EXTRACTING VALUE OUT OF FORD'S INTELLECTUAL CAPITAL PORTFOLIO JAY DROUILLARD ASSOCIATE GENERAL COUNSEL FORD GLOBAL TECHNOLOGIES, INC. Copyright 2001 Ford Global Technologies Inc.
PURPOSE • Define Intellectual Capital • Review the global IP environment • Explain “why” FGTI • Discuss strategic new initiatives with FGTI • Review IC and Knowledge Management at Ford • Outline key value extraction strategies • Summarize the benefits to Ford Copyright 2001 Ford Global Technologies Inc.
INTELLECTUAL CAPITAL • Knowledge, intellectual property and experience that can be put to use to create wealth • Three major elements: • Structural Capital…e.g., documented Intellectual Assets, including IP • Human Capital…e.g., know-how and experience • Customer Capital…e.g., customer relationships and loyalty • IC Management (ICM), therefore, is Knowledge Management Copyright 2001 Ford Global Technologies Inc.
FORD’S STRATEGIC NEEDS • Become the World’s Leading Consumer Company that Provides Automotive Products and Services • Better ideas needed--which need protection • Protection--requires robust IP program • And, the value of IP…and need to extract it... getting increasingly recognized Copyright 2001 Ford Global Technologies Inc.
KEY FORD INITIATIVE--FGTI • New way of doing business to counter intense technological competition • Better way to protect, manage and leverage Ford’s technology and information…i.e., Intellectual Capital Management • Means to unlock the shareholder value inherent in Ford’s intellectual assets Copyright 2001 Ford Global Technologies Inc.
WHAT IS FGTI • An Intellectual Property Management Company • Wholly owned subsidiary of Ford Motor Company • “Spin-out” of Ford’s Office of the General Counsel IP Practice Group • Mission—protect and leverage Ford IP Copyright 2001 Ford Global Technologies Inc.
INCREASING SHAREHOLDER VALUE • FGTI leveraging IP to extract value: • New sources of royalty revenue • Building specialized patent clusters for cross-licensing and other purposes • Proactively policing Ford’s IP portfolio • Managing and resolving threats • Reducing the cost to Ford of acquiring new technologies • Using IA contributions to secure best deal for Ford Copyright 2001 Ford Global Technologies Inc.
IP HAS OTHER VALUABLE USES • Leverage extensive Ford technology, software, know-how and other Intellectual Capital to: • Secure favorable terms in JV arrangements • Cross-license to bring in new technologies at lower cost than licensing-in • Spin-off or take equity positions in new firms • Utilize trademarks for royalty revenue and brand enhancement Copyright 2001 Ford Global Technologies Inc.
TECHNOLOGY COMMERCIALIZATION STRATEGY Copyright 2001 Ford Global Technologies Inc.
EXAMPLES OF FORD EFFORTS • Intellectual Asset Management (FGTI) • Enterprise Knowledge Base • Best Practices Replication Process • Institutional Learning Initiative • Grade Banding • Supplier Technology Integration Process But much more needs to be done! Copyright 2001 Ford Global Technologies Inc.
THE PAYOFF--ICM • Supports Corporate Goal for improved Information Flow • Supports Growth by identifying new technology based business opportunities • Reduces/eliminates reinventing the wheel through better information sharing • Eliminates unproductive IP • Increases opportunities for Intellectual Asset commercialization Copyright 2001 Ford Global Technologies Inc.
FGTI & THE KM TASKFORCE • Still have much work to do within Ford: • Communicating what ICM is • Communicating the benefits of ICM • The Taskforce can help by developing: • A “non-jargon” message for senior managers • Metrics…”hard numbers…to show ICM benefits • Structured ways to implement ICM • The Taskforce also provides a forum for sharing of ideas among leading companies Copyright 2001 Ford Global Technologies Inc.