Intellectual property (IP) is as valuable and important an asset as any other company asset. Companies are vigilant in quantifying and evaluating their other assets, but often do not take the same steps in cataloguing and valuing IP. A company that does take steps to monitor their IP is in a better position to more accurately develop and pursue a strategic business plan. An IP audit will explore and examine current IP and possibly uncover unknown IP, which allows a company to make informed business decisions.
Creating a catalogue of IP aids a company in identifying where current IP can be developed for future use, what IP does not fit the business goals of the company, and what IP requires maintenance. Current IP can be used internally in developing innovations and exploring new research projects. In some instances, IP can be licensed out to create new avenues of revenue. If a company discovers underutilized or otherwise unused IP, licensing out that IP may make more sense so as to not financially burden the company. Even donating the IP to a university could be beneficial by creating positive PR for the company and provide tax deductions. IP requires money and time to protect; therefore, holding onto IP that is not beneficial creates an unnecessary drain on the company. Meanwhile, strategic utilization of IP can substantially enhance the competiveness of a business.
The IP audit also allows a company to ensure its current IP is being properly maintained. Patents, for example, require maintenance fees to be paid by set deadlines. Additionally, trade secrets require that a reasonable effort is made to keep them secret or rights could be lost. Some IP, if unwatched or neglected, can end up lost to the public domain. For patents in particular, there are possible statutory bars on obtaining patent protection after one year elapses. All of these possible pitfalls in maintaining IP also apply to unknown IP. Whether it is a specialized part or tool that could receive patent protection or a piece of machinery or process that could be a trade secret, the company should be aware of its existence and know what steps to take to ensure protect is preserved.
In addition to knowing what IP exists, an IP audit allows a company to ensure all the IP is protected in the best way. Should a patent be pursued or would a trade secret be the best method to protect? Are there possible trademarks that should be registered? Are non-disclosure agreements needed to protect secrecy? It would be impossible to protect without first identifying what IP is present. IP audits help companies perfect their business strategies, capitalize on IP through generating new avenues of revenue, and eliminate financial burdens. The information gained enables businesses to make informed and considered business decisions and to get the most out of their intellectual property.