Global Trends in Innovation Intelligence — A Guide for PatSnap
This report is part of an assignment for the MSc Innovation Strategic Management that I am currently pursuing.
In today’s hyper-competitive markets, a company’s ability to oversee relevant innovations emerging in its respective markets is regarded as an absolute business necessity in order to foster and maintain a company’s competitiveness(Golovatchev et al., 2010). Therefore, innovation intelligence1 services offered by technology radar companies, such as PatSnap2 , solve the market need to provide valuable insights from large and rapidly growing data on technological developments using research and development (R&D) and intellectual property (IP) data. This report aims to provide a guide for PatSnap to remain the leader in innovation intelligence by learning about global trends in this emerging field.
Trend 1: AI in innovation intelligence services is bound to continue Innovation intelligence has flourished with the introduction of artificial intelligence (AI) (Nobari. et al. 2020), more than being a trend, AI is one of its enablers. IP and R&D data grows exponentially; according to the USPTO, in the last 25 years, the number of granted patents has doubled, and an estimate of 7 million papers are published each year (Fire and Guestrin, 2019). As the world recovers from COVID-19, enterprises are expected to seek to license their portfolios to create new value (Mordor Intelligence, 2021), and therefore IP numbers are expected to increase further. To create insights from this data, human analysis is far from sufficient. Fortunately, AI enables the connection and analysis of millions of data sources by segmenting them by industry and relevance, uncovering and predicting emerging trends, spotting risks, and identifying opportunities that then can be turned into actionable insights.
Resolute AI3 , one of PatSnap’s largest competitors, has built its service and brand around AI and machine learning (ML). They harness the power of AI by accessing and analysing unstructured data from text, images, audio and video. They go beyond keywords by researching related concepts, and the platform continues to connect concepts, themes, ideas, and insights through ML. All in all, the exploitation of AI and ML is bound to continue as these technologies become more and more sophisticated.
Trend 2: Offering insights along the whole innovation process
R&D translated into IP is an essential source of innovation, and as such PatSnap competitors like Anaqua or CPA Global have focused solely on intellectual property management. Similarly to PatSnap, they have developed SaaS focused on tracking patents, copyrights, trademarks, design, and other intellectual property. However, the diffusion of innovation, such as commercialisation and marketing, also has a high impact on the company’s ability to capture value from R&D. Therefore, innovation intelligence cannot just offer IP insights, it needs to provide actionable guidance along the whole innovation funnel from ideation to commercialisation, and in this way thoroughly guide companies into developing and launching new products and services. Innovation Intelligence AI4 , one of PatSnap’s competitors, is a good example of more complete services; it offers an end-to-end solution to search and select start-ups and measure innovation.
Trend 3: Valuation of intangible assets
The COVID-19 pandemic has accelerated the investment in intangible assets, shifting growth based on skills, knowledge, digital and other technologies in an increasingly dematerialised world (McKinsey, 2021). Intangible assets include intellectual property (IP), research, technology, and human capital. Intangible assets account for the largest proportion of a company’s value, accounting for 84% of all enterprise value (AOL, 2020). Shareholders and other stakeholders are recognising more and more the growing impact of intangible assets on a company’s overall value. However, these assets are not easy to value as they lack a physical form that can be translated into a specific amount of cash. Valuation techniques are poor and rely on many assumptions made by managers.
Valuing intangible assets becomes highly relevant when transactions occur between companies. Therefore, there is an opportunity to provide intelligent valuations of intangible assets that can provide guidance for banks, shareholders and stakeholders when performing transactions. In addition, innovation intelligence services might be well equipped to draw on IP and R&D data to estimate the value of the assets. This trend can be classified within the 4Ps of innovation space as a product innovation as this will be a new offering to clients
What are the implications for PatSnap?
Since its origins in 2007, PatSnap found a niche that had not been addressed: IP analytics. Many thought the company could never be profitable in such a niche space and investment was reticent (Start-up Snapshot 2021). However, in 2021 this reality has changed, and IP services have boomed. With increasing IP activity, the global intellectual property management software market is expected to more than duplicate by 2026 (Mordor Intelligence, 2021). This boom has enabled PatSnap to capture the market and attract investors, granting PatSnap unicorn status since April 2021. However, if PatSnap wants to continue leading the market and growing, it will have to get ahead and shape innovation intelligence. Therefore, based on the outlined trends, the following recommendations are proposed for PatSnap.
PatSnap should have data scientists researching and developing more advanced tools that create deeper insights and constantly study — as they do with the service they provide — what other competitors are doing. Innovation Intelligence is a new service that is still in the process of being defined and shaped as data analysis tools powered by AI and ML advance and clients’ needs become more complex and demanding. Being on top of technological developments in the field will enable PatSnap to keep in the frontier and shape the service.
PatSnap has the opportunity to provide a more complete service by offering actionable insights that can guide companies in the whole innovation process from idea to commercialisation. Some of these services have been provided by consultancy companies, however technology can allow insights throughout the entire innovation journey, such as to market or differentiate a new product or service. Therefore, PatSnap must work closely with their customers to understand what other services could add value and identify common patterns of needs from companies. In this way, PatSnap could create more value for their clients and expand the offering of their competitors beyond IP analytics.
Lastly, drawing on their existing portfolio and capabilities, PatSnap could value IP assets, thus offering a powerful new service that could create a robust competitive advantage. Today more than ever, intelligent valuation tools are needed, and PatSnap could address this gap in the market
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1 Innovation Intelligence is the process of knowledge management for innovation decision-making. (Nobari. et. al. 2020)
4 https://innovationintelligence.ai
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