From headlines, litigation and international trade negotiations, this much is clear: trade secret theft is a growing problem. The competitive information that enterprises have invested in and labored to gain is valuable, and vulnerable.
The U.S. government and the European Union, among others, are formulating strategies and laws to address trade secret theft, but companies cannot afford to wait.
So, just how does a company protect its critical competitive information? It starts with a detailed inventory, according to a new report by CREATe.org and PricewaterhouseCoopers (PwC).
The report – “Economic Analysis of Trade Secret Misappropriation: A framework for companies to safeguard trade secret assets and mitigate potential threats” – offers a high-level view of trade secret theft, looking at its magnitude, its key perpetrators and how the threat landscape is evolving. Given that backdrop, it also provides a practical new toolkit to help companies assess and safeguard trade secrets.
It includes a detailed look at five key areas:
- Identifying trade secrets: What constitutes the company’s valuable trade secrets? Is it product information and mergers and acquisitions prospects, customer lists and data, a unique manufacturing process? Creating a detailed inventory is a critical first step.
- Assessing the threat: What is the risk of trade secret theft in the unique industry and in the areas where the company operates, including domestic and overseas offices and supply chain partners? How and by whom have others in this market been attacked? How do the company’s security policy and procedures measure up?
- Ranking value and exposure: Which trade secrets, if compromised would have the biggest impact on the operations and performance of the business?
- Economic impact analysis: What is the economic loss if trade secrets are compromised? This analysis takes into account direct losses as well as indirect impact, such as a dent in customer loyalty or company reputation, and provides a basis for allocation of resources in security.
- Enhancing security: What systems are in place to protect trade secrets? Wielding the insights and priorities from its evaluation, the company is in a position to improve security around its trade secrets portfolio throughout its management system and business relationships.
This report offers companies a way to move forward with confidence that they are addressing threats to their trade secrets in a practical and systematic fashion.
Download CREATe.org’s earlier report: Trade Secret Theft: Managing the Growing Threat in Supply Chains