[PDF]The 4x4 Innovation Strategy

HOW TO TURBOCHARGE YOUR INVENTIONS
(AND MAKE A SUCCESSFUL PRODUCT)





Copyright © 2020 Martin Schweiger
All rights reserved. Copyright protected.


I am making it free for my readers to re-print single chapters, but not the entire book
or large parts of it. This is provided that any re-printing is done without making changes
to the content, wording and images, and that the title of the book and my name is used.

You must send me a link to any reprints you make, so that I can mention it on my website.
Please email me at martin.schweiger@ip-lawyer-tools.com.


ISBN: 9798674679592


Contents























About this Book vii
Part A: Innovation 13
Tactics, Strategy, or Wisdom. Success or Failure. 14
Part B: Hierarchy 32
Innovation Strategy: the Big Picture 20
Part C: The Rules 56
R&D 57
Freedom-to-Operate 83
IP Protection 95
Market Validation 121
Part D: The Consequences 139
‘Two Inventors, Two Outcomes 140
Part E: Conclusion 146
A Call to Action 147
About the Author 150
Index 152


The 4x4 Innovation Strategy
How to Turbocharge your Inventions
(And Make a Successful Product)


This book starts where other books about innovation end.

Having seen more than one hundred bankruptcies from the inside and
more than six hundred failed product ideas over 27 years, Martin Schweiger
takes the reader by the hand and walks him down to the morgue. By way
of example, he dissects dead innovation and derives a simple yet efficient
structure that helps you better understand what made these casualties
happen. Starting from there, it becomes clear that—as is often in life—an
organized defense line is more important than a bold center forward.

Entrepreneurs receive a big picture model to easily communicate what
they are planning to do, aligning their technicians and managers to perform
better in new product development. Investors get a more transparent
picture of what they are investing in, what they can possibly expect in the
near future, and when is a good time to exit their investment.

This book also helps people who advise start-up companies in business
matters, such as general lawyers, accountants, and marketing experts. It is
Martin Schweiger’s calling to produce materials that guide these support
professionals through the minefields that come with innovation. This book
will also help them to better cooperate with patent attorneys, who are the
trained hands-on specialists in intellectual property law.


This book is for:


— Inventors who want to commercialize their innovative ideas, and who
believethatasuccessful businessisnotjustaboutthe products themselves


— Legal professionals who want to help their own clients when asked
for advice outside their own domains of expertise


Introduction vii


— Innovation Managers who want to help their R&D teams to stay on
track and to meet their KPIs


— Young and bright people who want to understand how intellectual
property, innovation strategy and entrepreneurship fit together


This book can be found in three versions:


— The Shotgun Edition, a summary condensing the most important
points for time-strapped readers. It comes in the form of a Kindle
ebook for easy reading on a handheld device. Like a shotgun, this
edition intends to shoot in the general right direction with hopes
of hitting the target.


— The Rifle Edition, a comprehensive business book meant for pro-
fessionals who work with inventors, be they accountants, lawyers,
investors, bureaucrats, or even the general public. It comes in the
form of a PDF. Like a rifle, this edition is more powerful than a
shotgun, and can go a further distance in explaining these complex
concepts. You also get a one-month trial ordinary membership access
to Martin Schweiger’s personal website, with training courses for
intellectual property, innovation strategy and business-related topics.


— The Scope Edition, a value-added premium hardcover version in-
tended for innovators and their managers. It comes with a one-month
trial premium membership access to a section of Martin Schweiger’s
personal website that is hidden from the public. There you can get
personalized information when you need it. Like a scope rifle, it is a
powerful, highly-focused tool to further advance and promote your
innovation in depth.


viii The 4x4 Innovation Strategy


What you hold in your hand is the Rifle Edition for professionals. Each
part is cross-referenced with Martin Schweiger’s online portal at www.
ip-lawyer-tools.com where there is supplementary material to support
your understanding. As this is dynamic material, Martin Schweiger
expects regular updates of his books. In the meantime, please join our
online community!


Introduction ix


This book is dedicated to Dr. Gary North,
scholar, businessman, author, publisher, gold coin
salesman, ex-employee of the sovereign state of the US
Congress, biblical economist, online homeschool curricu-
lum developer, marketer, counselor, cancer survivor, father
of four, mentor, teacher, and child of God.


