"It is impossible for ideas to compete in the marketplace if no forum for
  their presentation is provided or available."           Thomas Mann, 1896

The only way to find fraudulent parts and products is by systematic planning, searching and evaluation. The blood hounds may get you to a spore track but you have to be prepared to analyze the options. This means not only good deep data but an agile process for detection, confirmation as in testing whether a product is original or a knock off (some knock offs actually work while others are placebos at best). The goal should be revenue recovery not just coming to know where an enterprise has lost advantage. This means finding and recovering revenue from counterfeit and gray market practice. When we are confused we often call for a map.

Where is the map?

The solution to these problems asks for more than a bloodhound. It calls for a revenue recovery process roadmap, and can ask for a partnership as well. Both are available in a combination of Corporate Risk International (CRI) and New Momentum. The roadmap consists of a revenue recovery structure that consists of: visibility, plan development, plan implementation, and the measurement of results. We will examine this road map in detail with helpful commentary from Tom McWeeney, who is the senior VP of CRI. CRI is a midsized investigative company in the revenue recovery business and the crisis management business. It specializes primarily in the IT, pharmaceutical, and Law arenas. Tom McWeeney says, "We feel CRI is more agile than some of its competitors. We are able to work with our clients and offer customization and beyond the normal and available open source domain."

Visibility

Step one on the map is a concentration on visibility. That means visibility into the counterfeit and gray markets that require seeing who is doing what where and how much. This search can isolate data that weeds out duplicate offerings, separates the players (counterfeit, gray, suspect, etc.) and formats this information into meaningful metrics and this is exactly what CRI does and with New Momentum’s help. Tom McWeeney says, "They drill down not like a Google search or other search companies. New Momentum takes it to the next level, and takes it to a dashboard and beyond to compilation. When people in this business are exposed to New Momentum’s solution their eyes are opened."

It is estimated that the sales of counterfeit products worldwide hovers around $600 billion a year.

Step two in revenue recovery is to develop a plan. When CRI works with a client they would expect them to subscribe to New Momentum’s Enterprise Brand Intelligence and thus establish the means to have the visibility and the intelligent data structure for creating a plan. Many organizations underestimate the significance of the proper plan development. The more time and effort the enterprise places in creating a comprehensive plan the better the implementation and results. Like any strong plan, the enterprise will need to set goals and measure frequently. Its goals need to be realistic and cover a one to two year timeframe. A concentration on due diligence investigations comes next. McWeeney says, "Our due diligence investigation has New Momentum input. Each company we investigate for has a different system and we work back and forth with them in a customized manner." An enterprise will want to plan every aspect of its program including test purchases and due diligence. After reviewing the data, they will decide exactly how they will go about approaching the seller that can lead to a buy. Initial questions that need to be answered include: Is this a massive problem? Is it long-term? How much does the enterprise want to buy it for? What quantity will allow it to become evidence if the enterprise decides to take civil/criminal action? Do they need to purchase at a certain price? Is there a price that will strengthen their role as evidence in future civil/criminal action? Should they get customs, FBI, Customs and Border Patrol (CBP), and Immigration & Customs Enforcement (ICE) involved?

Implement plan

The third map step revenue recovery is an implementation plan that carries out the conclusions of the planning process. During this activity Tom McWeeney says, "We use New Momentum for actionable intelligence. This leads to whether to do buys or not. New Momentum provides that critical data background." With the right information as background, the implementation is ready to begin. In this phase, the enterprise will need to prioritize targets, follow-through on plan, and incorporate the ability to consistently add new data that could alter the actions that are to be taken. The enterprise should not be afraid to outsource certain parts of their implementation to corporate risk specialists to the extent that such a decision makes sense. With a comprehensive plan in place, the enterprise (with assists from CRI and data and analysis from New Momentum) can start assigning due diligence investigations and conduct strategic under cover test purchases in regard to high volume targets. This process identifies whether the subject in question is legally registered, has a history of counterfeiting, or has a questionable general business profile. This step may also include engineering analysis, civil action, and criminal action. The enterprise may want to do some of this work with inside capabilities but outsourcing is a viable alternative. When doing a test purchase, CRI recommends a wire transfer because it allows the enterprise to have access to valuable data on the counterfeiter’s financial institution. This information may be helpful when taking civil and criminal action. Engineering analyses of test purchases may lead to civil actions (cease and desist letters, lawsuit, etc.). The outsourced undercover purchase of a product or part may require setting an undercover company. When engaging in pursuit of criminal action there may be a liaison with FBI, or CBP and ICE or all three. Whatever actions are taken need to be coordinated in-house and outside counsel. In the long run purchasing may require re-purchasing to ensure that the counterfeiters have actually ceased their illegal activity.

Measure results

"When people in this business are exposed to New Momentum’s solution their eyes are opened." Tom McWeeney| The results have to be presented to enterprise management. At the customer’s request, New Momentum can implement a monitoring process around an analysis designed to produce a standard set of outputs that are ‘meeting’ or ‘boardroom’ ready. Armed with these outputs, an intelligence group can attend high level or even board level meetings to discuss changes in the gray market landscape, new brand, IP, or counterfeiting risks which may be appearing. These risks can then be reduced with follow up or on-going legal action and an overall strategy for setting priorities based on product families or technology groups. These reports, which are provided in both a summary and detail level, consist of: trending charts across all product families; by customer assigned product family types showing change in market activity; by individual part or part family within the product family; by geographical region for quantity, number of buy/sell offers and number of new companies interested in the customer’s products. The reports also include top ten-style rankings of individual companies who trade in the largest quantities of the customer’s products and who do the most number of transactions, regardless of total quantity. All of the summaries and analytics above can always "drill" back to the original open market buy/sell transaction that contributed to the total or summary. This data is maintained historically and archived so that as patterns of activity or risk emerge in the analytics, record by record research can be done back to the original time period where the pattern started.

An ongoing activity

Protecting brands and intellectual property is not a once in a life time event. It is an ongoing activity. The steps above make it clear that an enterprise has to first understand its problem and then it must develop a plan to mitigate the problem and this means getting a management buy-in. Given the go ahead the plan must be implemented and after the findings and action the plan should be evaluated for its effectiveness. With the data the New Momentum solution provides, a customer can approach partners who are selling unauthorized products, brokers buying and selling on the gray market or companies buying/selling counterfeits and makes an effort to turn them into legitimate distributors selling authorized products at the appropriate price and quality levels. The result can be that the violators either become authorized distributors or they know they’ve been found out, and they cease operations. By way of review a New Momentum solution builds specific search agents that empower organizations to search hundreds of thousands of pages per night including open market web servers, franchise web servers, gray market sites and even trade board email blasts.  

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