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International Journal of Recent Technology and Engineering (IJRTE)
ISSN: 2277-3878, Volume-4 Issue-2, May 2015
75
Retrieval Number: B1423054215/2015©BEIESP
Published By:
Blue Eyes Intelligence Engineering
& Sciences Publication
Evaluation of Organizational Intellectual Property
Management Decision Structure using
Organizational Risk Analyzer (ORA)
Lois Onyejere Nwobodo, Hyacinth C. Inyiama
Abstract-The optimal exploitation of intellectual property (IP)
as a strategy requires effective IP management structure. Many
organizations have developed and implemented Intellectual
Property Management System (IPMS). However the issue
remains the problem of evaluating the effectiveness of the
organizations IP management mechanism. The evaluation
enables the benchmarking of the performance of the
organizations IP management structure and provides the basis
and information for possible re-engineering of such management
architecture. The simplicity of the balanced scorecard does not
allow it to factor in the complex interaction that exists in the
organization which impact on effective IP management. This
paper proposes the Organizational Risk Analyzer for the
evaluation of the performance of IP management structure. The
ORA metrics (ORA measures) is presented to indicate how its
evaluation enables the assessment of the efficiency of an
organizations IP management decision structure.
keywords: IPM, decision structure, organization
structure, ORA, decision structure evaluation.
I. INTRODUCTION
Within the context of the knowledge economy intellectual
property has become an important measure of corporate
value. The structure(s) and processes utilized for its
management impact greatly on the ability of a firm to
leverage on the enormous benefit of IP and effective IP
management structure or organizational design is vital to
advance to and support the higher and more sophisticated
level of IP strategy with reference to the pyramid of IP
management. Structural adaptation can be objectively made
if an organization can properly evaluate the effectiveness of
its IP management decision structure. This paper proposes
the Organizational Risk Analyzer to carry out such
evaluation. The ORA is shown (on the basis of the meta-
matrix) to factor in the complex interaction that influence IP
management decision making.
II. INTELLECTUAL PROPERTY
Intellectual property (IP) describes ideas, inventions,
technologies, artworks, music and literature, all of which are
intangible when created, but becomes valuable in the
tangible form as products or service [1]. IP includes all the
sensible and intangible property a firm has, including
contextual information and digital assets that are the result
of the innovation process [2]. This definition of IP is
instructed in figure (taken from [2]).
Revised Version Manuscript Received on May 29, 2015.
Engr.(Mrs) Lois Onyejere Nwobodo, Computer Engineering
Department, Enugu State, University of Science and Technology [ESUT],
Enugu, Nigeria.
Engr. Prof Hyacinth C. Inyiama, Electronics/Computer Engineering
Department,, Nnamdi Azikiwe University[Unizik], Awka, Anambra State,
Nigeria.
Figure 1: Definition of IP
IP is a crucial contributor to the emergency and evolution of
the knowledge economy and generates monopoly position in
return for providing payoff to innovation [1]. Intellectual
property management (IPM) approach aims at generation of
IP, protection, and converging the same into the market and
increasing revenue. IP is a very important element of an
organization. Patents, trademarks, trade secrets etc are assets
that increase the value of a company. These assets are a
special category of business assets which are named
intangibles [3]. But where do the intangible assets stand in
an enterprise? How is it related to IP? The intangible assets
and IP can be understood only in the enterprise context,
where they are created, used and produced the most of their
value. Every enterprise small or large is compounded by
three basic elements [4];
1. Monetary assets
2. Tangible assets
3. Intangible assets
Enterprising = monetary assets + tangible assets + intangible
assets.
