Intangible Capital in Mergers

In follow-up to my posts last week about the importance of structural capital and process, I would like to address a story from the press earlier this year (in the Boston Globe, IT Business Edge and IT Knowledge Exchange)

It involves an IT consulting firm that was acquired by EMC. The founders of the firm worked for EMC for awhile and then started up a new firm that EMC says does the same thing as the original company. I won’t comment directly on the case because I don’t have enough information but I would like to comment as background to the issues around buying intangible capital as part of corporate acquisitions. Read more

Five Steps to Building a Regional Innovation Ecosystem

Our firm recently participated in the Regional Innovation & Jobs Summit hosted by the Washington Economic Development Commission. Kudos to Egils Milberg and Noreen Hobin for a very full day of content and conversation. The full day was webcast, including the intro to our session.  Also thanks to our colleague from the WA-based Ingenesist Project, Dan Robles, who took great photos of our session.

Our session came at the end of the day. After a day of talking, our role was to get people engaged and active in improving specific ecosystems for the state.  Read more

About the Authors of Intangible Capital: Putting Knowledge to Work in the 21st Century Organization

We (Mary Adams and Michael Oleksak) are both former bankers who began our careers just as the IBM PC hit the marketplace in the early 1980s. That was actually the moment when a discernible “extra” value became visible in the public markets over and above the book value of corporate assets. In hindsight, economists now tell us that this was when the knowledge era began to take off. We, like all businesspeople today, have lived with feet planted in both the industrial and knowledge eras. At Citibank and Bank of Boston, we each received training in state-of-the-art business thinking. But as time went by, it became clear that there was something else going on. The old formulae didn’t work. Assets wouldn’t cover the loan amounts companies needed to fund their operations. It was only later when we had started a consulting firm in the late 1990s, that we came to understand the shift that was underway.

Then over five years ago, we were introduced to the emerging field of intangible capital. We started an informational website, the IC Knowledge Center, and a newsletter (here’s its current incarnation) that became our way of continuing (and sharing) our learning. We also began to apply the concepts in our client work, helping technology and service companies to grow and adapt to changes in their markets. We began to see a lot of trends that have been emerging in recent years—social networking, innovation, performance and knowledge management—as threads of the same story. Eventually we felt compelled to write a book to pull all these threads together.

This is not the first book we have written together. We met and lived in the Dominican Republic over 20 years ago. At the time we were intrigued by the growing prominence of Latin Americans in baseball. We were upset when we would see sportswriters speculate (often incorrectly) on how and why baseball spread to different countries. When we couldn’t find a book on the rich history of this aspect of our national game, we decided to write it ourselves. With Beisbol, we helped set the record straight and start a new thread in the history of baseball.

This book isn’t all that different. We have lived with our clients the urgency of being able to measure, manage, and monetize intangibles. We have seen what works. But we haven’t been able to find a book that explains this in a clear, practical way. We felt we had no choice but to do it ourselves. Our hope is to get this information out to a broader audience and contribute to the important conversation about how to stimulate innovation and growth in our economy.

The ideas we express here are grounded in the best and most current research. But everything is filtered through the lens of our experience—and that of our clients—as to what really works. Our goal is to arm you with understanding and perhaps more importantly, practical tools and applications to help your organization succeed in the knowledge era.

From Intangible Capital: Putting Knowledge to Work in the 21st Century Organization

Why Intangible Capital is Important for Start-ups Too

Just had a question from a reader asking about the parts of Intangible Capital that are relevant to start-up’s. Here are a few of my thoughts:

Some of our work around enhanced reporting is not relevant to start-ups However, there are a number of areas of great relevance to start-ups:

• Being able to visualize and explain the start-up’s intangible assets (which are basically all most have) and how they work as a system. Especially important for investors but also for recruitment and strategy.
• Thinking about business models: how to get paid for what they know–including navigating between free and paid aspects of a value proposition
• Keeping track of intangible investments as a way of backing up the story of the company’s development.
• Understanding that reputation is the result of good intangibles management.

Does this make sense to you start-up gurus? I look forward to your feedback. Technorati Tags: Intangible Capital, start-up, intangible assets

The Role of the Intangibles Information Gap in the Financialization of US Corporations

The financialization of US corporations has been aided by the lack of information on intangibles (which make up 70% of total corporate value). Filling in the gap is a big part of the solution to the problem.
Read more

Case Study: Visualizing and Communicating Corporate Value Through Intangibles Management

Last week, I helped lead a full afternoon workshop organized by the Intangible Asset Finance Society at the Think Tank and Auction hosted last week by ICAP Ocean Tomo in San Francisco. (The auction was fun to watch–here are a few Tweets about the auction).

My co-presenters for the afternoon were Nir Kossovsky of Steel City Re and Andy Gibbs of CXO IP Advisory. We opened up by each making some comments about our perspectives on intangibles management and emerging intangibles markets. My slides are here–I will add links to Nir and Andy’s presentations if they are posted online.

Then we moved to a case study discussion. The discussion was very robust. Since we usually cannot share the contents of client work when we engage in this kind of exercise, it is a great opportunity to share with you how this kind of approach works in practice.

Here’s a summary of the case we gave the participants. Read more

Lessons Learned Creating an IC Community on Ning

If you follow this blog, you may have noticed a hiatus of ten days or so on my meatier posts (I keep the micro posts going through Twitter). Here’s what has been happening…

The IC Knowledge Center, a community I started at the beginning of the year is taking off! Coming at the same time that we are doing the final reviews for our book and keeping up with client work, it has been a bit of a distraction–but a wonderful one.

We just went over 125 members, all very impressive folks from all around the world. We are also getting a good start at critical mass of different perspectives. Read more

Thoughts on the Shift to the Knowledge Economy

I had a great time last week with the Association for Strategic Planning in Boston. I shared with the group a summary of the shift to the knowledge era and then led them in an exercise to talk about the significance of this shift to business.  Having been involved with ASP and well as the Institute of Management Consultants (IMCNE), I told the organizers that I wanted to avoid being a talking head–but rather to engage the group in a conversation. And it worked really well!

The group was great. It included consultants and corporates as well as grad students and professors from Suffolk University’s business school (our hosts). Read more

The Answer to Your Questions Is Probably Inside Your Company

There was a great story in the NY Times awhile back about the new co-CEO at Motorola, Sanjay Jha, Strategy of New Chief at Motorola Appears Poised to Pay Off. It explained:

Looking back, Mr. Jha said that Motorola was in worse shape than he knew when he took the job, largely because of a dysfunctional management culture that missed the shift in consumer preferences from phones intended primarily for talking to those that do nearly everything a computer can do. The company’s engineering talent, which had once developed great phones, remained intact, he said.

As luck would have it, one of those engineers, Rick Osterloh, grabbed Mr. Jha just as he stepped off the stage at that first town meeting in August 2008. Read more

Intangibles and Airplane Security

Last night on NPR, I listened to a report on the heightened security measures that are being put in place in airports around the world.

Listening to the report, I couldn’t help but think that our leaders are getting the balance between tangible and intangible efforts wrong. Read more

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