Intellectual property challenges facing the manufacturing sector in 2015
The manufacturing sector comprises a group of diverse and highly innovative businesses which are ever changing in accordance with market forces and technological advancements. That this is the case is reinforced by the findings published in the Foresight Report which predicts that “manufacturing in 2050 will look very different from today and will be virtually unrecognisable from that of 30 years ago”.
This rapid pace of change means that it is difficult for the sector to keep abreast of the risks and challenges that new and changing ways of working present. Whilst the risks and challenges faced in the intellectual property arena will differ substantially between manufacturing sub-sectors there are a number of trends that will apply across the piece and which should be given careful consideration by all involved in the manufacturing sector to ensure that the foundations for the future are robust and supported by the right protections.
The changes that will drive the manufacturing sector forward include enhanced focus on research and development, innovation and process efficiencies. Clearly, the output of those will require proper patent and design right protection to maintain a competitive edge. The process of registering these protections across numerous jurisdictions in many ways lacks harmonisation. Differences in registration requirements between jurisdictions should be carefully considered, with local expert advice an absolute necessity.
Perhaps of equal importance to these formal protections is attention to the knowledge transfer from the highly skilled workforce that will be needed to drive the development, innovation and efficiencies. Many of the proprietary rights capable of protection will be the creation of individual workers and steps need to be taken to ensure that appropriate contractual provisions are in place to guarantee that the intellectual output from key individuals is owned by the business and not the individual.
Appropriate protections for business critical information also need to reflect the risks of theft, loss or leaks from employees and third parties through open innovation and supply arrangements where the stakes in this technological era are high. Remote working, common use of mobile devices and the ease of information transfer all pose a threat. Careful thought should be given to clear and comprehensive contractual provisions to deter information breaches and tightly drafted, monitored licences and contracts with third parties where appropriate. Consideration should be given to the necessity of the information that is made available to third parties and whether restrictions should be imposed on information circulation equivalent to a confidentiality club.
A historical and continuing future threat for the manufacturing sector arises from the growing number of counterfeit goods and the increasing ease with which those products can enter the market. The growth of additive manufacturing particularly will make breaches harder for manufacturers to identify. Here action must be taken to quickly ring fence infringing goods to safeguard reputation and avoid brand deterioration. Identification of the source can often be difficult, particularly if there is an involved supply chain. Actions may be founded in trade mark infringement or passing off and an early application for a Norwich Pharmacal Order to obtain information about the originator of the counterfeit goods may be required as a precursor to any proceedings.
The Intellectual Property Court (“IPEC”) is ideally placed for cost efficient litigation for most intellectual property claims where damages do not exceed £500,000 and the issues are not particularly complex or technical. The costs cap of £50,000 in respect of liability issues may also allow greater certainty on costs.
Whilst this is only a small snapshot of the potential intellectual property challenges that those involved in the manufacturing sector may face, in a time of rapid change it will be appreciated that if manufacturers want to achieve sustainable and resilient growth the value of intellectual property protections should not be under estimated.
Gartner: Leaders Lack Skilled Smart Manufacturing Workers
With organisations rapidly adopting industry 4.0 capabilities to increase productivity, efficiency, transparency, and quality as well as reduce cost, manufacturers “are under pressure to bring their workforce into the 21st century,” says Gartner.
While more connected factory workers are leveraging digital tools and data management techniques to improve decision accuracy, increase knowledge and lessen variability, 57% of manufacturing leaders feel that their organisations lack the skilled workers needed to support their smart manufacturing digitalisation plans.
“Our survey revealed that manufacturers are currently going through a difficult phase in their digitisation journey toward smart manufacturing,” said Simon Jacobson, Vice President analyst, Gartner Supply Chain practice.
“They accept that changing from a break-fix mentality and culture to a data-driven workforce is a must. However, intuition, efficiency and engagement cannot be sacrificed. New workers might be tech-savvy but lack access to best practices and know-how — and tenured workers might have the knowledge, but not the digital skills. A truly connected factory worker in a smart manufacturing environment needs both.”
Surveying 439 respondents from North America, Western Europe and APAC, Gartner found that “organisational complexity, integration and process reengineering are the most prevalent challenges for executing smart manufacturing initiatives.” Combined they represent “the largest change management obstacle [for manufacturers],” adds Gartner.
“It’s interesting to see that leadership commitment is frequently cited as not being a challenge. Across all respondents, 83% agree that their leadership understands and accepts the need to invest in smart manufacturing. However, it does not reflect whether or not the majority of leaders understand the magnitude of change in front of them – regarding technology, as well as talent,” added Jacobson.
Technology and People
While the value and opportunities smart manufacturing can provide an organisation is being recognised, introducing technology alone isn’t enough. Gartner emphasises the importance of evolving factory workers alongside the technology, ensuring that they are on board in order for the change to be successful.
“The most immediate action is for organisations to realize that this is more than digitisation. It requires synchronising activities for capability building, capability enablement and empowering people. Taking a ‘how to improve a day in the life’ approach will increase engagement, continuous learning and ultimately foster a pull-based approach that will attract tenured workers. They are the best points of contact to identify the best starting points for automation and the required data and digital tools for better decision-making,” said Jacobson.
Long term, “it is important to establish a data-driven culture in manufacturing operations that is rooted in governance and training - without stifling employee creativity and ingenuity,” concluded Gartner.