Many companies around the world owe their success to some sort of trade secret. Whether it’s a special ingredient in a grandma’s recipe, a unique knitting technique, or a closed-source software tool, safeguarding that secret is what often gives those organizations a competitive advantage.
While certain laws protect intangible assets – including trade secrets – in the United States, companies must take extra precautions to protect their valuable assets. For example, they should adopt appropriate measures and ensure that all employees do their part in protecting trade secrets.
This article lists some best practices for protecting your company’s trade secrets. In addition to identifying what needs to be protected first, you also need to label protected documents, secure computers, develop a business continuity plan, and implement employee training programs and policies.
Here’s everything you need to know to protect your company’s most valuable secrets from the prying eyes of the competition.
Identify and protect your trade secrets
The first step in protecting your company’s trade secrets is to identify what needs to be protected. Keep in mind that trade secrets can be anything from a customer list and marketing strategy to a manufacturing process, specific HPC cloud software or a chemical formula. The things you might want to keep to yourself will usually be different from the things your competitors will keep locked away.
Once you’ve identified your company’s most valuable information, you need to take steps to protect it. This typically means placing assets under physical and technological security, as well as developing policies and procedures to control access to that information. For example, if you have a customer list, you might consider storing it in a locked filing cabinet or password protecting it on your computer.
Monitor where you store information
Once you have identified what needs to be protected, you also need to monitor where your organization stores the information and who has access to it. For example, if you have a prototype of a new type of 3D printing machine, you need to know what’s happening at all times.
Where is it stored? Do your employees use it for marketing purposes? How many people know of its existence? Are the employees who work there allowed to share information about it with other employees?
By monitoring where your business information is stored and who has access to it, you can better control who has access to it and ensure that it is only used for authorized purposes.
Label protected documents
Another essential step in protecting your company’s trade secrets is to label protected documents. This will help you control access to these documents and ensure that only authorized people have access to them.
In many situations, this is what makes or breaks your business in court. For example, if you are unable to prove that a particular document was confidential at any given time, the courts may decide that you cannot claim it as a trade secret.
That’s why your employees need to understand what needs to be protected and what isn’t. The only way to ensure confidentiality is to put some sort of label on the document itself. You can put a watermark, stamp, or some other kind of “identifiable mark” on it. For example, if you have a file that needs special protection, you can label it “Confidential” or “For authorized use only”.
Securing computers is an essential part of protecting trade secrets. If a portable storage device containing confidential information is stolen, it can pose a significant threat to your business. Therefore, you must do everything to protect the computers used by your employees.
Using strong encryption software to store sensitive information on hard drives is a great decision. You should also update the anti-virus solution installed on company computers to ensure that no malicious software can steal data. Additionally, you should install a firewall to prevent hackers from accessing the network and stealing files.
You may also consider storing your assets on a secure server accessible only to authorized persons. This way, only a designated group of people will be able to access it.
Develop a business continuity plan
Have a Business Continuity Plan (BCP) in place is one of the best ways to protect your trade secrets. This plan should outline how your business will continue to operate in the event of a disaster, such as a fire or flood.
For example, if your company building burns down, your BCP should contain instructions on how to access all of your vital data and other records, as well as where to keep them during the rebuilding process. It should also have a list of people who have access to this information and their contact details.
Some of the most important elements to include in a business continuity plan are:
- an inventory of your business critical information and where it is stored,
- a backup plan for this information,
- a plan for how your business will continue to operate if this information is lost.
BCPs help organizations make critical information accessible even in a crisis. So create one before you find out it’s already too late.
Implement employee training programs
A employee training program is one of the first things you should focus on when it comes to protecting trade secrets. Training your employees on what information they can disclose and what they must protect is a great way to ensure that they won’t inadvertently divulge your organization’s secrets.
Most employees don’t realize that they might be leaking material information without even realizing it. A training program helps them understand their obligations and the consequences of disclosing a company’s trade secrets.
In your training program, you could include information about the penalties for sharing company secrets and emphasize the importance of keeping this information confidential. You can also address other topics, present examples of good and bad practice or give a brief overview of current projects that are strictly confidential.
Establish policies and procedures
As mentioned earlier, your employees need to understand the risks an unprotected secret can pose to the business. You should also make sure they know what actions they can and cannot take regarding a particular secret. Implementation of policies and the procedures can help you do this.
You can use these policies and procedures to describe how employees should handle your company’s trade secrets and other confidential information. For example, you might want to prohibit people from using specific information in their personal projects (including side projects) or other companies, even if they quit.
Having such protection protocols in place will give you peace of mind knowing that your business secrets are well protected.
In many cases, your company’s trade secrets are the main reason for its success. But, to protect this information, you must take the appropriate measures and ensure that all of your employees understand how important it is to keep your company’s trade secrets to themselves.
For starters, you might want to consider storing your most valuable assets in a locked filing cabinet or password protecting them on your computer. You may also consider labeling protected documents and implementing employee training programs and policies. Additionally, developing a business continuity plan and having trade secret protection protocols in place are also great ideas.
Follow the steps outlined above and enjoy full control over your company’s trade secrets. Good luck!