Understanding the market for advanced IP management systems

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Understanding the market for advanced IP management


Intellectual property management (IPM) systems – sometimes generally referred to as docketing systems – are a critical enabler of today’s more sophisticated asset

management practices. The last 12 to 24 months have brought significant change to the IPM software market. Established vendors have released upgrades and introduced new products to the market.

There have also been a number of new entrants with innovative new solutions based on the latest web-based and SaaS (software as a service) oriented models.

Understanding the IPM software market, however, can be a daunting task.

Unlike other software categories, the IPM market is more fragmented and niche- oriented, with a broad range of options.

Many organisations struggle without clear, easily accessible and objective information about the market and solution providers, and the selection process is considered less successful.

With this as a backdrop, we recently published a comprehensive review of the IPM software market, including an evaluation of leading IPM software vendors. In this article we discuss our approach, and offer our insight and perspective on how organisations might conduct their own selection process.

We provide market background on the business context and need for IPM systems.

We then outline our evaluation methodology

The purchase of IP management system software is a significant investment. So how do you decide exactly what you need and who is best placed to meet your


By Ralph Schroeder

and the key areas we look for in leading solutions. We next discuss the IPM solution market, including those considered in our report. We conclude with a number of guiding principles we suggest organisations should consider in selecting and

implementing their own IPM solutions.

The need for advanced IPM systems The discipline of IPM is a well-accepted practice for innovation and brand-driven companies. While sometimes thought of as primarily a legal department responsibility, today’s IPM imperative is in fact cross- functional and an enterprise concern.

Licensing and IP transactions, from the patents and know-how perspective, as well as trademarks, brands and merchandising, are increasingly active areas of business. We also see R&D, product management and finance all interested in IPM. This expanded stakeholder contingent and more complex management processes are driving companies to evaluate their IPM operations, including supporting information technologies.

In understanding the role of technology in IPM, our research has found that the lack of information access is considered the most significant impediment to achieving strategic IPM goals. Without the ability to consolidate all relevant information, companies are limited in their opportunities to maximise the value of IP assets. The lack of information also causes operational and cost

inefficiencies, and increased legal and business risk. This is particularly problematic for companies whose value is significantly based on innovation and brand capital.

For many organisations, the legal IP docketing system is the primary source of intellectual property information. While these systems are adequate for tracking due dates and administrative information, they are inadequate in terms of the breadth or


IPM service provider evaluation criteria

Product features • Support for key solution components

• Perceived quality and refinement of features

• Differentiated feature(s)

Product usability • The look and feel, and adherence to common UI design

• Efficiency of navigation

Product maturity • Maturity and completeness of features

• Stability and robustness of application

• Enhancement roadmap and history Technology • Technology platform standards

• Flexibility

• Robustness, scalability

• Development methodology

Implementation • Implementation approach and credentials

• Implementation costs

• Hosting infrastructure (technology, security, process) Maintenance • Maintenance approach

• Maintenance costs Company viability • Market position/size

• Business model

• Organisation size

• Financial position

Market vision • Demonstrated thought leadership

• Industry participation

• Competitive differentiation

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depth of data that is captured and available for IPM analysis, decision making or strategic planning. Docketing systems are also not designed to support more open work environments that emphasise broader collaboration, workflow and automation.

To address these limitations, we find that companies have built their IP systems as collections of multiple commercial products and home-grown applications created to meet specific needs. While built out of necessity, over the long term this approach has created a number of issues related to data consistency, user access and training, and maintenance costs.

From a functional perspective, reporting and analysis is the single most cited area of weakness in IP system and tool capabilities.

Companies indicate that their commercial docketing systems provide poor or very poor reporting, and that data is often trapped within their systems.

More highly distributed work

environments are also changing the demands of IPM systems. Both internal staff and are outside counsel are spread across the world, requiring a concerted focus on work processes and information sharing. We find that email remains the primary form of collaboration for both internal workflow and work with outside counsel. Electronic document management systems that can manage the creation and archiving of work product are considered critical tools, and are increasingly prevalent in the collection of IPM systems. More advanced collaboration tools, such as meeting rooms and outside counsel system access, are considered future possibilities, but are not often at the forefront of technology priorities.

