Journal of Intellectual Capital

Purpose – The purpose of this paper is to analyse how a patent is an intangible asset and how it creates value.

Design/methodology/approach – Through analysis of a set of cases, the paper analyses how a patent becomes related to a series of other elements. This approach investigates the details of how a patent becomes useful. Theoretically, the paper suggests that a patent only creates value from being entangled in a web of resources in action, contrasting this with patents on hold where they are described as entities but not as resources.

Findings – The paper shows that patens a valuable not by themselves (on hold) but by being linked to a series of other resources and purposes (in actions). To understand the value of the patent is to understand its relationships to other mechanism in production, marketing and finance.

Research limitations/implications – The paper sets out an approach to study the value of patents which looks at the network around the patent. This is a limitation inasmuch as it is difficult to generalise the particular findings, but as a prospective research strategy, its strength is that is allows insight into the complexities of making patents valuable. This can also add to statistical work on the contingencies for patents' value.

Practical implications – The paper suggests that a strategy for patenting must pay attention to the different kinds of resources that make it useful. Often it is necessary to look far beyond the patent office to gain this knowledge. The management agenda is clear: the patent has to be entangled, but this also raises questions, because since the patent is an option, some of its value derives from exploring its possibilities. This however, blocks for its exploitation and thus causes opportunity costs. From a management point of view, it is not always clear that a patent should be used for its maximum potentiality, because this would disrupt the network is it part of and make it a very expensive resource to mobilise towards innovation

Originality/value – Typically, research on patents has taken the route via statistical and economic analysis. Our paper adds by showing the dynamics of managerial uses of patents and it shows that the structural conditioning of use of patents can fruitfully be supplemented by process and network approaches to their use.