The power of patents: Getting intellectual property management right at Microsoft

Feb 14, 2018   |  

At Microsoft, getting patents right is critical. Not only do they underpin the products and services that the company sells, they also stimulate ideas that keep it growing and competitive.

“We’re a technology company focused on innovation—intellectual property is our product,” says Michelle Crosslin, a paralegal lead in Microsoft Corporate, External, and Legal Affairs (CELA). “Our patents protect our intellectual property and our customers.”

The intellectual muscle behind the company’s 90,000 active patents is a strategic asset that allows it to keep its competitive edge. Keeping that edge razor sharp is crucial. It’s also something that has become more challenging as the company grows, its patent management processes age, and its competitors get faster.

“We’ve gotten to the point where managing our information and tools has become disjointed,” Crosslin says. “That has made it difficult for us to file our applications as fast as we might want—introducing risk that our competitors could beat us to the chase.”

Patent filings at Microsoft need to keep pace with the innovations its employees are creating. “Our business is thriving,” Crosslin says. “This leads to a lot of quality patents.”

To appreciate what that means, it’s important to understand the scope of the growing amount of patent work that flows through the team’s doors—each year Microsoft employees submit about 5,000 ideas for potential patenting. The challenge is that the team’s 30 attorneys and 15 paralegals must review all those ideas, coordinate with the inventors, and then select which ones are best suited for patenting.

That’s a lot of work.

To handle the overflow, the team has been relying extensively on external vendors to cover the gap, but now even that approach isn’t enough, especially with new rules that are enticing competitors to file competing patents much faster.

In 2013, the United States switched from a first-to-invent to a first-to-file country, setting off chain of events that made filing patents quickly much more important (and improving the patent process even more urgent). “We had a filing system of 90 days or more and we were finding that a lot of our patents were being kicked out by other companies or inventors who were moving faster,” Crosslin says. “We even lost one by five days.”

The hard reality was the team was struggling with an unconnected, third-party, on-premises tool. The leaders of the team realized that Microsoft needed to overhaul the entire patent process. A transformation was needed.

Rebooting patents

Tackling the challenge head on, two years ago the team adopted a new portfolio management tool that runs on Microsoft Azure. The new tool, CPA Global’s Memotech, was implemented in partnership with Core Services Engineering and Operations (CSEO), the legal team’s IT partner.

Headshot of Jon Dammand
Jon Dammand helped Core Services Engineering and Operations deploy the new patent process for CELA.

“Moving to Memotech gave us the opportunity to have a more connected process,” says Jon Dammand, a senior program manager who worked on the CSEO team that helped deploy the new patent process. “We’re managing this process all the way through, using a single system, whereas before we were dealing with an operational nightmare.”

Funneling patents into one end-to-end system allowed the team to streamline the approval process, shaving the time it takes to approve a patent down to 45 days and increasing the team’s capacity to manage ongoing patent prosecution work by 3 times. “We’re down to filing within 45 days which is significant because every day that you don’t file, you risk someone else getting there first,” says Melanie Carmosino, director of intellectual property operations in CELA. “We are also able to address all of our patent prosecution tasks in our new system, versus only a portion in our previous system.”

Additionally, using one system to manage everything allowed the team to create one set of data—one version of the truth—that it can glean insights from. “It used to take us about two to three weeks to build a report because we would go through IT or someone else,” says Carmosino. “Now we can self-build a report in five minutes.”

The team has also seized the opportunity transforming the patent process created to trim a lot of deadwood—patents that aren’t being used have been pruned out and steps and processes that aren’t needed have been cut.

“We have spent the last year and half, since we implemented Memotech, going through the portfolio and getting rid of low value assets,” Carmosino says. “Having a massive portfolio of patents is difficult to manage, and assets that aren’t valuable cost us a fortune in ongoing annuity and prosecution costs. Now that we can better understand our portfolio, we can make better decisions for the business.”

Now with a new set of tools to work with, the team is looking forward to what’s next.

“Looking forward, we can now use the data underneath all the improvements we’ve made to our patent process to better analyze what we’re doing, and to learn from it,” Carmosino says.

She said that will give the team a deeper understanding of its overall portfolio, allowing it to cut costs by pruning low-value assets. More importantly, it will continue to ensure that the company’s patent portfolio remains a core strategic asset.