INSIDE INTANGIBLE VALUES MARKET (IVM)
Updated: Mar 20, 2020
Market Is the virtual place inside the Firm where the Humans with his Intellectual Capital and his Human Personal Resources will interact with the Firm Intangible Capital represented by the explicit knowledge base, machine deep learning assets, machine- embedded algorithms, RPA (Robot Process Automation), procedures, AI training courses , Business Process Models and documents, Organizational procedures, Manufacturing Process receipts , best-practices in sales, customer care, IT support, purchasing rules, software applications procedures, partnerships conventions, customer service procedures, projects returns on action reports, competitive advantage reports, organizational rules, market and competition analyses, all the data bases , Firm patents , copyrights, author protected creations, drawings...
The Human Creative Activity included in different Value Centers in which all this Intangible Assets and Values are distributed, will use the Intangible Assets and generate more Intangible Value by his creative power.
“talent accelerators—are similar to an internal marketplace for talent. Their responsibilities include identifying the most relevant project-based work across the organization; defining the knowledge, skills, attitudes, and experience required; and then finding the best-fit talent.” 2020 McKinsey & Company
The Value Center can be around a DSML platform (Data Science Machine Learning) with Experts Data Science but also Citizen Data:
“Citizen data scientists can come from roles such as business analyst, line of business (LOB) analyst, data engineer and application developer. ...Citizen data scientists do not replace expert data scientists but, instead, work in collaboration with them... Building Enterprise AI isn't about siloing data efforts in one team - it's about democratizing the use of data and machine learning across the organization, from top to bottom. That's why the role of data science and machine learning platforms has become critical for companies that want to succeed in the race to AI.” (Gartner 2020 Magic Quadrant for Data Science and Machine-Learning Platforms , DSML)
Low code development is changing the way to treat the Intangible Assets the software applications are build by Citizen Low code with no program development skills but with very clear business inside and learning fast low-code execution of his business procedure. Human is voluntary independent to chose to execute this application, which is not in his job description.
RPA is a collaborative multidisciplinary action, for most of the participants is not a full job and not a duty, but a smart way to treat the stupid repetitive work. The AI involved in this automation bring attractivity and creativity for the participants.
Of course, not all participants are delivering their “Value Contributions” out of a job constraint, but the RPA process and roadmap is certainly an Intangible Assets even if the FASB , IAS 3, 38 will decide if it is a result of a project or internally produced Intangible Asset so the Fair Value is different.
The “Cognitive Enterprise” based on collaborative platforms for different Intangible Assets production and usefulness are the “BRAIN” of the Enterprise , the Firm “neuronal network” is build on these platforms.
The Internal Intangible Value Market (IVM) is THE PLACE where Companies Create the most of their Market Intangible Value.
The platforms for different functionalities like : sales, manufacturing, purchasing, partners relationship, ERP, RPA, AI, Data Sciences &Machine learning, BI & Analytics, Business Process Modelling and Mining, all these platforms are crossing the IVM (Internal Intangible Value Market) and interact in a symbiotic relation with the Human talent and his creative power, this is the engine and the fuel to the Company Intangible Value Market development.
The platforms and algorithms and Business Process Models , procedures... are the organizational and structural intangibles assets of the company, not clearly identified up to day . Exploiting the build -in capacities of the platforms to keep the evidencies of each message and each event with the history of actionswill help to fulfill the enormous work to : identify, document, prove every Intangible Asset adoption conforming with IFSB reglementations.
The recent evolutions of International Financial Reporting rules can be fulfilled because we can operate automatically hundreds of thousands transactions existent on the platforms anyway, and respect the constraints to the Intangible Assets reporting.
Also, the New world of Business start to understand the Crypto-Currency and his currency-substitute position in the negotiation Fair Value, in value unit, special for each Intangible Value category.
Will be natural to understand that if we value through Fair Value unclear identified asset, but functioning with a set of others intangibles assets, incorporated at different moments, during the reporting period , at the closing date we can have a better estimation of the total package of intangible Assets like impact to the Company Market Value so our special cryptocurrency conversion in monetary units will be a well traced and documented asset automatically done, by the platforms functions.
Every “Value Contribution” to a “Value Center” is a Fair Value Transaction if the “Buyer” and the “Seller” validate the transaction value in the transaction currency.
The negotiation is not automatized, must be between two Humans in two different Value Centers, no constraints no obligation to do it, understanding the use and value of the transaction object.
IVM (Inside Intangible Value Market) is the principal Company Market and each specific platform is a level 2 Market and the organizational unit Market is a 3-level market, all these Markets are integrated and the distinction is regarding the most negotiated Intangible assets and the transactions volume.
IVM is the Firm augmented Intangible Value Business, we can see and act on the very small detail of the Intangible Value Flow, optimizing and clean the “bugs” on the value conversion circuits.
The Intangible Value is continuum Flowing, and converting from one Value-Knowledge to another Value -Competence and moving on the Tangible representation of the Intangible Value like : software, drawing, procedure, algorithm, teaching documentation & method, business process model, customer sales procedure, machine -learning procedure, mining algorithm, customer support procedure, Robot Process Automation procedure & workflow.
