Proceedings of the 3rd European Conference on Intellectual Capital

Albrecht Fritzsche and Rebecca Geiger
The company finds itself in a position equal or weaker than <strong>the</strong> competition. It uses patenting to
disrupt <strong>the</strong> innovative activity in <strong>the</strong> o<strong>the</strong>r companies. At <strong>the</strong> same time, it secures its own intellectual
property.
The company concentrates on a specific niche <strong>of</strong> <strong>the</strong> market. It avoids direct competition. Instead, it
co-operates with o<strong>the</strong>r companies by developing complementary products and services.
The company focuses on licensing. It <strong>of</strong>fers patents on innovations that play an important role for
research and development in o<strong>the</strong>r companies, ei<strong>the</strong>r by contributing to a new technical solution or
by claiming rights on an innovative characteristic <strong>of</strong> an existing product.
Fur<strong>the</strong>r on, we refer to (1) technical leadership, (2) aggressive competition, (3) claiming niches and (4)
licensing as <strong>the</strong> four strategies <strong>of</strong> patent management.
Internal functions <strong>of</strong> patenting are not considered in this framework. Cohen et al. (2002) and Hall et al.
(2000) show that patents are also used for performance measurement in research and development.
There is no doubt that performance measurement can also contribute to gaining a competitive advantage,
both as a means to organize innovative activities and to encourage <strong>the</strong> employees. However,
patents can only serve as a performance indicator if <strong>the</strong>y have ano<strong>the</strong>r positive effect for <strong>the</strong> company
as a claim <strong>of</strong> possession to <strong>the</strong> outside. In that sense, internal functions <strong>of</strong> patenting should ra<strong>the</strong>r be
considered as reflections on external functions patenting.
4.3 The tactical perspective on patent management
Having clarified <strong>the</strong> strategies <strong>of</strong> patent management, it is now necessary to discuss how <strong>the</strong>y are
pursued from a tactical perspective. As mentioned before, it is necessary to make a distinction between
<strong>the</strong> tactical move itself and its instrumental value. Tactical moves are not necessarily exclusive to one
strategy. Registering a patent for a basic innovation that is fundamental for <strong>the</strong> development <strong>of</strong> <strong>the</strong>
whole industry, for example, is useful for technical leadership and aggressive competition as well as for
licensing. In addition, <strong>the</strong> activity <strong>of</strong> <strong>the</strong> tactical move must not be mixed up with <strong>the</strong> expected effect. An
enhanced reputation or a stronger position in negotiations is clearly an effect, while fencing or surrounding
<strong>the</strong> patents <strong>of</strong> <strong>the</strong> competition by one's own patents describes an activity. The tactical moves
that can be derived from <strong>the</strong> review <strong>of</strong> <strong>the</strong> literature are presented in <strong>the</strong> following table.
Table 3: The tactics <strong>of</strong> problem solving
Activity Effect
1. Offering licensed access to pat- Control <strong>of</strong> technical development, influence on competitive activity,
ented invention
financial revenue, enhanced reputation.
2. Mutual cross licensing <strong>of</strong> patents Involvement in technical progress, mutual dependency, shared
with o<strong>the</strong>rs
costs.
3. Establishing patent pools with Involvement in technical progress, shared costs, better communica-
free access to all contributors
tion with o<strong>the</strong>rs.
4. Standard setting by free access Control <strong>of</strong> technical development, influence on competitive activity,
to patented content
enhanced reputation.
5. "Ad hoc" blockade <strong>of</strong> competition
Specific protection <strong>of</strong> an innovation
for a single product
6. Registering a patent for a basic
innovation
7. Flooding an area <strong>of</strong> technical
development with numerous
patents
8. Registering patents that work as
a fence in certain directions <strong>of</strong>
technical development
9. Surrounding <strong>the</strong> patents <strong>of</strong> <strong>the</strong>
competitors by one's own such
that <strong>the</strong>y cannot be exploited
Exclusion <strong>of</strong> o<strong>the</strong>rs from technical development, reduction <strong>of</strong> competitive
activity, enhanced reputation, increased value <strong>of</strong> <strong>the</strong> com-
pany
Disruption <strong>of</strong> technical development in o<strong>the</strong>r companies, reduction <strong>of</strong>
competitive activity, enhanced reputation, increased value <strong>of</strong> <strong>the</strong>
company
Exclusion <strong>of</strong> o<strong>the</strong>rs from technical development, reduction <strong>of</strong> competitive
activity
Blocking <strong>the</strong> technical development <strong>of</strong> a competitor
10. Hybrid tactical moves and o<strong>the</strong>r
means <strong>of</strong> protection
Combination <strong>of</strong> o<strong>the</strong>r effects
The literature on patent management allows different conclusions about <strong>the</strong> applicability <strong>of</strong> <strong>the</strong> tactical
moves in pursuing a specific strategy. Table 4 compares <strong>the</strong> opinions <strong>of</strong> <strong>the</strong> various authors, as far as it
was possible to extract this from <strong>the</strong>ir arguments.
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