Finally, the use of electronic filing and information retrieval from patent and trademark offices (PTOs) is becoming a foundational requirement for IPM systems.

Companies are looking for seamless access and more automated flow of information between their inside IPM system and PTO systems. With lean staff resources, companies expect to minimise data entry and other low-value activities by

automating the docket entry. In meeting the demands of their customers, many PTOs have standardised their data and are offering interfaces. Current solutions, however, remain mostly stand alone and are not fully integrated into IPM workflows, thereby missing significant automation and efficiency potential.

Driven by increased business needs and opportunities for improvements, our research finds significant market activity, from both companies investigating IPM

systems and solution vendors offering new and enhanced products. Our research suggests that the combination of business needs driven by more advanced IPM goals and significantly improved technology will encourage above average market activity in the next 12 to 36 months.

Understanding the IPM software market In selecting IPM systems, companies are often challenged with understanding their solution options. Historically, the IPM market was largely defined by patent annuity service vendors, whose software products were referred to as docketing systems. However, beginning in approximately 2003, upgrades to established docketing systems and new entrants to the IPM software market began to redefine the landscape of IPM solution options. In the past two years, these improved IPM applications have sufficiently matured to the point that companies have real choices in how best to meet their more sophisticated IPM needs.

Recognising the opportunity for more capable and integrated systems, the IPM software vendors have begun offering solutions that address all – or at least most – of the core IPM processes in unified application platforms. Generally, the systems are offered in modules, allowing clients to tailor their implementations to fit their needs. These integrated IPM systems


Market position classification

Market participant Identified as providing capabilities in the solution area, with a focus on specific aspects of the solution or serving a

sub-section of the market; may also be a relative new entrant to the market or have not yet established a significant market position.

Market advanced Demonstrates strong capabilities in key solution components or has notable specialised capabilities.

Market innovator Demonstrates a number of leading and differentiated capabilities, with many class-leading characteristics;

demonstrates key product innovations and a clear market vision of next-generation technologies.

Market leader Demonstrates strength in both product functionality and overall business capabilities; meets and exceeds all key solution components; interface design is highly logical and easy to use; a strong record of client satisfaction; consistent flow of valuable enhancements; a highly regarded management team and organisation; financial stability.

address all asset categories, including inventions, patents, trade secrets, trademarks, copyrights, open source, domain names, conflicts/disputes, licences, agreements and other general matters.

An important market consideration is the combination of software and portfolio management related services. The more established vendors continue to offer a close tie-in between their software and patent/trademark annuity services. Many are also expanding their service offerings to include broader portfolio management or administrative (eg, docketing) services that potentially work in conjunction with the IPM system. On the other hand, dedicated or pure play software vendors do not directly provide annuity or other services, and claim superior product features and quality. Legitimate questions exist as to the merits of each business model and their value to customers.

The IPM software market is challenging.

While the established docketing vendors have shown recent software development credibility, in the past they have

demonstrated inconsistent software business acumen, from both a development and implementation perspective. It remains to be seen whether recent advances represent true, long-term positive change.

For new entrants with pure play software business models, legitimate questions likewise exist as to their long-term viability, particularly in highly competitive market conditions. System cost, including both initial startup and continuing operations, remains an important consideration for clients, as new technologies and advanced features come with a higher price tag than the market has historically paid. In driving

for the best function-cost value, purchasers should scrutinise not only the price, but also the vendor’s business viability.

In looking towards the future, we see continued development of the market towards increasingly integrated IPM platforms. This will include closer integration with enterprise content management, business intelligence

analytics, product management systems and electronic billing. From a market

consolidation perspective, while there is certainly some opportunity and likely activity, we do not see major changes among the leading providers unless caused by broader company strategies not driven by IPM software per se. We expect that the market will continue to be more niche- oriented and fragmented for the near to mid-term (next three years.)

