The intricate link between trade secrets, data protection and client satisfaction

Data protection concept.

I watched an interesting movie where one of the characters had their business sabotaged by their assistant. The lady in the movie trusted her assistant so much that she gave out all the crucial business information including client data.

The assistant, full of greed and malice, opened a competing business and contacted the clients. She then began diverting them to her new business. She maligned her former boss, insinuating that she was incompetent and lacked the capacity to serve them. Luckily, she was caught in the act and fired before she could fulfill her wicked plan.

This is just one of the many examples of data breaches from unfaithful employees. Not only does the business suffer setbacks, but the clients may also be exposed. In almost all sectors, the maintenance of client confidentiality is one of the key considerations of customer attraction and retention.

In more sensitive sectors, client confidentiality is regulated as any breach may be very damaging to the client. Businesses handle a lot of customer data including identity, and contact details among others pertaining to the customer as well as the service being offered.

Customer confidentiality is protected under several laws. These include the Constitution where data privacy is a constitutional right. It is also a statutory right, due to the enactment of the Data Protection Act which contains stringent data protection provisions. Businesses are required to undertake certain internal compliance measures to ensure that the data rights of their customers are upheld.

Data protection and privacy compliance can be used by businesses to attain a competitive advantage over their competitors in several ways. One is that data privacy can be used as a marketing tool, especially in businesses where data privacy is a critical success factor. Some customers would be more attracted to a data compliant. Data compliance boosts customer confidence.

Data protection can also be used as a tool to attract funding and partnerships. Compliance is a critical success factor in attracting donor funds. For many donors, it is compulsory for their targets to be data-compliant. Donors and partners give out a lot of data and they would feel more secure funding a data-compliant business.

Getting data compliance certification is done through the regulator’s office. Prior to issuance of certification, a business must establish that it has put in place the right technology to guard against data breaches. In addition, it should also establish that it has the right processes, policies and practices to safeguard data privacy.

One of the practices businesses can adopt to enhance data protection is “trade secrets’’. A trade secret is a type of intellectual property right and includes any business information that helps the business attain a competitive edge. The information includes formulas, recipes, business methods and client data.

Trade secrets will provide additional protection over client data. Businesses should adopt systems and procedures to safeguard client data. For example, limiting access to client data to only those staff who deal with client-related issues.

The staff should sign non-disclosure agreements to secure client information and client data. In the event there is a breach such as was the case in the movie above, then the business can take legal action. Businesses that handle very sensitive client data can encrypt the client identities.

Ms Mputhia is the founder of C Mputhia Advocates | [email protected]

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