NATO Science Program and Cooperation Partners
ADVANCE RESEARCH WORKSHOP
Partnership and coordination "East-West" in the sphere of intellectual property utilization and innovative processes development
Taskent, Uzbekistan - September 8-12, 1997
Abstract. The constitution, or reformulation,
or restructuring of a private professional office dealing with industrial
property, on behalf of third parties, may have different configurations
and structures. It may also give priority to services which, even
if they are apparently similar, may in fact be very different.
There are many factors which come into play; some external, some internal, and a policy of small but continuous steps is normally the one which, in the course of time, gives the most satisfactory and the most intrinsically stable results.
Friuli Venezia-Giulia is a small region in the far
North East of Italy; its economic (but not political) capital is
Udine. It is bordered by Austria, and now by Slovenia.
The region has a population of about 1.3 million people with a variety of ethnic roots; the most ancient of these are the Carnians (Celtic stock) and the Friulians.
The region was the route for many invasions: many northern peoples crossed through and then spread into the Po valley.
Moreover, in the course of the centuries, it was dominated by various masters and in the second half of the 16th century it was in fact repopulated by more than 40,000 people of Venetian, German and Slav roots.
To this must be added the immigration which, after the Second World War, brought Istrians and Dalmatians of Venetian or Italian roots to the region.
This situation has led to the presence in the region of large enclaves of Slav peoples and people with family relations on the other side of the border; however, there has always been a dialogue between the region and the former Yugoslavia, and not only there. This dialogue was at times open and at times hidden, according to the politics of the moment, but was always continuous and has always existed.
And so, it was almost a natural consequence, several years ago when the new political situation over the border (and not only there) began to be defined, that we were contacted to supply information and advice by some of those who were beginning, or were intending to begin, to start up as consultants in industrial property.
The idea of the profession, that is to say, the ideology which decided those people to exercise this profession, reflected the accumulated history of the last nearly 50 years, and the desire to redeem the past rapidly, almost by trying to obliterate it. If on the one hand the instruments at their disposal were perfectly equal to the ones we use, on the other hand the cultural approach was very different and not coherent with what we believe to be the natural evolution of things. In our opinion it is precisely the cultural approach which is the fundamental element in setting up an autonomous professional activity of this kind, which involves and requires a long time and cannot be done quickly; just as, in the same way, it is inadmissible and impossible for a stable industrial and/or commercial culture, as we conceive it in our modern world, to spread rapidly.
Years ago, when the monolithic rigidity of the so-called "Eastern bloc" was beginning to crumble, we began an interesting working relationship with some members of one of such offices. These offices were divided into several operating units, and in the various countries of "Realsozialismus" their function was to interface with the Central Office which dealt with Industrial Property.
We had therefore an old acquaintance coming from close contacts, designed to deal with opposing interests and which had developed since the beginning of the 70s, with this office and with two of its operating units.
These people were professionally very well prepared, with adequate instruments, but they were aware that their approach was marred by too many years of bureaucratic activity and by an industrial situation which until then had been too protected to be competitive.
On various occasions we discussed methods of approach and possibilities for development with these people, and we supplied them with the suggestions they requested; moreover, we not only provided them with selected addresses of foreign colleagues, but we also introduced them personally where it was necessary, so as to facilitate and improve the contacts.
The contribution we made was facilitated by the industrial history of the region where we have our main office: in its recent history, a large part of our local industry was stimulated and protected, in the hope that it would take root and expand, by public contributions obtained to deal with the problems caused by a destructive earthquake. Now that public finances are no longer available, practically only those companies which had not benefited from them still remain, at least stably; the others have either changed hands or have disappeared. We were careful witnesses of this whole story, and sceptical of the results which, it was hoped, would be obtained, since we did not see a culture which was suitable to achieve what the political forces hoped for.
This experience taught us that it is not so much the professional preparation - although this of course is important and must be adequate - so much as the ideology and the expectations accompanying the professional situation, whether it be new or reformulated, which must be correctly created.
Indeed, those who venture down this road must know that it is unthinkable to transform, let alone to create, an industrial/commercial fabric of the bureaucratic-oligarchic type in a short time, and must also have a clear idea, as far as possible, of the reasonable scenario which one might hope to see after 15-20 years, which is a normal period for evaluating the success or lack of success of an initiative.