The reference [6] defined intellectual capital (IC) as a
knowledge that can be converted to value. [6] also
determined that IC has two main components: human capital
(ideas we have in our heads) and intellectual assets (ideas
that have been codified in same manner). Within
intellectual assets, there is a subset of ideas that can be
legally protected, called intellectual property (IP). (see
figure 2 taken from [3] );
Evaluation of Organizational Intellectual Property Management Decision Structure using Organizational
Risk Analyzer (ORA)
76
Retrieval Number: B1423054215/2015©BEIESP
Published By:
Blue Eyes Intelligence Engineering
& Sciences Publication
Figure 2: Intellectual property within the context of
intellectual capital
Intellectual property are intellectual assets which are
protected by law. The aim of management is “to produce”
intellectual property [3].
III. THE VALUE HIERARCHY OF IP
MANAGEMENT
The reference [3] structure the value Hierarchy, which is a
pyramid with five levels. Each level represents a different
expectation that the company has about the contribution that
its IP function should be making to the corporate goals. Like
building blocks, each higher level relies on the foundation
of the lower levels and contribution to the shareholder value
(see figure 3).
Figure 3. The value hierarchy of IP management (the
pyramid of IP management) [3].
3.1. Defensive level
When a corporation owns an intellectual asset, it can prevent
competitions from using the asset. At this level companies
use their IP for defensive purposes only and view IP as a
legal asset. Their goals are use to protect their own
innovations, to ensure that they don’t infringe the IP of
others. The cons in fitting fees, enforcement and other legal
expenses can be high.
3.2. Cost control level
Companies at this level still have a defensive approach, but
how focus on finding ways to obtain protection while
simultaneously reducing the costs of creating and
maintaining their IP portfolios.
3.3. Profit center level
Companies of this level turn their attention to more
proactive strategies that can generate a great amount of
additional revenues while further contriving to trim costs.
Passing from the previous levels of activity to this one
requires a major change in a company’s attitude and even its
organization. It’s management processes, decision structure
and mechanism i.e its organizational structure. Effectively
making such changes in its management structure requires
the means to qualitatively and quantitatively evaluate its
structures and processes that impacts on it decisions. Such
systemic evaluation requires the framework that optimally
considers the structure and dynamics of modern
organization.
3.4. Integrated level
In this level, the IP function serves the organization as a
whole. Here the company’s business units have grasped the
power of using IP for a range of business roles. IP use for
business becomes integrated across all of the company’s
business activity.
3.5. Visionary
At this level of IP management sophistication companies
take a long-brim view of the company’s role in business and
in its industry. They seek to use the company’s IP to create
more strategic value. Though it should not be inferred from
this pyramid that the highest level of sophistication equates
to the “best” level of IP management, every company can
improve their position in the pyramid. This would require
changes as pointed out earlier (see rotes under the integrated
level of the pyramid). Since effective organizational changes
has to be evaluation driven, it should require sophisticated
evaluation procedure for an effective IP management
decision stricture. (i.e management structure and processes)
to be put in place and integrated into the organizations IP
management systems. Each level of the pyramid serves as a
building block for levels above it.
IV. INTELLECTUAL PROPERTY
ADMINISTRATION AND INTELLECTUAL
PROPERTY MANAGEMENT
IP management is an important set of concepts, methods and
processes created to fit intellectual property (IP) of the firm
with defined objectives and business strategy [3]. IP
administration and IP management are often confused but
they differ from each other. As illustrated in figure 4, while
IP administration mainly deals with the IP asset itself(the
acquisition, preservation and all legal aspects), the central is
the integration of IP innovation strategies and business
models. [3]. To put it simply, IP administration strives to
enable the usage of the legal and economic functions of IP:
The protection of an invention (patents, to
exclusively identify and protect the
commercial source of a product or service
(trademarks)
To block competition (IP rights)
And to enable inventory stocks, licenses.
Those functions may have an economic effect for example,
they prevent a competitor from offering similar functionality
in its products. It is the task and responsibility of IP
managers to appropriate those functions and the economic
consequences for the benefit of the company; in other
words to make sure that the company actually can cash in on
IP and its effects.
As a rule, the economic
benefit of the company is a
cash flow (of some sort).
