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Signing an NDA is key to outsourcing software development

June 17th, 2022

 

Trust is a cornerstone of any good relationship. That applies both in a personal context, as well as in a business one. It is hard to imagine any successful relationship that does not have trust at its very center.

 

It is, therefore, essential that when your company is considering outsourcing software development requirements, it feels reassured that it is entering into a relationship that has trust at its core. One of the key elements that can deepen the level of trust between two parties in a business arrangement is a Non-Disclosure Agreement.

It is essential to bear in mind that being asked to sign an NDA should not be taken as a slight on anybody’s professionalism or honesty. Signing an agreement to protect your company’s confidential information, its data and intellectual property, is an entirely standard part of a new partnership. Accordingly, it is unusual and worrying if you come across a provider who refuses to sign an NDA.

At such a moment, that precious commodity called trust is lost – and you will be entirely justified in refusing to proceed any further with an entity that raises objections to such a natural step.

 

Data protection and NDAs

 

What are NDAs?

NDAs are legally enforceable contracts that cover the interactions between two or more parties in a business arrangement. By signing them, you give each other reassurance that any of your company’s confidential information that is shared during that arrangement will go no further – and no commercial harm will come to your enterprise as a result.

You should expect all such confidentiality agreements to include a definition of the obligations all parties are under once they sign. They should also include clear definitions of what constitutes confidential information, as well as the length of time that the agreement will cover.

NDAs should feature examples of what a breach might look like – and a clear statement of the consequences of any breach. By the time you sign one, you should know exactly what information needs to be kept completely secret – and the consequences if it is not.

 

Why are NDAs important?

There are several reasons why NDAs are a key element of any new partnership – particularly in an arrangement as key as outsourcing software development. The principal benefits are:

  • They ensure you are safe to engage and deepen your relationship
    When you invite a contractor or service provider into your territory, it is inevitable that the day-to-day working relationship will involve them having access to your company’s confidential information.
    It is hard to conceive of the circumstances in which a business or individual to which you are outsourcing software development would not gain access to any commercially sensitive data – unless they were engaged in an extremely minor or peripheral project.
  • They guarantee the safety and confidentiality of your ideas
    All businesses create and retain ideas – about how they operate, about their staff, and most compellingly about their present and future products. If that intellectual property were to find its way into the hands of a rival in the same sector, it could be commercially disastrous.
    Accordingly, an NDA can be seen as a software confidentiality agreement – all the projects you are working on, and all the data associated with them, should be completely protected.
  • They ensure your new products have the impact you want
    Imagine the negative consequences that could result if one of your competitors found out what you were working on. If they knew the results of behind-the-scenes testing of your latest project.
    When you are outsourcing software development, you need to be sure all the data associated with that process remains unshared with the outside world until the process is complete and your new product is fully tested, refined, and ready to launch in the market.

 

Conclusion: Don’t trust a provider who won’t sign an NDA

business man signing an NDA

 

 

Given the importance of NDAs – and the crucial consideration that they are a standard business practice – it is hard to understand why any operator would be reluctant to sign any confidentiality agreements.

It bears repetition that being asked to sign an NDA is not an indication that a business does not trust you. All it displays is an understanding that some of the company’s confidential information is likely to become available to you, and that you should not be sharing that with parties outside the arrangement.

NDAs help to keep your commercial secrets for you. They should prevent the theft and dissemination of a company’s data and intellectual property with anybody outside the immediate arrangement.

At ZirconTech, we understand the importance of giving and receiving trust, and are always perfectly willing to sign confidentiality agreements with a company outsourcing software development to us. We would see it as highly suspicious and irregular if any potential partner refused to sign an NDA – we suggest you should too.



 

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