Stop Throwing Away your ICT4D Investments: Recognizing Intangible Assets

One of the services we provide at Sonjara is the technology evaluation. These evaluations range from software reviews (is the code base good, secure, and scalable?) to more strategic analysis of an existing technology investment, how it links and supports the underlying development objectives, and what the next steps should be.

One pattern we have seen working with the US Government and in ICT4D is when a contract or cooperative agreement funds a technology investment, such as a database, website, or mobile App. The project may be very successful during its lifespan.

But what happens to the technology when the funding ends?

In some cases, the contract is extended or re-bid, with the new bidders being responsible for managing and supporting the existing technology; it is very rare that the evaluation criteria or the RFP Scope includes necessary details on the existing technology infrastructure, causing many bidders to underestimate the cost of managing this technology investment.

I have seen some cases where the existing sites were not mentioned at all in the RFP, and only because of the due dilligence of the proposal writers, were we aware that supporting them would be required (and budgeted for).

In some cases, the contract is not extended, or for whatever reason, it is decided that the technology will no longer be supported. I have seen more websites with valuable information, and applications that could be scaled shoved in a drawer or housed on a backup tape deck than I care to think about.

In most cases, the decision about what to do with the technology does not recognize the intangible assets that the technology investment has generated, leading to decisions that often squander this investment.

Decisions like changing the name of a project will destroy Search Engine Rankings and Social Media strategies. Failing to plan a data migration strategy for an aging infrastructure means a lot of valuable historical data is lost. Not putting in enough human resources to support an online community of practice can see that vibrant COP die. The money that was spent on these technology projects is wasted without this recognizition of the value of the intangible assets.

DEFINITION OF INTANGIBLE ASSETS

According to Wikipedia, intangible assets are “identifiable non-monetary assets that cannot be seen, touched or physically measured, and are created through time and/or effort and are identifiable as a separate asset."

Key elements include the following:

• Elements of the asset may exist legally in the public domain or be owned by another party but the asset in totality involves processes, know-how, and reputation that are a core part of the asset’s value.
• These assets can be transferred, extended, nurtured, and preserved; conversely, they can be lost if not nurtured or protected.
• The nurturing and extension of these assets requires an investment from the organization in terms of money, level of effort, and other resources.
• The valuation of these intangible assets is measured in either the cost of recreation from scratch or cost of lost productivity, impact, and/or other negative outcomes of the loss of use/access to the asset.

The key element is the understanding that the US Government has invested in this technology, but more often than not, decisions about using, maintaining, or archiving the technology are not made strategically.

Examples include

• A web community of practice with over 15,000 active users and 10 years of archived content
• A database of project data, detailing links and documents related to the different projects
• A portal of over 30,000 documents, articles, videos, and other media related to a specific subject matter, and high SEO rankings
• A grants management tool that has the archives of all grants administered and managed by an office
• A mobile app of a handbook for field staff, with wizards for decision making
• An online training tool to help policy makers generate master plans for budgets

Any of the above examples have value that, if not recognized and protected, will be lost.

Five elements of intangible assets

Roughly speaking, there are five elements of intangible assets relevant to this evaluation. They are:

• Brand awareness and reputation
• Audience engagement and community strength
• Technology investment
• Content and data repository
• Special expertise and thought leadership

In the next week I will outline each item, some valuation/loss calculations (i.e. what is the impact of not protecting the element), and some recommendations on how to protect it.