International Journal of Recent Technology and Engineering (IJRTE)
ISSN: 2277-3878, Volume-4 Issue-2, May 2015
77
Retrieval Number: B1423054215/2015©BEIESP
Published By:
Blue Eyes Intelligence Engineering
& Sciences Publication
Therefore, the target figures of IP management are key
operational figures such as rate of return, profitability and turn over [4].
Figure 4: The difference between IP administration and IP management (source [5])
Today, even technology start-ups and spin-off companies
have started commercializing innovations and existing
technologies [5]. However, successful commercialization of
innovation requires that the know-how in question be used
in conjunction with other capabilities or assets [6].
Companies gain advantage by taking a proactive, multi-
disciplinary approach to managing the complete body of IP
– ideas, digital assets, patents, filling, internal invention
disclosures, trade secrets etc. all of which are critical to
growth and competition in an ever changing business
environment. Organisations have developed Intellctual
Property Management System (IPSM) to some extent cater
for their needs, and ensure availability of information and
database for strategic decision making. However, there exist
the problem of measuring and evaluating the mpact of any
decision architecture put in place for intellectual property
management. There is need for a framworkthat facilitaes the
qualitative and quantitative evaluation of the impact,
efficacy and efficiently of the IPM decision structure the
organization. The evaluation framework should enable the
evaluation of the IPM model, processes, methods and
concepts adopted by the organization. The evaluation
method has to be such that it considers intellectual property
structural as a Team sport, it not only factors in all the five
components of an effects organization and design as
depicted in the wheel in figure 6, but also the alignment of
the five components to one another in evaluating IPM
decision structure.
4.1. IP management and strategy is a team sport
Protecting, managing, leveraging and commercializing IP is
a team sport that refines key players from corporate, Legal,
Research of Development (R&D), Engineering,
Technology, Manufacturing, and construers [2]. Figure 5
depicts this concept.
Figure 5: An effective IP team helps ensure that IP development and needs align with business strategy.
Evaluation of Organizational Intellectual Property Management Decision Structure using Organizational
Risk Analyzer (ORA)
78
Retrieval Number: B1423054215/2015©BEIESP
Published By:
Blue Eyes Intelligence Engineering
& Sciences Publication
For example, when creating an innovative new product or
technology, marketing and R&D teams determine key
performance or functional requirements that must be met.
Development teams focus on designing the right product or
technology to meet those requirements and they must either
mine existing IP for quick time to market or create a strategy
for protecting the innovation with a smart IP strategy.
The team sport view of IP management and strategy
facilitates both the design of effective decision structure and
the design of workable model required to evaluate the
performance of such decision structure. The team view of IP
management decision processes is not without a sound
classical theoretical basis. In their formulation of “team
theory authors in [7] postulated that each member of a
group of actors has some (possibly null) initial information
about the world and some (possibly null) ability to control
certain actions in the world. A team also has some shared
payoff function that determines, for a given state of the
world, the value team members attach to the results of the
different possible actions. Since in general, this team
members who most take actions do not posses all the
relevant information about the world, there must be some
information structure that determines how members
perceive and commutate information and there must also be
some decision structure that determines how members
decide what actions to take based on the information they
receive. The goal of an organizational designer may be
thought of as choosing an information structure and a
decision structure that maximizes the net payoff to the team
members, i.e, the gross payoff less the cost of commutating
and deciding.
The actors in this Team view of IP management and strategy
can be thought of as decision making units as a collection of
one or more people and associated mechanisms that act,
from an organizational perspective as a single actor.
V. ORGANIZATION STRUCTURE AND IP
MANAGEMENT PERFORMANCE EVALUATION
Effective organizational design considers five, interrelated
components as illustrated in the wheel, figure 6.
Figure 6. source: Bain and company organizational
toolkit and Bridgespan analysis.
1. Leadership
Clear vision and prentices
Cohesive leadership team
2. Decision making and structure
Clear roles and accountabilities for
decisions
Organizational structure (decision
structure) that supports objectives
3. People
Organizational and individual talent
necessary for success
Performance measures and incentives
aligned to objectives.