Part A: Innovation
And the Transcendent Power Behind Innovation


There is an innovator inside some of us. Not in everyone, but only a
few selected people.

It is my firm belief that you are either born an innovator or you will
never become one. The ability to innovate is inseparable from your nature.

Innovation is a deeply human instinct that cannot be analyzed or auto-
mated. At its most fundamental, innovation is a capacity for imagination,
inventiveness, inspiration...and the ability to combine these powers to
create new technologies.

Because most people do not have it, innovation can seem a mystery; a
realm of genius or chance, accessible only by a lucky few. We celebrate
famous innovators and inventors for how their ideas have changed our
world.

But this is just one side of the coin. Being an innovative person often is
a curse, and not a blessing. Many innovators end up in bankruptcy and
depression.

The difficulty lies in developing your fragile new ideas into viable,
commercially-successful technologies. Because innovation, if done wrongly,
has drastic consequences.

The good news is that there is a natural structure governing the field of
innovation.

It is my calling to shed light on this structure. This is my ultimate reason
for writing this book for you, a professional who works with inventors.
Because I want innovators to have a guide map for bringing out the best
in themselves, instead of stubbornly fighting against nature.


Visit www. bit.ly/4x4-innovation for Part A updates and discussion forums.


Part A: Innovation 13


Tactics, Strategy, or Wisdom. Success or Failure.
Winning the Innovation, IP and Business Game


Introduction
It is a big jungle out there, in the world of entrepreneurship, innova-
tion, and setting up a business.

As an inventor, entrepreneur or legal professional, you cannot afford
to be ignorant. Successful commercialization of an idea requires applied
proficiency at the intersection of innovation, intellectual property (IP) and
commercial best practices.


For inventors and entrepreneurs, ideas are easy, but getting to
market successfully is a marathon with a high failure rate.


— The 4x4 Innovation Strategy teaches you to hedge your risk through
applying effective innovation strategy so that your business does not
die before your product is out.


— It gives you the background and resources to know what you do
not know about intellectual property, and to make decisions about
paying for legal advice.


— It shows you, through various examples and models, the blind spots
that every aspiring inventor should be wary of.


For professionals who work with inventors, you risk getting
silo-ed in your area of expertise, and ignoring the bigger business
and technology picture.

— The 4x4 Innovation Strategy helps you to offer relevant legal and


business advice when inventors come to you with a great product idea.


14 The 4x4 Innovation Strategy


— It gives you interdisciplinary expertise, because just being an expert
in your field is not good enough these days.


— It takes you through the basics of IP in the context of technology
product development; useful if you are not a patent attorney and
want to know how IP is successfully done.


I have walked around this jungle, and seen the problem from different
angles. While success is never guaranteed, you will find important
concepts explained in a unified and useful way.


Tactics, Strategy, and Wisdom
You may have seen the term “Innovation Strategy” in the title of this
book.

This title comes after years of hindsight. I have not seen a single book
about innovation that does not jump straight to R&D tactics or to patent
tactics, often right after Chapter 1. In fact, people often use the terms
“R&D” and “patent” as synonyms for “innovation”. Many even measure
the innovation potential of a company or an entire country as the number
of patent applications filed over a period of time.

‘That is not a good way of measuring innovative power. Years ago as a
young engineer, I went deep into R&D. And I had many good ideas.
And because I wanted to know more about making my own inventions
successful, I became a patent attorney.

After practising in the area of patents for almost three decades, I realized
that my initial approach to innovation was dead wrong. Over time, I even
learned to like intellectual property, and found out that patents are only
one of the 25 tools in a patent attorney's toolbox. But I also found out


Tactics, Strategy, or Wisdom. Success or Failure. 15


that patent tactics is only one of four strategic areas that innovators need
to cover in order to be successful.

Now that half my life has passed, I begin to see the entire picture. There
is much more to consider in the area of innovation.


A Natural Five-Layer Structure
I have discovered a natural five-layer structure in innovation, which
this book mirrors in its five parts A to E.

A complementary structure, describing five levels of insight, can be found
in the minds (not mindsets) of innovators. Simply put, the goal is to move
up from zero insight to full insight, which crests in achieving wisdom in
innovation.

