by Maryfran Johnson

Are Patents the Secret to Competitive Advantage in IT?

Sep 28, 20122 mins

CIO magazine editor in chief Maryfran Johnson weighs in on the importance of seeking patents for IT innovation when it comes to maintaining a competitive edge and driving new business.

Innovation is always a favorite topic when CIOs gather to talk about their businesses. That beloved “I” word was also front and center in the rush of late-summer punditry around Apple’s legal victory in its patent-infringement lawsuit against rival smartphone-maker Samsung.

The upshot for consumers, many analysts say, is that Apple’s many other rivals should produce a flood of greater innovation and creativity–if only to avoid more lawsuits. Well, maybe. I think the most important result of all that publicity will be the wake-up call it delivered about the vital role patents can play in competitive advantage.

“If CEOs want innovation, then CIOs ought to want patents,” writes Senior Editor Kim S. Nash in our cover story (“Companies Race to the Patent Office to Protect Their IT Breakthroughs”), which explores why more companies in more industries are now rushing to protect the competitive advantage of IT-driven innovations. “The innovation mandate, and the convergence of social media, mobile technology and analytics, has companies running to the patent office, trying to lock in ownership of new ways to do business and interact with customers,” Nash explains. That’s especially true in industries where IT is reshaping business models: healthcare, automotive, retail, insurance, consulting and airlines.

Would you be surprised to hear that $28 billion Allstate Insurance has more than 100 patents pending? Its patent portfolio has doubled in the past three years and is considered a major asset in “keeping the company ahead of the competition,” says a spokesman. And United Parcel Service, that nonstop innovator, has secured 313 patents–69 of them in the past two years. “We are very active in this space and extensively utilize technology innovation to drive our business growth,” says CIO Dave Barnes.

Our story delves into how CIOs–as senior business leaders who must protect the company’s intellectual property–are now expected to come up with both defensive and offensive patent strategies. We also cover the many intriguing twists and turns that companies can encounter in the pursuit of patents, with specific examples from companies such as Equifax, American Airlines, General Motors, Travelers,, Bank of America and Humana.

As IT continues to transform business models across so many industries, the pressure on CIOs to protect every advantage can only increase. And a patent may indeed represent your first line of defense.