We do, however, see more significant change in the mid to longer-term horizon (three to five years). While in the near term IPM systems will remain separate from general legal, we predict that IPM

capabilities will become part of the broader legal department solution set, particularly as enterprise legal management (ELM) platforms become established and seek broader solution footprints. This is likely to come from existing matter management vendors currently providing solutions to the broader legal department. We would also not be surprised to see a move into the law department by one or more of the

enterprise application vendors (eg, SAP, Oracle or Microsoft) offering IP-specific modules. While perhaps not initially including deeper IPM functionality (particularly docketing), the emerging ELM platforms will both easily integrate to legacy IPM systems and over time introduce more highly sophisticated capabilities. The investment resources by the large enterprise application providers will be a significant competitive challenge to the comparatively much smaller current vendors.

Research and evaluation process In looking at the IPM software market, our research process uses both primary and secondary sources. These include publicly available information, as well as proprietary research developed through a variety of sources including legal departments, software vendors and industry thought leaders. These resources are used both to develop our perspectives on the market and in evaluating vendors.

The first thing to do is to create a thorough list of all vendors in the solution area. The initial vendor pool is constructed


www.iam-magazine.com 14Intellectual Asset Management September/October 2010

from market research, including our proprietary vendor database, internet-based research, industry trade surveys and our clients. All identified vendors are initially screened for inclusion based on their alignment with our project definition and report objectives.

For included vendors, we pursue additional detailed information both directly from the vendor and from secondary sources. This includes publicly available marketing materials, presentations and other information. We also offer vendors an opportunity to provide us with additional information about their company, products and services. Vendors provide information through written questionnaires and/or through a vendor briefing process. Briefings often include a product demonstration of specific features and capabilities. To maintain objectivity, vendors do not directly contribute to their evaluations or the evaluations of their peers;

nor do vendors receive a copy of the report or its findings.

Our evaluation process, VendorView, is based on market expectations and the vendor’s relative capabilities in the overall peer group of solutions. It results in a rating that considers both the product’s and vendor’s capabilities in eight key areas, using a 10-point scale in each category.

For specific product functionality, the evaluation is based on a standard set of features and capabilities called key solution components (KSCs). We develop our KSCs based on best practice features and capabilities expected from leading software products. The KSCs provide a consistent set of functional criteria by which we can evaluate and compare vendors. The KSCs also provide a starting point for clients to develop their own requirements and

selection criteria.

Based on our evaluation, we assign each vendor to a market position classification.

These categories define a relative position of vendors in the solution market.

The IPM solution landscape Our initial search identified over 40 solutions with some relevance to intellectual property. These included systems with a varied range of claimed capabilities related to IPM.

Ultimately, we focused our analysis on 26 products considered to provide tools related to IPM operations and

administration (as opposed to searching, reporting or analytics). Of these, 17 were considered to meet only basic IPM criteria or to be focused on specific aspects of IPM.

These products were categorised as market participants. As such, these systems may be considered credible options for special applications, rather than integrated, enterprise IPM – for example, as general docketing systems, trademark specific systems or portfolio management systems.

Nine products were considered to meet most or all IPM criteria, and were

categorised as advanced IPM solutions. For each of our nine advanced IPM solutions, we conducted a detailed assessment of both the company and product. Our evaluation was based on market expectations and the vendor’s relative capabilities in the overall peer group of advanced IPM solutions.

These advanced solutions were primarily distinguished from market participant solutions in that they provide a broader set of functions and capabilities closely aligned with IPM best practices. As docketing remains a core capability, we find that our advanced IPM solutions all provide rule-based auto-docketing, with country

Company Product(s)

Market participant vendors

Computer Packages Inc CPI

Dennemeyer Sarl DIAMS-iQ

First to File Inc EFR

GSI Office Management GmbH WINPAT

IPOnline Ltd WebTMS

Knowledge Sharing Systems Inc KSS TechTracS; KITS

Knowligent Inc ipPortfolio5

Mind Matters Inc Innovator

OPSolutions Inc Pattsy; Pattsy WAVE

Patev Web Services GmbH IPwebS

Patrix AB Patricia

Questel Inc World Suite; World Mark; Edital

RevaWare Inc Reva Trademark


rules. Where these systems are

differentiated is in the extensive additional capabilities in other aspects of the IPM process; for example, invention management, portfolio reporting and analytics, and agreements management are high-value areas which differentiate these systems from market participants.

