Intellectual property (IP) management: organizational processes and structures, and the role of IP donations

This paper examines intellectual property (IP) management in U. S. companies and addresses three questions: What are typical sources of IP? How do companies manage IP? What role do donations of IP play in IP management? We used in-depth interviews and an on-line survey to gather data. We found that firms develop their IP position from a wide variety of sources such as joint ventures, acquisitions, and consulting contracts, but internal development is still the primary source of IP. Organizationally, three structural archetypes of IP management were identified: a centralized structure, a purely decentralized IP structure and a compromise structure involving a divisional assignment where a multi-business unit or division committee oversees IP. IP donations clearly do not appear to be a major phenomenon at the present time. Our survey results suggest that tax benefits are an important driver and that recent tax law changes have diminished the incentives to donate IP. The uncertainty of tax benefits and the costs associated with IP valuation appear to be the main disincentives.