To achieve a higher level of insight, you need to understand the dif-
ferences between knowledge and wisdom. Knowledge tries to game the
system. Wisdom cooperates with the principles of the system. Knowledge
is interested in what you can get from an innovative idea. Wisdom cares
about what seed you sow in order to derive income from it.


Insight Level 1: Robot. I am only including this for the sake of com-
pleteness. Minds at this level have no insight, nor knowledge, and you
can forget about wisdom. If you are at this level, you just react to what
happens. You are told what to do, when to do it, and how to do it. You
function like a robot with no independent thought.


Insight Level 2: Basic Facts. The lowest level of insight is knowledge.
This means possessing the basic facts. For a patent attorney, it would
be knowing facts, such as, the Paris Convention deadline for claiming
priority of a foreign filing date is 12 months for patent applications. For
everyone, you would know standard facts like 4 x 4 = 16.


Insight Level 3: Tactics. These are techniques. Plans based on knowl-


16 The 4x4 Innovation Strategy


edge. Methods, shortcuts, and ways to get things done. If you want to
draft a good patent application, get a checklist from us on the ten most
serious pitfalls to avoid—that is a tactic. Other examples of tactics include
filing a patent application in a certain country, or adding a specific claim
category to your patent application that enhances the scope of protection
of the later granted patent.


Insight Level 4: Strategy. This is the overarching plan, the approach.
Strategy is knowing that in innovation, there is an order or hierarchy of
what to do, and when to do it. Strategy is defining your innovation in
terms of what really matters (“I can solve this pain and there are people
who would pay for solving it”), instead of the assets you have (“I have
a patent portfolio”).


Insight Level 5: Wisdom. This is the highest level of insight. Wisdom
sees the highest purpose in everything you do. Wisdom does not let
small things dictate big things. Wisdom is being able to see the reason
why you are doing innovation, and how to practically align it with the
overall goals of your company.


In innovation, the level of wisdom is difficult to reach. While I do not
think that each and every innovator can learn to achieve wisdom in
innovation, I do know that many innovators carry the seed for wisdom
within themselves.

This book is a guide for people who work with innovators, to help them
advance to the level of wisdom.

What follows next are some fundamental attitudes and assumptions
about innovation, that directly affect the chances of success or failure in
innovation.


Tactics, Strategy, or Wisdom. Success or Failure. 17


Success and Failure

Start-Up Failure is Common

While my clients are usually big MNCs or SMEs, I have a soft spot
for start-ups. I have always set aside time for very small companies,
because I know I can help them.

Over 27 years, I have seen about 100 bankruptcies from the inside. Why
do I see bankruptcies from the inside? Because when a company with
Intellectual Property (IP) goes bankrupt, the bankruptcy liquidator always
wants to know, “What can we get for selling these patents, trademarks, and
Internet domains?” I would then help him to sell the IP. When everything
is over, we would sit down together to have a nice meal, and he would
usually tell me why this particular start-up went bankrupt. So yes, I am
familiar with bankruptcy.

I have also seen about 600 failed products. How do I know a product
has failed? Because if inventors have filed patents for their products with
my firm, and suddenly send an email along the lines of, “Hey, I don’t want
to pay the renewal fees for this patent,” it means that they are giving up
their patents. If I ask what the problem was, the inventor always says, “It
didn’t work out.”

Being curious, I always need to find out why it did not work out.
The answers? Yes, there is a patent, but nothing has been done to bring
the invention to the market. Or, there is a sophisticated prototype but
“it still has too many bugs”. Or perhaps there is zero knowledge about
competitors, and also nothing known about their competing products.
And Freedom-to-Operate (FTO) is a mysterious loanword. And so on.
In short, a great many reasons why the product or even the start-up failed.


The Problem With “Fail Fast”

Silicon Valley’s famous phrase “fail fast” is used to describe how
start-ups should celebrate and embrace failure. Other versions of
these include “fail fast and fail often”, “fail forward” or “fail better”.


18 The 4x4 Innovation Strategy


It basically says that entrepreneurs need to throw themselves into
their ventures, no holds barred, and achieve some spectacular failures
before they get a success.

This is an attractive point of view. It is also conventional start-up think-
ing—a popular management buzzword that both inventors and investors
like to use to impress the media.


I personally think it is stupid to glamorize failure. Here are some issues
with “fail fast”:


— It is a fantasy, and not one created by actual inventors. It is bad advice,
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