Validating a Novel New Instrument for Measuring Firm Managers' Intellectual Property Management Practices: A study of biotechnology firms

Abstract

Purpose: The purpose of this research project was to pilot and validate a new instrument to measure firm intellectual property (IP) management practices.Methodology/Approach: A survey instrument was developed in consultation with a Perth-based firm of patent attorneys specialising in IP management services. The survey was piloted by random mail-out to 357 biotechnology firms, 68 of which returned a useable response. IP managers' responses to the following seven dimensions of extent of IP management practice were measured on a 5-point Likert-scale: 1) Record-keeping and management practices (22 items); 2) IP capture and protection mechanisms (10 items); 3) Use of IP management services or traditional patent attorney services (9 items); 4) Defensive measures (12 items); 5) Business Plan and strategic vision (9 items); 6) Knowledge of the IP landscape (9 items); and, 7) Promoting an IP culture (7 items). Factor Analysis and Principle Component Analysis extraction method with Varimax Rotation were used to identify factors measured by our instrument.Findings: Between two and seven factors were extracted for each of the dimensions measuring IP management practices, explaining between 51% (IP Defensive Measures) to 74% (IP management services and traditional patent attorney services) of the cumulative variance on any one factors. Scrutiny of the Component Matrices for a common thread amongst large loadings indicated thirteen actual measures of IP management practices perceived by biotechnology firm IP managers; with high Cronbach's Alpha reliability.Research limitations/implications: Factor analysis of this instrument revealed that IP managers' responses were loading on 13 factors instead of the original 7 anticipated dimensions to the measure. The spread of 78 item was reduced to a more relevant and economical measure with 56 items. As scrutiny of the factor analysis has revealed increasing heterogeneity to IP management practices in the biotechnology industry, it might be interesting to repeat the study for IP managers in another industry. A limitation of the study is its Australian biotechnology context and also that no concession was made in the measure for the effect of firm vertical disintegration.Originality/value: To our knowledge this is a novel project. We have validated and streamlined a new IP management practices instrument with advice from a practicing firm of IP management consultants. The instrument should be useful to high-technology firms as a checklist of IP management practices for innovation management. It should also be a valuable measurement tool for academics, firms and industries wanting to characterise the nature of firm-level IP management practices.