It is necessary to have this vision, which must be scrutinised and revised with time, in order to structure, programme and manage everything at all times, not only according to evolutions taking place, which if they are too rapid may need to be braked hard or even a quick return to the past, but also keeping in mind a reasonable scenario which will come about with time as it evolves, given the philosophy of life and development which is still dominant and apparently unbeatable.
The quick and not necessarily exhaustive comments which follow reflect these experiences and the convictions which, as a result, we have reached.
It is not possible to create a new reality, nor to pass from one scenario to another simply because there is the political will to do so, but when most of the leading and supporting actors have substantially accepted the new situation. This happens in an intrinsic and stable manner over a long period of time, and the time taken will be longer when the new situation is very different from the old situation and the dominant culture.
Sudden accelerations, however induced, lead to damage, disasters and white elephants.
In the same way, excessive expectations cause disappointment and errors of judgement.
2. External factors
- 2.1 Structure of the market
The development of a professional studio dealing with industrial property is closely connected with the industrial and/or commercial development of the area where the studio operates. There is no opportunity for a different development, whether the studio gives precedence to work arriving from abroad or work arriving from the home market.
This kind of professional studio has typical staff functions and therefore cannot have its own operational autonomy if it is not correlated to the industrial/commercial autonomy which exists in the area it serves.
The type and characteristics of the market to which the professional studio is directed, or to which it intends to be directed, affects the structure of the studio itself, and the professional resources which the studio must typically have at its disposal.
The studio which gives priority to work from abroad will prevalently need to use resources which will allow it to obtain, at a reasonable cost, the translation of the documents in the official language of the country and also of communications sent out, in at least a widely used foreign language, usually English.
The quality and cost of the translation into the widely used language are a qualifying factor for those who use the services of the studio and who do not always come into direct and personal contact with the studio and its capacity and potential.
It should also be remembered that any direct and personal contact, on most occasions, is necessarily superficial and gives rise to judgements which are highly subjective and based on impressions and feelings.
These judgements may also be shown to be wrong when a passive action of defence, or an active action of attack becomes necessary and when other professional and non-professional capacities must be deployed so as to obtain the best possible result.
In addition, this contact is usually made by other professionals resident elsewhere or by officials in the case of multinationals which have internal structures to coordinate and control their collection of patents, all of which characterises these contacts mainly by the expectations of the potential client.
For this reason, the professional studio which wants to give priority to the foreign client must take great care of its image and create an extensive network of personal contacts which are developed by taking part in international meetings and high quality presentations, rather than by sending brochures, communications or other.
Setting up the activity of the studio in this way simplifies management and requires an average professional and quality level lower than that required by those who give priority to the home client; moreover, it will make it possible to have an income on a repeated basis.
On the contrary, the professional studio which decides to give priority to the home market must have a great deal of patience and willingness, not to mention greater and higher quality inner resources than those which the home market requires from him at that time, if he intends to work at a high level.
Assuming it is possible, or reasonable, to make estimates in these matters, one might hypothesise that the abilities which, at a particular moment, the studio creates in the territory should be those which the territory is able to understand and evaluate in the future, not before five/six years, and for some places even ten years or more; this is the delay which should be calculated for an invention (for models and trade marks the average typical delays are different) in the event that there is an active or passive court case when the contents are particularly competitive.
Another feature which the decision to give priority to the home market involves is that there is a slower, more limited development in terms of staff and perhaps of income, compared with the studio which chooses the foreign client. This is because development is closely linked to an intrinsic and natural development (therefore not a forced development with plants or structures imposed politically or by multinational companies which leave little or nothing on the territory), a development which, rather than technical or technological (in the commercial sense too) requires an extensive cultural evolution, accepted by at least a large proportion of the population.
An internal market which gives priority to commercial activities needs high quality resources in the field of trade marks, falsification and unfair competition; if the commercial activity deals with foreign countries, then it needs an extensive network of correspondents specialising in trade marks and connected activities; this may also be obtained by using the services of another studio which has the necessary facilities and by stipulating an agreement with the said studio. In this way it is possible to offer immediately a high quality service without running the risks connected with looking for correspondents or those due to inexperience in dealing with specific problems.
