed to grasp
the issues in order to proceed — no matter
how obscure they may have been.
Being able to work through details and
still deliver concise, effective programs to
clients is something that my previous
background in technology development
has really allowed me to do effectively in
the insurance world.
JOHN KILGARRIFF is an account manager at The Graham Company. Reach him at (215) 701-5425 or [email protected].