Enhancing SME Competitiveness through IP Asset Management

1. WIPO-ARIPO Sub-Regional Training of Trainers Program on Effective Intellectual Property Asset Management by Small and Medium Sized Enterprises (SMEs) How ARIPO Enhances Business Competitiveness in the Region, Harare, Zimbabwe, November 26 to 28, 2014 C.J.Kiige, Director, Industrial Property

2. Outline • Status & Challenges of SMEs/Businesses in LDCs; • Use of IP by SMEs / Businesses; • Key measures of Success in Using IP in Businesses; • How ARIPO Encourages Businesses in the Region; • Is IP directly Proportional to Development ?

3. Status of SMEs/Businesses in LDCs Importance of SMEs/Businesses in LDCs • Employment Creation, Wealth Creation, Industrialization, Value addition, Contributes to 90% of the GDP Characteristics of SMEs products in LDCs: • Low quality, Less attractive in appearance; • Low efficiency and effectiveness; • Lack of standardization of products; • Products that are not protected and have no IP Rights including trademarks; • Nevertheless SMEs in LDCs are known to be very innovative. However, today’s SMEs can be tomorrow's multinational companies

4. . Challenges facing Businesses in LDCs • Finance • Market • Skills • Technological:-equipment, product, process Difficulty in accessing the Markets for SMEs Products due to Lack of Competitiveness SMEs in LDCs are innovative and most of the technical needs they provide by themselves through trials and errors 4

5. Few innovations break-through - pioneering innovations: new industries; new business; new markets, etc. Most innovations are: incremental development of technology improved quality; better performance; higher productivity; more customer satisfaction; reduced costs, etc. Creation of Innovations by Businesses 5

6. Functions of IP systems Source of Information Function • “Full disclosure” requirement • Very important for the continuous development of technology; • Each publication of an IP Application is the base for new developments by other innovations; • Acts as a catalyst for the commercialization of IP Assets (inventions) and their transfer to productive use; • Majority of IP Rights are improvements to existing worked innovations; • These contribute to economic and social development;. • Most IP Rights are published before registration or rejection- Therefore will be in public domain for exploitation.

7. SMEs must Identify IP Rights in the Public Domain • Most IP Rights have limited duration of protection; • Most IP Rights are Territorial; • This is very important to Africa • where the informal sector and small and medium-sized enterprises are considered major engines for industrial transformation! • For Various reasons Most IP Rights are not Protected in Africa

8. How SMEs can Use IP Information for Business Solutions & Success • SMEs & Business institutions Undertake research for - New Products, process, equipment or improvements; • Some Challenges facing SMEs & Researchers in Africa: • Belief that every technical problem requires R&D; • Limited information on alternative solutions; • Limited Funding, etc. • Duplication& Copies of Business Activities;

9. How SMEs Can Use IP to Avoid Duplication • Undertake an IP search to establish the state-of the-art for a new Business venture: • To ascertain the Profitability of venture ; • To ascertain possibility Reverse Engineering; • IP alerts the Entrepreneur of previous ventures, Research or publications in the area; • The Need to exchange of data with other SMEs & Research Institutions; • SMEs, Universities and R&D to avoid spending money to carry out ventures which are competitive!

10. The Value of Reverse Engineering (RE) • RE is a process of dismantling an existing technology with a view to learn and copy in order to produce similar or better technology • Though cumbersome and time consuming. This is the best method of using IP in Business & R&D; • Most Businesses and Research Institutions use RE in Developing New & Appropriate Technologies; • It is based on patent information; • Since most technologies are not protected in Africa, use of RE should be encouraged;

11. How to Use IP during Development and Marketing of New Products • IP Searches are important in Initiating, Developing and Marketing New Products or Processes particularly in: • Identifying companies which can be end-users of a particular product or equipment; • Analyzing IP holdings of specific applicants within a narrow research area • Can be used in identifying major players in the field, whose services could be sought;

