How to Protect Your IP Rights While Outsourcing?

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Are you thinking about outsourcing your software development? If yes, did you ever think about how to protect your Intellectual Property when outsourcing? As far as outsourcing is concerned, protecting your IP is a big challenge. There are a lot of things to take care in IT outsourcing by protecting the IP rights in an all in one package.

Intellectual property is a major tangible asset of a company. The risks, nature, and significance of intellectual property rights may vary based on industry type. There are a number of industry types which needs outsourcing so that IP protection too. When considering software outsourcing, intellectual property protection has a vital importance in offshore or nearshore outsourcing. While outsourcing your project development process to a vendor or a group of vendors, there will be a number of intellectual properties that you should provide to them. The IPs include software, applications, data, requirements documents, trade secrets, confidential information, work authorship etc. The first thing to keep in mind on IP protection while outsourcing is that manages the IP and obey the business goals of both customers and vendors. It’s the time to protect your IP from unwanted parties and to create a risk- free outsourcing interface. We suggest the following ways for your multi-layered IP protection.

Find The Major IPs

Before you start an outsourcing process, you have to identify what are the IPs you need to protect from future risks. Your IPs would be copyrights, trademarks, secrets, mission-critical software details, confidential information etc. All these items would be arranged in databases, embedded in codes or simply written in a paper.

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Identify How Vulnerable to Attacks It Is

Next step is to identify the major attack prone things about your software intellectual properties. Check out the following things:

1.     What are the items incorporated in your intellectual properties.

2.    Location.

3.    Who manages and controls these intellectual properties.

4.    Who is the current protector of your IPs.

5.    Vulnerability scale of this IPs.

6. Appoint an IT manager to monitor transactions.

7. Appoint an accountant to audit the financial transactions of agreements.

8. Appoint a security professional to invigilate the security breaches.

When you plan for outsourcing your software business, it’s vital to protect confidential details and other critical information so as to avoid misuse, harm, loss, theft etc. Go through the following things before you select an outsourcing vendor in the perspective of IP protection.

  • Always choose an established vendor in the outsourcing market so that you can fix the credibility.
  • Ensure that your vendor has a documented security policy on IP related terms.
  • Ensure that your vendor can provide you additional security policies to protect your very complex data.
  • Engage in well-organized human resource screening.
  • Always ensure that the outsourcing vendor is documenting all your project source codes and project critical items.
  • Verify data security and IP protection practices of outsourcing vendor.

When you outsource your projects to an outside vendor, it’s a must to protect all your company related intellectual properties. Your IT compliance manager must ensure that the company has used all types of IP protection such as physical, electronical and legal. Always ensure that your company has a full-time IP protection with the following major turnarounds.

  • Never disclose all the mission-critical information to all staff. It must be limited to a high panel of members who is in connection with compliance and information security.
  • Ensure that your outsourcing vendor has a very secure channel for communication and functioning.
  • Use firewalls, VPN, encryption and other security actions to avoid security breaches in the electronic environment, which may lead to interruptions in the supply chains.
  • Protect source codes, passwords, access codes etc. from breaches.
  • Never use real information in test data.
  •  Keep an original of the source code.
  • If you are outsourcing to another country, decide which county’s legal system to use for protection.
  • Maintain the IP protection standards of both countries.
  • Keep the licensing procedures and source code ownership.
  • Always double check the issues with open source software you and the outsourcing vendor are using.
  • Ensure that all the individual staff is vigil for database protection and privacy.
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Andrew Berger from IP In Brief says that while making an outsourcing agreement, make sure the agreement provides that you will own the rights to any IP the Vendor creates during the term of the relationship; for instance, if the vendor creates any joint interfaces, you should own them. He also stated that if you are outsourcing to India or China, the vendor should register the company’s copyrights and trademarks at the right government agencies there. The IP outsourcing agreement will change based on the IP and the country in which you would like to outsource. It’s a must to keep in mind that IP and related sensitive data are highly delicate and prone to risk and security issues. The above guidelines would be a helpful thread for your IP protection while outsourcing.

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