4. Work processes and systems
Superior execution of programmatic
work processes.
Effective and efficient support processes
and systems.
5. Culture
High performance values and behaviors
Capacity to change.
Principles of effective organizational structure or design [8];
Consider all five components of the “wheel”
Align the five components to one another
Align strategy and organization to one another.
Organization structure (decision structure) have two
components [9] groupings and linking of activities;
Grouping: - how individuals, jobs, functions or activities
are differentiated and aggregated
- optimizes information flow within the
group but typically creates barners
with other groups.
Linking:
Mechanisms of integration used to
coordinate and store intimation across
groups.
Enable leadership to provide guidance and
direction across the organization.
5.1. How the components of these organization
structure maps into the proposed evaluation
model.
The grouping maps into the organizational risk analyzer
(ORA) network mode. The linking maps into ORA edges. It
can be deducted from [8] that the organizational structure
can be formally represented in terms of messages (lines in
the ORA Network model) and decisions (node in the ORA
network model). The ORA is discussed in section
organizational structure provides the framework within
which various coordination and control mechanism can be
brought to bear on IP management processes. Such
mechanism are in fact types of information processing
systems that should be used to continually improve the
decision making performance towards the effective
management of IP.
International Journal of Recent Technology and Engineering (IJRTE)
ISSN: 2277-3878, Volume-4 Issue-2, May 2015
79
Retrieval Number: B1423054215/2015©BEIESP
Published By:
Blue Eyes Intelligence Engineering
& Sciences Publication
This one of the primary determinant of effective IPM
decision marking system can be seen in terms of the
continual evaluation of its effectiveness among other things
as it relates to the resolution of uncertainty with the IPM
environment.
5.2. Evaluating performance of IPM structure and
processes
Given the understanding that IP is a core element of a
successful organization it becomes vital to be able to
evaluate the IPM decision apparatus of a form. This
evaluation gives managers the possibility to reflect the
consequences of decision made based on current IPM
process and structures and hence pare the way for new,
better informed decisions mechanism. The balanced
scorecard is a well known management scorecard [10]. The
balanced scorecard has mostly been used in managing and
controlling the holistic performance of organizations.
Scorecards have also been used in the analysis and
management of intellectual property rights assets [11]. From
a decision-making science-point of view, the basic form of a
scorecard is a rather simple multiple criteria decision
analysis (MCDA) tool, an elementary non-weighted scoring
system that uses a numerical scale in ranking. The
elementary nature of the scorecard makes it non suitable in
the evaluation of complex decision that the scorecard have
to undergo some changes if it must be used for decision
support that uses estimate of future values as a base.
Due to this limitation, the scorecard cannot factor in the
effect of the complex interactions of the elements of the
“wheel” or the complex interaction of the actors based on
the perspective of the “team theory” views of organizational
decision structure.
Hence an evaluation model that factors in such complex
interaction that characterizes the IPM environment is
necessary. The Organizational Risk Analyzer (ORA) models
an organizational structure as a set of interconnected
networks connecting different organizational entities. This
makes it able to factor in the effect of the interconnected
elements of the “wheel” and the interactions of actions in
the team sport view of the IPM environment. This ensures
its suitability for the evaluation of the IPM decision systems
efficiency.
VI. ORGANIZATION RISK ANALYZER (ORA)
ORA is a network analysis tool that detects risks or
vulnerability of an organization design/decision structure.
The design/decision structure of an organization is the
relationship among its personnel, knowledge, resources and
tasks entities. These entities and relationships are
represented by a collection of networks called META-
MATRIX. ORA analyzes the meta-matrix using measures
and read and writes network data in multiple formats to
make it interoperable with existing network analysis
software.
