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Performance and Accountability Report Fiscal Year 2007
Management's Discussion and Analysis

Table of Contents | Management | Financial | Auditor | IG | Other

Management Challenges

The USPTO will continue to lead the world in IP policy by optimizing patent and trademark quality and timeliness, and improving IP protection and enforcement domestically by addressing the following challenges:

Make Efficiency Gains for the Future, While Keeping Quality High

The Patent organization’s biggest challenge is to address the growth of pendency and the backlog of patent applications waiting to be examined while maintaining high quality. The Patent organization must address the dual challenges of rising workloads and a shift of applications from traditional arts to more complex technologies. To address rising workloads, the Patent organization will continue to hire, train and retain additional examiners, and explore and implement process improvements. Quality, which is a critical component of the USPTO’s 2007-2012 Strategic Plan, will be ensured throughout the patent examination process.

The Trademark organization’s biggest challenge is to maintain first-action pendency between 2.5 and 3.5 months on a consistent basis, given the monthly fluctuation and unpredictability of projecting new filings. If the Trademark organization can maintain first action pendency at that level, it can also ensure low disposal pendency as well.

Continue to move to an Electronic Workplace

The Patent and Trademark organizations are moving rapidly to eliminate paper documents from their processes. Electronic communications are improving, encouraging more applicants to do business electronically in using Web-based systems. Both Patent and Trademark organizations have made significant progress in support of the long-term goal to create an e-government operation. The Trademark organization now relies exclusively on data submitted or captured electronically to support examination, publish documents, and issue registrations.

The Trademark organization still has the challenge of completing an electronic docket and file management system for the operations that support core examination and post-registration to link all operations and processing. A fully electronic workflow will allow the Trademark organization to better manage the fluctuations in filings and be more efficient, as well as timely, in processing and responding.

This increased reliance on electronic systems presents other challenges to the USPTO in the event of an unplanned outage or disruption in processing. To address this need, the USPTO has embarked on an aggressive, phased business continuity/disaster recovery program. The current phase involves establishing a remote data bunker, which stores backups of mission critical data. Subsequent phases of the project will establish an alternate processing center, which will serve as the main processing site for some systems and the development and test site for other systems, and eventually allow for near-real time recovery of systems and data.

Strengthen Global Intellectual Property Rights (IPR) Systems

An effective IPR system is important to trade because it provides confidence to businesses that rights will be respected and that profits will be returned to IPR holders. The tremendous ingenuity of American inventors, coupled with a strong IP system, encourages and rewards innovation and helps propel the economic and technological growth of our nation.

The challenges to maintaining an effective IPR system include deepening the dialogue on global IP policy, facilitating technical cooperation with foreign countries, surveying and exchanging information on the current status of IPR protection and administrative systems, and arriving at agreement on standards of enhanced IP enforcement. These standards of enhanced IP enforcement include increased criminal and civil protection, as well as tighter controls on circumventing technological protection. Reaching bilateral and multilateral agreements will require all sides to openly communicate and strive toward a more global convergence of patent and trademark standards.

Sustain a Funding Stream

Permanent enactment of the fee changes made by the Consolidated Appropriations Act, 2005 is necessary to provide a stable and predictable funding stream for the Agency. In the United States, demands for products and services have created substantial workload challenges in the processing of patents and trademarks. Permanent enactment of these fee changes and continued implementation of strategic initiatives will address these challenges. Long-term funding stability is essential to the creation of a predictable environment for planning purposes.

Additionally, the USPTO seeks specific authority to eliminate, set, or otherwise adjust patent and trademark filing and processing fees subject to appropriate oversight and comment by the Patent Advisory Committee, Trademark Advisory Committee, stakeholders, and Congress.

Acquire More Talent

The USPTO work is highly technical in nature and requires a highly educated, well credentialed work force. This presents the Agency with employment challenges as the Agency faces increased customer demand and the need to recruit in a highly competitive environment, particularly for patent examiners and IT specialists.

The USPTO also needs to focus on ways to manage the new generation of employees, in an increasing virtual workplace. Although the Agency has strong performance management processes in place, the USPTO faces the management challenge of keeping younger employees – many of whom are or will be working remotely — feeling engaged, motivated, and wanting to remain with the Agency. The USPTO needs to provide more and better training in supervision, management, and leadership, while keeping the work force current with all the latest technology.

The Agency also needs to address succession planning by identifying and developing future leaders. The significance of our mission, excellent benefits, and wide use of telework and other employment flexibilities make a good business case for marketing the USPTO as an employer of choice.

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