Introduction
Knowledge is vital asset
How can intellectual property be used as a business tool?
Latin America is the region most affected by the pandemic, according to information from the World Bank, and has experienced enormous economic and social costs. It is predicted that this situation will have a long-term impact on the economies of the region. In this sense, Mexico is one of the countries furthest behind due to the absence of a fiscal response. Therefore, it is expected that Mexico's economic recovery will be slower and incomplete.
Within this context, bricks-and-mortar businesses, as well as those based on models closely dependent on their physical infrastructure, were among the most affected. Tangible assets such as buildings, machinery and equipment wear out, run out and eventually become obsolete. Tangible assets also normally require special maintenance or updating. In these current times of scarcity, uncertainty and lack of control, that process is very complicated.
There is no other option but to adjust and make a great effort to get ahead in the face of this novel and constantly changing situation, but it must be done in an intelligent way. According to the popular saying, crisis is synonymous with opportunity, but this is true only for those who know where to find the opportunity. And if the "old" tangible assets are not the best option to revitalise the economy, then what is? One option is knowledge.
Knowledge is an intangible asset that does not suffer wear and tear; it can be viewed both as a resource or as an inexhaustible asset for companies. Knowledge and innovation have already been widely recognised as engines of the economy and this function is magnified in times of crisis. In these times, knowledge is the most important asset for a Mexican organisation to preserve or to increase its competitiveness. This is especially the case for small Mexican companies that have suffered the most from the blows of the pandemic, because their physical infrastructure was not strong enough to face such an adverse climate.
So, in times of crisis, it is important to promote a generation of new knowledge, to create new products or services, or to improve processes. If a company bets on a generation of knowledge and innovation, it will always bet on differentiation. And if a company manages to differentiate itself with an interesting and relevant value proposition, it will stand out from the competition.
But it is important to consider that while knowledge has the potential to promote economic recovery, its incorporation brings challenges. Knowledge is an intangible asset that cannot be controlled with physical means or barriers, unlike tangible assets.
While a car, for example, can be kept in a locked garage, knowledge cannot. If a company develops a new air bag for vehicles that improves the protection of its occupants in a side collision, the disclosure of this in a scientific article about it, or the commercialisation of a car that includes it, would be enough for a third party to copy and build it. If the original manufacturer of the air bag is a small Mexican company and the one who seeks to copy it is a large international company with more muscle for manufacturing and distribution, the small company may see its competitive advantage diluted or even nullified if it does not have control over its knowledge in the development of its product.
How can intellectual property be used as a business tool?
Thus, knowledge is a vital asset for competitiveness and reactivating the economy, especially in times of crisis and for small or medium-sized companies, but how can you have control over knowledge? The answer lies in intellectual property. While intellectual property is a legal concept, it is primarily a business tool. Intellectual property includes patents, trademarks and industrial secrets, among other legal devices. These allow control over different aspects of the creations of the human mind. Through intellectual property, innovators can protect their competitive advantage and even maximise the value of their knowledge assets. They can exclude others from exploiting them and avoid any issues with copying. It is also possible to capitalise on a company's intellectual property by using different financially advantageous mechanisms. For example, a small Mexican company can manufacture the previously referred to air bag in Mexico, but at the same time it could choose to take advantage of the capabilities of the large company to obtain an additional economic benefit from the commercialisation of its product abroad, by granting a licence.
It is therefore important that Mexican companies see intellectual property as an option for economic recovery from the pandemic, and also as an option to provide long-term sustainability.
For further information on this topic please contact Mariana González Vargas at Becerril, Coca & Becerril SC by telephone (+52 55 5263 8730) or email ([email protected]). The Becerril, Coca & Becerril SC website can be accessed at www.bcb.com.mx.