Licensing Strategy Formulation and Implementation
Identifying new opportunities for computer software development, and understanding the potential benefits and ramifications of licensing
The Situation
A government department, TaxMoney@Work, (TM@W) had developed and launched a
computer software to manage relationships with it constituents. The development
of its own client relationship management system was necessitated because
a suitable system was not commercially available. The government department
believed that there might be an opportunity to license their system to other
government agencies, thereby enabling the recovery of development expenses
and perhaps the generation of funds for other initiatives.
The Challenge
In order to assess the potential of licensing, TM@W needed to gain an understanding
of:
- the commercial potential of its development,
- channels to market, and
- ramifications of undertaking a licensing program.
The Solution
To assist the TM@W with assessing the licensing potential for their proprietary
custom software, Vertex first gained an in-depth understanding of the product
that had been developed. Extensive market research was needed to gain an
understanding of the client relationship management challenges that existed
in other organizations and the key features of TM@W's system that would be
attractive to other potential users. Vertex developed a commercialization
approach for TM@W and provided advice regarding about the implications of
undertaking a licensing program.
The Result
Armed with an understanding of:
- the potential market for their software product,
- probable revenue that could be achieved, and
- effort that would be required in the sale of a license and with the customization of licensee systems;
TM@W was able to make an informed decision regarding the feasibility of pursuing a licensing program.