12. Summery of How Use IP to identify an Appropriate Business Strategy IDENTIFYING & MONITORING COMPETITORS IDENTIFYING TECHNOLOGIES IN PUBLIC DOMAIN SOLUTIONS TO TECHNICAL PROBLEMS IP INFORMATION IDENTIFYING ALTERNATIVE TECHNOLOGIES ESTABLISHING STRATEGIC ALLIANCE OBTAINING ADDITIONAL REVENUE

13. How ARIPO supports the Use of IP by SMEs & Business BUSINESS STRATEGY Grouping IP DATA according to area of interest ARIPO INTELLIGENCE (Strategic Decision Making) RESEARCH STRATEGY Analyzing data and deriving useful INFORMATION POLICY STRATEGY (Institutional/ National)

14. How ARIPO Encourages Businesses in the Region • Facilitating National, Regional Protection of IP Uniformly; • Creating an IP Culture & Integrating it in National & Regional Economic Development Programmes & Policies for the Benefit of the Member States; • Assisting SMEs, R&D and other Institutions in using Information contained IP Documents; • Capacity Building & Development of Human Resources in IP; • Facilitating & Encouraging IP Awareness Programs; • Disseminating Information Related to IP; • Encouraging IP Rights Protection and Enforcement, • Helping in the Procurement of IPR licenses & Assignments; • Using IP Assets are collateral,etc.

15. How ARIPO encourages Governments to fund Innovation, SMEs & Businesses in General • Providing Region IP titles to inventors/innovators on behalf of Governments of its member states; • Government loans, Grants, tax incentives could be based on IP titles • Providing Patent Information to inventors/Businesses; • Free Patent Information service; • IP units at Universities & Research Institutions ; • Harmonization of IP laws in the Region; • Capacity Building in all matters relating to IP; • Supporting member states & their Institutions in the drafting of national and Institutional IP & Innovation Policies; • Participating in National trade & Inventors’ Fairs whereby ARIPO medals are given to the best Innovators/Inventors; etc.

16. Key Measures of Success in Using IP in Business • Increasing the Capacity to Create Intellectual Property; • Encouraging the Commercialization & Utilization of IP in Reverse Engineering and Innovation; • Development of a Legal System for Intellectual Property ; • Improving Appropriate Intellectual Property Laws/Policies • Strengthening the Administration of Intellectual Property; • Developing Intermediary Services for IP; • Developing Intellectual Property Human Resources; • Promoting the Cultivation of an Intellectual Property Culture; • Expanding International Exchanges and Cooperation in Intellectual Property;

17. Intellectual Property and Development: Any relevance? • Is IP Directly Proportional to Development?! • Does IP also provide Incentives to Creators & Innovators?; • Does IP encourage sharing of knowledge in the Public Domain to Inspire Reverse Engineering & Secondary or novel creations/innovations • Pre Industrialization of Asian Tigers like:Japan, Korea and China could be the best examples; • Tigers took advantage of weak IP regimes to Reverse Engineer, copy technology and invest in local, homegrown manufacturing and technology base; • Why are we failing to do the same?!

18. Knowledge Economy in 2010 Compared to 2000 >2000:Intangible Assets: 20% <2010:tangible Assets: 20% >2000: Tangible Assets: 80% <2010:intangible Assets: 80%

21. Global Economic & Income Imbalance Due to Limited Creativity & Innovation (201008) Population (Billions) National Income (US$) 80 20 1.5 B 6.02 trln 20 80 25.37 trln 5.7 Billion Developing & LDCs Industrialized

22. How IP Information has Increased the Innovative & Creative Capacity in Kenya • Before 1995, there were no local patent applications and limited local Creativity & Innovation; • In March 1995, an Education & Outreach Program was launched; • Since 1996, there has been a dramatic increase in • The Number of National Patent Applications; • Reverse Engineered Products by SMEs; • All Universities in Kenya now have IP Centers Business Incubators & IP Policies; • IP has been included in the National Constitution; • The Kenya Government has already adopted an IP Policy; • Improved linkage between Universities, Research Institutions, Industry , Businesses & the National Patent Office; • Increased number of Local Patent Infringement cases; • The Public is now aware of the IP system and its benefits;

23. ckiige@aripo.org