The value of an IP asset represents the potential future economic benefits to the IP owner or authorized user. In order to be able to sell, license or enter into any commercial arrangements based on IP, you need to be able to put a value on an IP asset. When it comes to IP management decision-making plays an important role. The ability to make effective decisions, to design comprehensible decision processes, and to understand and manage risk is crucial for IP managers. More about decision making and IP management can be learned in the Certified University Course on “IP Valuation (I)” at CEIPI.
The ability to make good decisions is the key to successful managerial performance. The managers of most profit-oriented firms are constantly required to take a wide range of important decisions in the areas of pricing, product choice, cost control, advertising, capital investments, dividend policy, personnel matters, etc. In IP management, for example, the development, execution, and implementation of strategies must be decided, portfolio decisions have to be made, infringement cases have to be detected and enforced, etc.
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Decision making is also a criterion to determine whether a person is in a management role. If they participate in decision-making, they are regarded as management staff.
In the words of George Terry: “If there is one universal mark of a manager, it is decision-making.”
In any business, whether large or small, conditions are never static but visibly dynamic. The old order is constantly giving way to something new, whether in terms of personnel or in unforeseen contingencies. Ever-changing conditions are becoming the rule. Such a situation calls for actions that involve decision-making.
Where IP managers are faced with various dimensions of ‘uncontrollable’ environment, VUCA and decision theory is a framework of logical and mathematical concepts designed to help managers in formulating rules that lead to the most advantageous course of action, based on a strategy under given circumstances. This theoretical and interdisciplinary approach helps to determine how decisions are made given unknown variables and an uncertain environment. VUCA is an acronym and stands for Volatile, Uncertain, Complex and Ambiguous, whereas decision theory brings together psychology, statistics, philosophy, and mathematics to analyze the decision-making process. These environmental conditions in many businesses have concrete consequences for management, especially for decision-making in IP management. To learn more about value oriented IP management in a VUCA world, visit this link.