The impact of intangibles—unlock unseen value

An industry-agnostic opportunity

Intangible assets, such as institutional knowledge and intellectual capital, are becoming increasingly important for growth and value creation across various industries. The protection and management of intangible assets goes beyond just the legal protection of IP rights.

Efforts should involve internal and external legal and business partners working together to identify, protect, manage, and commercialize intangible value. However, many companies have yet to fully grasp the importance of proper stewardship of intangible value to their future growth and success. In fact, 94% of respondents to Deloitte’s recent IP 360 Survey said their company doesn’t have a formal process for asset monetization, only one that is largely ad hoc.

Efforts should go beyond the traditional focus on the legal protection of IP rights and should tap internal legal resources as well as external legal and business partners, working in coordination to identify, protect, and unlock intangible value. Here’s how:

Taking a business-first approach to intangibles

1.  Identify intangibles across the organization

Managing and enhancing the value of intangible assets requires a holistic and multi-disciplinary approach. Companies could look into conducting broad examinations or audits of their intellectual capital, including knowledge, relationships, human skills, organizational culture, data, systems, software, reputational assets, research and development insights, trade secrets, and other confidential information.

Regular reviews of intangibles portfolios are necessary to keep strategies up to date and aligned with business objectives. Know-how is the number one intangible asset that drives competitive advantage, and data is consistently undervalued as a driver of revenue and value.

Companies may want to invest in upskilling and auditing the value created by their investment in intangibles to define where pockets of value lie and disseminate knowledge about the scope and importance of intangibles throughout the organization.

2.  Protect the value of intangibles

The protection of intangible assets such as new technologies, intellectual capital, software, and data has become increasingly difficult using traditional methods. Intangibles should be viewed as something that will permeate corporate strategy and policy as well as drive growth and market share.

Cyber threats pose a significant risk to intangibles that are not protected by traditional IP rights, making it essential for companies to focus on cybersecurity, data policies, and internal controls to protect their digital assets.

3.  Unlock intangible value

Intangible assets can provide long-lasting benefits to a company, but conventional accounting practices do not measure them as creating a long-lived capital asset. There are growing calls for more transparency around intangible assets in financial statements, and organizations should be looking beyond just their IP to understand and articulate how their broader intangibles drive business value.

However, the value potential of intangibles will not always be obvious to all leaders and managers in an organization. It can be useful to pursue a discrete initiative to spread knowledge of how a company has invested in intangibles, and greater understanding across the organization of the value of the company’s intangibles will naturally foster their deployment and leverage.

Maximizing value with a new mindset

Intangibles management that takes the broadest view of where value resides and how intangibles can be enhanced and commercialized will bring advantages to every organization. This proactive approach can help a company find its best growth path, while also avoiding pitfalls that might squander the investment it has made.