Introducing TS25

What’s a Trade Secret?

Trade secrets are valuable assets that derive competitive value from secrecy 
and require protection by reasonable efforts. This includes all of a business’s confidential information that provides some competitive advantage.

The Uniform Trade Secrets Act (UTSA) defines a trade secret as information, including a formula, pattern, compilation, program, device, method, technique, or process that:

• Derives independent economic value, actual or potential, from being generally known to the public or to another person who can obtain economic value from its disclosure or use.
• Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

We haven’t had any problems. Why should we implement a Trade Secret Protection Program (TSPP)?

Compromise of a company’s secrets usually happens without notice. Has your organization tracked and documented its most competitively sensitive information? Do your employees know the basic rules for avoiding trade secret loss during product demos, marketing pitches, or customer/partner meetings? If you answered “no” to either of these questions, your company’s information assets, like many businesses, are exposed to risks you aren’t aware of. Identifying and properly managing your trade secrets greatly enhances your ability to discover hidden problems and protect your rights.

We already file patents. Why should we also be concerned about trade secrets?

Trade secrets are critical complements to patents in any IP protection plan. Not everything is patentable, because of the subject matter and non-trivial costs of patenting. Patents are published for the world to see; many businesses prefer the secrecy and non-discoverability of trade secrets to protect critical aspects of their most highly valued innovations. Leading companies across industries, including technology, healthcare, finance, manufacturing, and retail, pursue a hybrid IP approach. This combines pursuing patents for readily discoverable innovations and documenting trade secrets to protect information that’s typically unpatentable, like customer lists, pricing strategies, and supply chain logistics. Trade secrets also include potentially patentable inventions the company prefers to keep secret, like process technology.

What benefits do we gain from implementing a Trade Secret Protection Program?

A TSPP dramatically diminishes the risk of loss or contamination through hiring or third-party relationships. Such losses can be irreversible and devastating to a company. The escape of trade secrets by public disclosure or “oversharing” with outsiders can place the company at a significant competitive disadvantage or cause severe reputational damage. Trade secret litigation is expensive and distracting. By documenting and placing value on the company’s most treasured IP, the CEO and CFO can gauge the return on product development investments, transforming R&D from a cost center to a profit center.

Can a Trade Secret Protection Program add tangible value to a company?

Yes, a TSPP ensures that valuable information is properly documented, protected, and managed in a way that directly contributes to the company’s bottom line. Companies that fail to identify and document their secrets have no way of assigning value to them. Identifying the information that differentiates your company and affords you a competitive advantage is a necessary first step.

Trade secrets exist everywhere. How do we get our arms around this, and what if we don’t have the time or resources?

Start small. First, identify the personnel/groups in your organization that either produce innovation (typically engineering, R&D, IT, and product groups) or manage it (usually business development, sales/marketing, HR, legal, operations, and compliance). Next, build an action plan that does three things: 1) Guides managers to document their most competitively sensitive information; 2) Designs measures for risk reduction; 
and 3) Communicates expectations to the workforce, particularly through confidentiality training. This plan is easier to execute than it might seem, and the benefits will soon be apparent.

How do we manage a process like this without disrupting our business or negatively impacting our culture built on speed and collaboration?

Creating a TSPP that fits your organization’s needs and risk environment can be accomplished in a way that respects and serves your culture. There’s no one-size-fits-all approach and various ways to enhance information security without interfering with valuable collaboration or creativity. Rather than slowing things down, a trade secret policy creates a clear path forward, helping teams act more effectively by following transparent guidelines and exercising good judgment.

Our senior leadership and board are pressed for time or may not see the value of a 
Trade Secret Protection Program. How do we bring them along?

In today’s digital-first world, analysts have determined that the intellectual assets of a company account for 90% of its overall value. Senior management is responsible for identifying and managing these assets to preserve and monetize them. Caring for trade secrets does not require a massive effort and can be accomplished as part of the company’s risk management program. As businesses digitize and operate in global markets, the risk of data leakage increases, making it imperative for leadership to be proactive. IP protection, including trade secrets, has become an outsized compliance risk for company executives and their boards. A robust Trade Secret Protection Program doesn’t just mitigate risk; it signals to investors, customers, and regulators that your company is serious about safeguarding its most valuable assets.

Our company is a small-to-medium-size business (SMB). Should we have a Trade Secret Protection Program?

Yes, studies show that SMBs rely more on trade secrecy than any other kind of IP. The TS25 s tandards’ core audience includes new entrants, start-ups, and smaller organizations that will benefit from simple, actionable guidance to enable the creation of a basic TSPP that can grow with the company.