We generally think of intangible assets in discreet categories. Depending on which framework you choose, these include worker skills and know-how, innovative work organizations, business methods, brands, and formal intellectual property, such as patents and copyrights (see my earlier paper Intangible Assets as a Framework for Sustainable Value Creation). Increasing we see descriptions and analysis of asset complementarities and the interactions among intangibles. For example, there are clearly synergies among knowledge creation, human capital (workers skills), and organizational features and capabilities.
However, there are times when the development of different intangible assets can be at odds with one another. The following insight on enforcement of patents from Stephen Miller (What Do Patents Mean? in Issue in Science and Technology) is a case in point:
“Another reason a company may take no action against a likely infringer is that the company already has an existing or potential relationship with the infringing company, often in another sector or sectors of business, as a partner, a customer, or a supplier. If the real or perceived value of that relationship is greater than the estimated value of the invention, which in its early stages is usually quite uncertain, then the patenting company may choose not to go after the infringer. I saw this happen at a time when my company was negotiating a business deal with another company that I was confident had been infringing one of my patents. Our management decided the value of the deal being negotiated was greater than the value of the technology under my patent, so they refused to try to enforce it.”
So, the goal of maintaining relational capital was in conflict with the protection of intellectual property (and ultimately with the R&D investments made to produce that intellectual property). Are there any other examples where intangibles might work at cross-purposes?
By the way, Miller’s article is a straightforward discussion of how patenting works in the real world. If you want to understand How companies really use patenting and (one of my pet peeves) why patents are problematic indictors of innovation, read this article.