A market which is looking for or requires technology which is not available in that market needs from the profesional studio a structure with means suitable to assist in evaluating the technology on offer and the connections (not only technical) which inserting the said technology involves. It also requires a knowledge of the contractual mechanisms and the techniques used to mask and avoid contractual obligations which may be found when it is a question of acquiring technology and know-how. In these cases, collaboration with studios operating in areas where this technology is already present may sometimes prove to be a decisive weapon, in that a deeper and more extensive evaluation of the proposals can be made, both in technological and contractual terms.
It goes without saying that in this case the term "technology" has a very wide meaning, and on different occasions includes technical, technological and/or commercial components.
It must then be pointed out how the so-called "private inventor", who is very active especially in markets which are technologically young and rudimentary, may claim up to 30 to 35 percent of proposed new inventions. If on the one hand this kind of inventor is certainly a client who does not cause great problems, does not require a sophisticated type of service and is ready to pay a little more than entrepreneurs, on the other hand he rarely brings something which is really worth protecting; this causes the professional human problems which are not inconsiderable and not easy to solve if he has a minimum of "common respect" for his fellow man.
- 2.2 Public Administration
The services which the Public Administration is able to offer a professional studio dealing with industrial law (and consequently all commercial and production activities) have an enormous influence on the characteristics of the structure which the said studio must possess. (In the following discourse, the Public Administration which manages industrial property inside the country and for the State will be referred to as "State Organisation").
One need only think of the promotional activities and the sources of documentation and information which the said Organisation makes available, or does not make available.
Certainly today we have at our disposal data banks which may be miles away, yet are quite accurate, can be questioned quite easily, are quite up-to-date and easily accessed, but the question one immediately asks is: how much use are they? how secure are they? how complete is the data they supply? what help do they give in solving the technical and technological problems which industry has to deal with?
If we think of the relative novelty of these data banks, we understand how little use they actually are, especially for technologies which naturally gain credit in industrial areas which have to be developed and in those which are at the beginning of their development. In this case then, an extensive, organised collection of documents which is easily accessible and available is an extremely important factor not only for the activity of a professional studio but also and above all for a proper industrial development with no waste of resources and with a wide range of options, new solutions and provocations available for planners and study and research groups.
The better the users know how to question it and understand it, the more useful this documentation will be.
Otherwise, it will be the professional studio which on the one hand will have to look for reliable external sources to turn to and on the other hand will have to take charge of deciphering the documents.
The external sources will have to have characteristics coherent with the requirements of speed and cost, and the studio will have to create a whole series of corollary activities, but not too many, which are needed by a company which wants to find a competitive product for itself, not only in economic terms, and which wants to grow with the product, putting it onto the market aggressively, improving and defending its own position also because of the low production costs which are possible in such areas.
Moreover, the studio will have to be equipped to keep a copy of the typical documentation which will become available as time goes by in order to improve its services. However, this will bring problems of storage and archives, which with time can become complex and which in any case pose problems of planning, start-up, management and cost.
And there are not only inventions, there are also trade marks and models.
Therefore, if a private studio has to equip itself to answer the clients' requirements completely, supplying also the so-called "warning" services which are so useful for all, but particularly for young companies, and if this studio does not find in the State Organisation a valid contribution, then it must use substantial resources of its own, and these may not always be available.
This is only a brief indication of the help which the State Organisation can give (but there are also many other services which it can provide) in order to encourage the activity of a professional studio and facilitate industrial or commercial development.
Such an Organisation, especially in developing countries, but not only there, should therefore be responsible on the one hand for spreading the culture of innovation, and on the other hand for teaching the basic concepts of industrial law, and the reading and use of technical documentation in general and also patent documentation.
- 2.3 Competition
One factor which affects the structure and activity of a professional studio, improving its professional standards and reducing costs for the users, is an active competition.
Everyone knows what benefits are produced in every field by healthy, high class competition; in a similar way, even in the professional field, whatever it may be, competition should always be welcomed, providing that supply does not outstrip demand.