An Intangible Asset which is not “trade” through Value Transactions is losing a part of it’s Market Value. Conversely a little Value, for example, for the Knowledge Intangible asset, in “mining Customer process”, if we “trade” it, on the IVM (Inside Intangible Value Market) in one year will win more value, than if we don’t trade it.
Transactions frequency and volume and total conversion cycle to Tangent representation and Asset monetary conversion is Market Value for the Asset.
The IVM is like a financial equity market, with the difference that, the transactions objects are the Intangible Assets, and the fruit of the Human Capital working with the Firm Intangible and tangible assets.
Critically, companies will need to measure the return on their investment in employee skilling—for example, by evaluating how successful they have been in giving their employees new skills and comparing the cost of these efforts with how much they would have spent on hiring. Copyright © 2020 McKinsey & Company.
Let’s take the explicit Knowledge, on mining the customer support process, if we didn’t “trade ‘it, no transaction, in one year it’s value will not be the same, because it’s not updated the knowledge and the mining products and technology is moving fast. If no transaction to convert this Knowledge to a Competence Value support for training and test, means that this Knowledge has little Value for the Company, even if I considered it important at the time when it was made explicit.
INSIDE INTANGIBLE VALUES MARKET, Principle Market, is a virtual space under Company total control and responsibility, trading exclusively Intangible Values & Assets .
Value Centers are the only authorized to trade, only through Humans representing the Value Center team (at least one person ).
The Market Participant is the Value Center , Market Administration and Market Authority are the Market Governance.
Value Centers are completely independent, not hierarchical authority. To be admitted the Intangible Assets must generate Company Value, means bring Value to the others Value Centers.
Intangible assets can be proposed without discrimination to all Value Centers, the transaction value can be different per transaction ,“buyer”, accepted value depends of the value contribution to his assets .
Transaction Value is only valid, with the parties acceptance, without pressure. Intangible Assets must be, separate identifiable, under the Company total Control, the Economic Value generated by them, must profit only to the Company, and the assets cost can be determined.
Transactions results, payments and deliveries only through the Market Administration.
The trading journal with all the transactions is with the Market Administration. Market Administration will use the trading journal for indications on quoted prices for identical assets, but also to the Valuation techniques used for these valuations.
Value Center trading currencies, and their conversion rate, are fixed by the Market Authority, and will be linked to the Company Governance, depending on the Intangible Company Value Strategy.
Today a Company of 5000 Humans with a medium-high digitalization level executes 5000 to 10000 Value Contributions per day so 1 millions to 4 millions Value Contribution per year, very conservative figure, this is the documented base for 100 to 1000 Intangibles Assets obtained conforming IFRS rules, Fair Value Transactions, well and solid traced, ready for audit for every Intangible Value flow in the platforms .
Intangible Assets internal production, is now managed and is visible if executives decide so, managing asset by asset the Intangible value and the quality and productivity of the Human Intellectual capital under contract makes a new era in the Management and Governance history.
The new wave of Non-Financial Values useful in the new Business Values approach: Environment, Social, Durable, Governance, Security, Risk, Compliance can be all of them treated like Company Values generated by the respective Intangible Assets .
"ESG considerations in assessments of competitors, suppliers, or major capital markets why they don’t do so, ... most often say that available data are insufficient. Other top reasons relate to the usability of data: contributions are too indirect to value, or analytic expertise is lacking....data availability and usability as reasons for not considering ESG in assessments of competitors, suppliers, or capital projects” McKinsey Quarterly, November 2019
The Declarative Reporting based on Q&A formula with many different questions based on descriptions without a Factual substrate, just on nice “storytelling” without facts proven by the Company acts, has little impact for those investing real cash in the Company wealth, investing not financing.
"The main pillars supporting the transition to a more sustainable financial system are the measurement, verification and publication of ESG factors. It is important that the public authorities intervene, that they establish solid ESG standards and that they supervise the players and the products concerned in order to prevent the risk of greenwashing ", ESMA (European Securities and Markets Authority).
When International Integrated Reporting one of the multiple Declarative Reporting will base the declarative answers on the “value units “generated by the real “facts «executed by the Company” , then it will be solid, traced, verifiable. For this is enough to create Value Centers for the formular questions and the IVM inside Intangible Market will “count” the Intangible Value Transactions, and based on the transactions journal the IIR, declarative answer will be like ESMA president says solid, traced verifiable.
This will be a huge advance for all our Business live, because we see the Intangible Value, so we see 80% of what our Human-work-contract produce today for many Humans.
The fact that we can see and prove the link with the Company Wealth will encourage us to develop this side of our production, and we develop the cognitive power and the enormous Value creative potential behind this.
Companies will have a real mechanism to measure the Intangible production, and by Fair Value Transactions measure each Human Intangible Assets production with impact on the Company Market Value.
Being able to trace the Intangible Assets sourcing and dynamic is capital for the executive level because he finds everything through Mining along the Business Process Model or go deep mining when is a bottleneck, so optimize the Company processing capacity and “clean” the functional “bugs”.
Through the mining along the Business process and deep mining for cleaning processes the AI is ready to be a Smart Tool in the executive’s hands.
Now the Intangible Assets creation trace will help to find the Company ADN what is the competitive Advantage production or how much Intangible Market Value we produced.