The modeling of organizations as network and the
development of measures to examine their decision structure
is well developed. Even a cursory analysis of the literature
reveals a wide variety of measures of assessing
organizational risk and vulnerability [13][14][15]
6.1. The Organization as Meta-Matrix
The main unit of input in ORA is the organization. An
organization can be modeled and characterized as a set of
interlocked networks connecting entities such as people,
knowledge resources, tasks and groups. These interlocked
network can be represented using the meta-matrix
conceptual framework [16][17], presented in table 1.
Table 1: Meta-Matrix for Organizational Design.
A variety of networks exist within and among
organizations. Meta-matrix can be understood to be the
networks connecting the four key corporate entities-agents,
knowledge, resources, and tasks (see table 1). Various
aspects of organization can be characterized in terms of
these networks. For example, structure (such as the authority
structure or the communication structure) is defined in terms
of the interaction network connecting people to people.
Culture can be defined in terms of the knowledge network-
the connections of people to knowledge. And so on. The
mathematical description of the ORA Network model is
beyond the scope of this paper. Some of the ORA metrics
are: Access index knowledge base, cognitive load,
communication congruent loads, Resources congruence,
actual workload, communication, and personnel cost. For
the definition of these measures, including their
mathematical expressions, see the organization risk
Analyser Technical report.
6.2. Evaluating IPM decision Structure using ORA
For the evaluation, the ORA takes as input the IPM structure
and processes of the company (i.e the firms organizational
structure for IPM) as a meta-metrix. Based on this and with
reference to the meta-metrix conceptual framework, the
following can be referenced and referred specified: IPM
interaction network, IPM knowledge network, IPM resource
network and IPM task network. The IPM decision system of
the organization is optimized if these networks are
engineered such that the identified vulnerabilities of concern
to the organization are minimized. Inputing the IPM
structure of the company into the ORA network model, the
ORA metrics for the IPM performance of the company are
evaluated. For such evaluation entities (human management
or machines) responsible for taking IP management
decisions are mapped into “Nodes” while relationships
existing between the nodes are mapped into “Edges” in the
ORA network model.( refer to the organization Risk
Analyzer Technical Report).
Evaluation of Organizational Intellectual Property Management Decision Structure using Organizational
Risk Analyzer (ORA)
80
Retrieval Number: B1423054215/2015©BEIESP
Published By:
Blue Eyes Intelligence Engineering
& Sciences Publication
To improve performance of the IP management decision
structure (i.e the organization structure for IP management),
the communication congruent, resource congruent must be
maximized, and the variation in actual workload must be
minimized. On the other hand, to improve adaptability the
variation in cognitive load should be minimized. Hence,
optimizing an IPM meta-matrix for performance or for
adaptability requires optimization with criteria created as a
sum or a product of the ORA metrics. The evaluation of the
ORA metrics associated with IPM decisions structure
enables organization to benchmark decision performance.
This enables the firm to validate the efficacy of adopted
IPM architecture.
VII. CONCLUSION
IP is a valuable and strategic asset of great companies.
Effective IP management structure is required for the
organization to effectively appropriate its intellectual capital
for its optimal benefits. However to be able to leverage on
this, there has to be an effective measures to evaluate the
performance of such decisions structure. Due to its
capability to model the complex interaction of the different
elements of an organization, the ORA was proposed as the
right tool for this kind of evaluation. With reference to the
organizational structure view, the decision framework can
be represented in terms of messages (links of the MATA-
MATRIX) and decisions (nodes of the MATA-MATRIX).
The evaluation of the ORA metrics for the IPM structure of
an organization enables the firm to a certain the impact of
their IPM structure. Based on this evaluation, the company
can understand weaknesses in its decision structure. The
ORA evaluation provides the data that helps the firm to
objectively make modifications to its IP management
structures and processes.
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AUTHOR PROFILE
Engr.(Mrs) Lois Onyejere Nwobodo, Computer Engineering Department,
Enugu State, University of Science and Technology [ESUT], Enugu,
Nigeria.
Engr. Prof Hyacinth C. Inyiama, Electronics/Computer Engineering
Department,, Nnamdi Azikiwe University[Unizik], Awka, Anambra State,
Nigeria.