It goes without saying that the State Organisation, without prevaricating and without adopting a centralising policy, must help and stimulate the rise and development of competition proportionate to the realities of the market; the development of the sector and its preparedness depend on this and, consequently, so do the development and reinforcement of the competitive ability of the companies which use the services of industrial property and those connected to it and deriving from it.
- 2.4 Geographical position
The geographical position of the studio inside the country also affects the structure and professional qualities of the studio; for this reason it is better to site the office in the main industrial areas, so that, by specialising in the technical and technological abilities of that industrial area, the studio will make a positive contribution to its development.
If, on the other hand, the studio is situated near the offices of the State Organisation concerned, it will give precedence to administrative activities within this Organisation and also to the activities of foreign clients - this is because it is easier to make contacts and do the work, which normally leads to a lowering of professional standards.
If the studio is divided into different parts, that is to say, with distant branch offices referring to a central office for mutual activities, this also causes a lowering of standards, at least in the branch offices. Normally, in areas which are developing, such situations are not successfully or naturally achieved.
Those people working in the branch offices are not normally able to understand the entirety of the problems connected with their own work and consequently this work is not normally as good as it could be for that particular situation or requirement of the client.
Moreover, not even the central office, which normally manages relations with abroad, is able to supply a high class service coherent with the client's needs when the client has been dealt with by the branch office, since the head office does not know the client and does not understand the natural requirements which occur on each occasion.
3. Internal factors
- 3.1 Internal professional resources
Internal professional resources, as is obvious from the previous comments, depend on a plurality of factors, not least of which is the type of client and his technical, technological and commercial level.
A professional studio which wants to position itself actively and positively in the territory must have its own professional resources which cover not only all aspects of industrial property, but also, sometimes, those connected and derivative resources, in such a way that it can position itself constructively alongside the industry, possibly from the moment when the product or market is first created.
It is evident that certain resources, in certain territorial or market situations, may not always be profitable, or they may not always be totally used; however, it is still better to have them, if the studio wishes to stimulate industrial and commercial activity, especially when this activity is typified by very small, small or average units.
Moreover, it must be remembered that, especially in areas which are still searching for their own technical and/or commercial identity, the internal resources of the studio will have to pay particular attention to the evolution of technology and/or of the commercial activities which are typical of the area served, in order to supply ideas, advice and inspiration.
Additionally, precisely because of the typical problems of the clients, at least in the field of inventions, a professional studio operating in the field of industrial property should adopt this rule: one type of product/technology, one client. This rule is essential both when dealing with home clients, and also when foreign clients are not simply supplied with translations and administrative management.
Unfortunately, in developing areas this is not always possible, also for reasons of economic balance and/or the variety of demand; in this case the professional studio will find considerable problems of confidentiality and secrecy which are not at all easy to deal with.
- 3.2 Promotional activity
A professional studio can market itself by cloaking itself in mystery and raining down its services from on high; otherwise, by promoting itself actively and provocatively in order to increase its knowledge of the area served and understand the real requirements of its potential client and help him to understand too.
In the first case the studio will benefit from the advantages that the ignorance (in the sense of not knowing, and not being able to judge and decide) of the potential client will bring, and also the respect that can induce; these benefits can be very considerable and can moreover cover up any mistakes made, or even mask the fact that the professional studio has few or no professional qualities.
In the second case, which is desirable in developing areas particularly when these areas are more backward, the promotional and informative activity helps to continually improve the potential client's ability to use, interpret and judge everything that is connected with industrial property. The promotional activity has its effect on the professional studio too, since it is obliged to continually improve its own preparation in a continuous cycle of improvement. This is because the clients, who are able to understand their own requirements better and to evaluate the professional response better, will gradually put forward more and more sophisticated problems and in any case will require correctly formulated answers.
A professional studio which takes this road can do a great deal for the commercial and industrial milieu where it operates; it can do this by means of publications, articles in newspapers and journals, conferences, communications, and above all extensive and thorough explanations.
Other helpful factors may be connected with research and the perfection of collective trade marks of quality and/or origin which become a guarantee for the foreign purchaser of products marked in this way.
- 3.3 Organisational structure
It has been recognised for some time now that it is not opportune for or in the interest of industries to organise internal services which manage autonomously, and not only coordinate, industrial property. These internal structures are not appropriate due to problems of quality and of cost (normally the ratio is 1.8:2.3 to one).On the contrary, there is an ever more urgent need for internal services to correctly file the Company data and extensive technical documentation.
