It’s common knowledge that patents, trademarks and copyrights are all forms of intellectual property that can be protected by the law. But there is another, less well understood category of intellectual property, and that’s trade secrets. What are they exactly and how can you protect yours?
Trade secrets can be recipes, procedures, customer lists, expansion plans; in short, anything giving you a leg up over the competition that you want to keep strictly to yourself. They are things that differentiate you from your competitors, and if leaked, could cause harm to your business.
Consider implementing these steps to protect your company.
- Make a list of anything you think is a trade secret and put those things in order from the most precious to the least precious. Consider what the risk of loss of any of those items is. Think about what losing them might cost you in terms of money, customer loyalty, and even the survival of your business. Determine to protect them.
- Create policies around keeping these things well guarded. This can be as simple as keeping important papers in locked file cabinets or marking things “Confidential.” You need systems that help you (and your employees) guard these secrets effectively, so be intentional about the process.
- Limit the number of people who know the secrets or have access to them. Make careful decisions about who knows what. See if you can’t divide a secret into pieces so that fewer people know the whole thing.
- Educate your employees as to the importance of your trade secrets and what losing them will mean to the company and to their jobs. Include your confidentiality policies in your employee handbook. Do on-going staff trainings around the proper ways to talk about, and handle your secrets.
- Ensure confidentiality by having any employee with access to proprietary information sign a nondisclosure agreement. This document should spell out very clearly what the information is, how to handle it properly, and what will happen to the employee if these procedures are not followed. Help your employees help you by laying it all out in writing and getting their buy-in.
- Use nondisclosure agreements when you’re negotiating deals with suppliers or potential customers. The “NDA” should include which information is confidential, limits to what the other party may use it for, and how long the information needs to be kept under wraps. Also, make sure that any copies of the information are returned to you at the end of the specified term.
