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

Intangibles Measurement II: Investment

Here’s the next installment in my intangibles measurement series. I always warn folks that this the most radical of the three types of intangible measurement, although it shouldn’t be.

Today, any money you spend on building intangibles gets expensed. Even if you are investing money to build something you expect your company to use for many years to come. This means that most of the money spent on developing internal knowledge systems, operational processes and even relationships with key partners is treated as a direct operating expense on the income statement in the year that you make the investment.

There are a lot of valid accounting reasons why this is the case. I’m not out to change accounting. But I  focus on helping companies make better decisions to grow and improve performance. And the secret to that, except when my clients are buying a new machine (which isn’t that common), is to invest in intangibles like process, IP, people and networks.

So here’s my radical proposal: keep track of how much you are investing in intangibles every year. Read more

The State of Intangibles Measurement - KPI’s Are An Imperfect Answer

In the industrial economy, we had lots of ways of measuring our work. It was a mostly physical process so we could literally see what was going on. Our financial systems were built around this industrial model and we could also put dollar values on products as they progressed through factories and machines, converting raw materials into finished goods.

The shift to a knowledge economy has changed that. A lot of the value created today happens inside peoples’ heads or their computers. This is the case in service and technology businesses but even in manufacturing settings where it is the process, not the product, that creates so much of the value. Read more

2009 the Year of Measurement?

Jonathan Salem Baskin posted a report on a session he hosted at the Consumer Electronics Show. I met Jonathan at the Intangible Asset Finance Society (IAFS) and had some interesting conversations around branding and the value of brands (his area of expertise). The three main conclusions of the session Read more