A Non-Disclosure Agreement (NDA) is a term which describes a pact between two or more parties. It is used to limit the original members from telling the information to someone else or to someone who is not part of the initial agreement. Such an agreement is usually done to make sure that important information is not leaked or is made public. Such an agreement is necessary to use when trade secrets are discussed and is used when a new and previously not known technology is used. Usually, this type of agreement is signed when organizations are in practice of using the concept of outsourcing.
Outsourcing is somewhat of a new procedure where organizations are looking for cheaper way to get their work done. Outsourcing can be either Near-shore or Off-shore. The major difference between the two methods is based on geography. In near-shore outsourcing practices, an organisation looks for closer partners to work with. Partners with which the outsourcing firm shares the same time zone, language and work standards are preferable. In contrast, when offshore outsourcing is used, firms work with partners who are in a completely new region which follows a different time zone and has different working standards. Firms when using the concept of outsourcing for software development need to share important information with their partners and trust them that the information will not be leaked or made available to a third person. In such case, outsourcing firms usually ask their outsourced partners to sign an NDA. The importance of following such a practice is high because companies, while outsourcing, allow outside employees to go through private details of the firm like information about the company’s shareholders and the type of technology and working methods they use. If such information is made public, competitors and rival firms can significantly benefit from it.
Companies using outsourcing partners to develop software for any purpose are more careful and usually ask their offshore software development partners to sign a NDA form. Obviously there are threats in offshore software development and these firms must be careful of virus attacks or being a victim of counterfeiting. In some cases, firms ask their outsourcing partners to develop certain software to operate machinery or equipment which is new and not many people are aware of it. This technology may be part of the firm’s strategy and the organization does not want that information be disclosed. In this case, having a NDA with the outsourced partners is critical as they are aware of what information they cannot disclose to an external source. Furthermore, the benefit of using a NDA is that it makes sure that there are no communication gaps between the two partners. Everyone is aware of their roles and they know what is right and what is wrong. This allows the entire work procedure to run smoothly without any unnecessary stoppages.
Lastly, for those businesses that are using outsourcing to develop their company software must be aware about the use of NDA. Through an NDA, they can limit the use of their outsourcing partner and restrict them only towards the actual job they are hired to do. The outsourcing organization can always be in control when using NDA. If something goes wrong through the use of NDA, the firm can control the damages. Also the outsourced partner is aware of the legal cost if they break the pact. Therefore, it is good that firms who use outsourcing partners make a NDA and get it approved by their partners. Businesses that are in the information and technology industry are now adopting the use of NDA as outsourcing has become a common practice.
Mindfire Solutions has already carved a niche for itself as one of the premier vendors offering offshore software development services to its SMB clientele and help them excel in their core business. If you are interested to hire the expert software services of this 16 year old organization then do send in a mail with your requirements to sales at Mindfire Solutions dot com and we will get back to you in 72 hours.
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