In order to be efficient with regard to the client and to its own institutional purposes, the organisational structure must have its own critical volume of staff, below which it cannot carry out any consultancy activity correctly.
This critical volume also depends on how the consultancy, often supplied over the telephone or in quick explanatory meetings, is organised and managed; for a positive relationship with the client, it is essential to have a rapid consultancy which replies to the client punctually and quickly, even if it poses problems of responsibility and correct interpretation on the part of the client.
From the critical volume and the relative ratio of exploitation between hours charged and hours present, compared with those items of the profit and loss account which are ascribed to the management per se, we obtain the cost per hour; no service can be charged less than this figure.
A professional studio operating in the field of industrial property should have an organisational structure which only needs external support to deal with its own matters of taxation and for legal matters. This is a question of confidentiality and to enable the services to be delivered completely and quickly.
If it wants to have a profit and loss account with a breakeven point which allows it to face the competition confidently and at the same time spread over the territory, such a kind of structure should exploit the hours of presence by no less than 47 to 50 percent.
Many professional studios combine legal activities with their work with patent titles and trade marks. Although this is economically rewarding, it does lower the quality of the legal service which necessarily is limited from a cultural point of view by the input and by the typical cases of the studio. In developing areas, or areas where there is little economic development, this lowering of quality is not perceived as a great problem, both because of the relative simplicity of the problems posed by industry or commerce, and also because of a limited number of cases to refer to.
With time however, as industry develops and as its legal requirements become more and more sophisticated, it is preferable that the two activities should be separate and become autonomous: this is also to avoid conflicts of interest.
An important component of a studio operating with a proper ratio of price to service is the management of costs which, due to their heterogeneous nature, complexity and quantity (typical factors in this kind of activity), must be charged on each separate occasion and for each individual case; it is evident that, as a consequence, the invoicing relating to each case is complex and may bring surprises if not managed properly.
If then this cost management (cost accounting) is connected to the profit and loss account and other management factors, an extensive and complex mass of information starts to involve all the cost centres and becomes available for a cost management which is economically rewarding and suitable to create, in the medium term, a forecast similar to the new situation which is forming up.
Another important component is the management of the due registers; this is apparently an easy job, but in practice it is difficult and complex. It affects the clients' interests directly and deeply over a period of time, and therefore also the interests of the studio.
This service not only supplies clients with a professionally useful back-up, it also allows the studio to maintain contacts with the clients and guarantees a certain stable income from an operational continuity.
A professional studio operating in the field of
industrial property, just as any other professional studio with
a certain number of employees, must be managed, and therefore seen
and located, like any other production unit, irrespective of the
number of employees concerned.
The studio's ability to generate income, its ability to last in time, its ability to expand and to contribute to expansion, all depend on the strategic choices made and on the ideology which has generated such choices; and all this has to be closely linked to the reality in which the studio is located.
To this we must add that, if it is intended for home clients and organised to supply those clients with a continuous and extensive cultural support, this kind of professional studio can help its clients grow in a dynamic context and with a high competitive ability.
In addition, a professional studio in a developing country, which wants to give its potential home clients a high class and professionally advanced service, must preferably establish stable relationships of trust with other areas, keeping in mind the technological gap which exists between the two countries, and which should not be so great that it creates misunderstandings or difficulties in dialogue.
Such a working relationship is positive for the growth and professional stability of the studio, and moreover it allows the studio to supply its own territory with information, considerations, evaluations and, more generally speaking, high level assistance which at the same time is compatible with the level of knowledge and with the proper management ability of the new situation, as is culturally available from the reality which the said studio wants to address.
If the new situation is too sophisticated and developed too quickly, no matter how new it is, it may be more traumatic and harmful than an old situation which is deeply rooted and intrinsically experienced; a great deal of damage has been done, and many cathedrals built in the desert, by people who have not understood that a gradual progress, without intrinsically traumatic thrusts, a progress made in a provocative and stimulating manner, is always more rewarding, also in terms of stability and the consistency of the results, than a forced progress which is beyond the natural cultural abilities of the majority of the group.