From a geographic perspective, all of our nine advanced solutions have international sales and operations reach, although the US and European markets predominate, with significantly less Asian activity as a percentage of clients. There are three companies based in the US and one each based in the UK, Sweden and Austria. All but one vendor now has some Indian or offshore-based product development and implementation.

Guiding principles for selecting and implementing IPM systems

The review and selection of the right IPM system can be a complex and time- consuming task. Many IP organisations must first invest significant time in understanding their needs, requiring significant investment of time and resources. Companies must then sift through vendor-related information and determine their best solution fit. This significant investment is all prior to the actual implementation and roll-out, which is always time consuming, and requires staff resources in addition to their everyday work responsibilities. Notwithstanding these costs, the improvement opportunity and return on investment in a world-class IPM system – if done successfully – can pay for itself many times over and can be a truly revolutionary change for the organisation.

Potential purchasers should be pragmatic and realistic about the time, effort and budget required. Vendor estimates and plans, although presumably well-intentioned, should be scrutinised and challenged to ensure proper management expectations.

In evaluating vendors, the product’s features and capabilities are important, but

careful consideration of the vendor company’s strengths is also important.

Purchasers should use a comprehensive set of criteria to determine their best vendor- partner fit. These criteria should include the vendor’s existing features, future product roadmap, company stability, ease of deployment and user adoption success.

To assist our clients in their IPM system selection process, we have

developed the following guiding principles.

Start with a well-defined set of user needs and requirements

In reviewing the IPM market, use the key solution components. These should be considered a minimum set of capabilities and a starting point for developing a specific list. Many IPM selection projects lack the understanding of business processes and requirements, in sufficient detail, that are required for a successful vendor selection.

Understand the vendor’s licensing model and pricing

Purchasing software involves a number of important interrelated considerations.

Licence type, usage scope, maintenance and support, installation location and licence fee calculation are all critical dimensions of the software purchase. There are a range of practices among vendors in the IPM software market. While no model is inherently good or bad, licensee-purchasers are well advised to understand their vendor’s approach and how this might have an impact on their business objectives.

Closely scrutinise vendor references The IPM market is covered by many vendors. Company size (large or small) and market reputation (good or bad) may be considerations, but should not replace direct client references. References will provide added perspective and should allow for purchasers to ask questions and gain a better understanding of experiences in working with the vendor.

Company Product(s)

Advanced IPM vendors

Anaqua Inc Enterprise; Express

CPA Global Ltd FoundationIP; Memotech

Innovation Asset Group Inc Decipher

Ipendo AB Ipendo Corporate

Lecorpio Inc Legal Resource Manager

Thomson Reuters Inc IPManager

Unycom IPMS


Intellectual Asset Management September/October 2010 17 www.iam-magazine.com

Ralph Schroeder is managing director of Hyperion Research, a unit of Hyperion Global Partners Inc

www.hgpresearch.com ralph@hgpresearch.com

Review the vendor’s business plan and financial condition

The IPM market is accurately considered a niche area. Unlike other technology areas – such as ERP, CRM and financial systems, which are dominated by the likes of Microsoft, Oracle and SAP – most IPM market vendors are comparatively small.

The products operated within large companies may nonetheless be businesses of relatively comparable size to standalone IPM vendors. Purchasers should review financial plans concerning a provider’s IPM software business specifically, including revenue and R&D investment.

Understand product development approach and history

While current features are important, your vendor relationship will be long term.

Purchasers should consider the roadmap for new features and the vendor’s history of new releases and on-time record. They should also understand the process for defining enhancements and how they are made available. Importantly, purchasers

should understand whether new

enhancements are included as part of their licence or support.

Evaluate implementation capabilities and options

The success of a new system is determined by the success of the implementation and user adoption. While features drive product selection, the vendor’s

demonstrated experience and success in implementation is a critical consideration.

This includes set-up, infrastructure, configuration, data conversion and training.

Purchasers should be open to considering in-house implementation (it may be a red flag if a vendor will not allow a purchaser to use its internal resources for

implementation) or the use of an external implementation consultant. No other category of technology is more manifest in its configuration of the processes that drive it. It is critical that implementation activities focus on the use of the system at least as much as on the installation of the system.

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