IP benchmarking: A quick win for in–house intellectual property counsel

IP benchmarking is an IP management service that assesses and determines whether the current charges applied by local counsels are still competitive for their business needs.

The role of an intellectual property counsel is to be a legal adviser for the internal business as well as a manager of external activities related to the legal and IP strategy. Similar to the responsibilities of a general counsel, they are expected to act as advisors and leaders within an organisation to drive the growth of a successful and diverse IP portfolio.

While driving this performance, they also need to optimise costs to ensure that the external fees associated with IP do not become exorbitant for the business. This is where IP benchmarking can bring value.

As an IP portfolio grows, each additional IP asset comes with its own set of costs. In many cases, a business will use local agents to protect and enforce IP rights. Therefore, one of the main costs that can become burdensome in a growing IP portfolio is agent fees. Over time, these fees need to be reassessed and compared with the profitability of each IP asset, which can be a cumbersome undertaking, especially with a large IP portfolio that requires resources in multiple jurisdictions.

What is IP benchmarking, and why is it useful?

IP benchmarking is an IP management service that is used to assess and determine whether the current charges applied by local counsels are still competitive for their business needs. In the first stage of the benchmarking process, detailed information is gathered about the current fees being charged as well as the applicable categories of work. This information is gathered within a proprietary online platform and then compared against fees charged to other businesses in similar industries with similar categories of work. Various data will be used to draw the most relevant comparisons, including the industry or industries of the business, the geographical locations of the business and the comparable or competitive businesses.

The results are provided in a detailed report, which demonstrates how the current fees being charged to a business compare with market rates. With this information, an IP counsel can make informed decisions about how a business can optimise costs. The pricing matrix within the report provides them with a breakdown of charges, whereby they can view service provider fees and the acceptable level of charges for their needs. They can also make more informed legal and business decisions about which IP assets are profitable to maintain within their portfolio.

How can in-house IP counsel leverage benchmarking data?

When an IP counsel has decided on the pricing levels that make sense for their business needs, the benchmarking provider works with the local counsel and attorney network to negotiate new fee agreements, thus lowering future counsel fees billed to the business. Overall, the process of IP benchmarking aims to ensure that a business is not overcharged for services from external counsel. However, the information gathered through the process can also provide valuable insights into how funds are allocated for IP management.

Managing and leading activities for an IP portfolio cost-effectively can present many challenges for an IP counsel, especially when operating within a global market. By using an IP benchmarking service, it can provide clarity, transparency and control over external IP service costs. It ensures that a business is not unduly overpaying for external counsel.

Can benchmarking improve IP portfolio efficiency?

Whether the goal is to optimise costs, renew agreements or gather information for internal knowledge sharing, the first step in an IP benchmarking project is to carry out preliminary research to understand how a business works with its counsel. We work with IP leaders to help them through this process by creating a bespoke strategy depending on their desired outcome of an IP benchmarking project. We have also helped clients consolidate and optimise their networks, providing control over their external resources as well as their budget. 

Contact our team today to find out more about the benefits of IP benchmarking.