If you have never outsourced a service for your company, we might need to profile you or have an interview with you. Superhuman, how do you get everything done yourself? Oh, you don’t ?

Outsourcing has come to stay.

As a business owner, you cannot do everything by yourself,  neither can your employees. Okay maybe your employees can, but having too many of them on your payroll will tell on your balance sheet at the end of the month.
Let’s look at some of the pros of outsourcing:

 

1. Cost factor, of course

In reality, this is the reason a lot of business owners consider outsourcing in the first place. Hiring for every role on a full-time basis is quite expensive. Employers get to cut the cost of taking on a new employee and still get the job done. Of course, the point is to look for the best hands for the price you can afford and not necessarily going after the lowest priced person.

 

2. You get a pool of skill set to fish from

You may pride yourself on having the creme of the industry as employees in your business, but the truth is there are a gazillion that will still elude you. What outsourcing does for you is that it gives you the ability to determine which skill set is lacking in your company.

 

3. And you get to save time

There are times you need particular skills for specific one-time projects. Instead of getting new staff for that particular project, the wise thing to do would be to outsource all or certain aspects of that project until the project is complete. Not only does this save you time it also saves you money.
Having established that outsourcing is a brilliant idea, the challenge then becomes how do you protect your intellectual property?
Not to make you wary (okay maybe a little bit), but do you know:

the person who literally puts their fingers on the keyboard and creates or does any work  is the “author” of that work and owns the copyright to the work?

So for a business that has outsourced its software development, which most businesses do, how do you protect your business and stop yourself from unknowingly giving out your software to your developer?

 

1. You know what you are outsourcing

Really, how do you protect your Intellectual property if you don’t know what you are outsourcing? The first step for you should be to know what you are choosing to outsource. “Identify what your IP really is, who owns it and who controls it.

 

2. Identify the right developer for you

This involves checking out the developers, their reputation and whether they are a good fit for the project you have in mind.
You should also make sure the selected developer has all needed resources to protect your IP from theft or unauthorized use.

 

3. Most importantly, pay attention to the key provisions in your contract

Don’t just draft up a contract without taking note of the following essential details:

A. If a non-disclosure agreement (NDA) has not been signed, include a confidentiality provision in the contract. That way, the developer is restricted from sharing any of the information provided by you, the internal workings of your business, components of your software or program and other things you specify. If you’d rather go for an NDA, however, we can help with that.

B. You have to own all IP rights. The reason for this is simple. As mentioned earlier, (s)he who authors the code (work) owns the code (work), so you want to make sure you have that eliminated with an IP assignment clause included in your contract.  The clause assigns the IP to you, making you the owner of the IP during and after your contract. This also gives you the ability to license your IP to third parties.

C. Your contract must state clearly how you want the developer to protect your IP. This should include, who will have access to it, under what circumstances, etc.

D. Spell out the termination clearly. This is a no-brainer. You know at some point, the relationship will have to come to an end, either because the transaction has been concluded or before the transaction is concluded for some other reasons. Ideally, you should spend time hashing out under what circumstances termination can occur, what happens after termination, and how to ensure you own your IP.

E. Have control of your source code. It could be a nightmare, running after a developer after completing a job to tell you how to access your source code. Some may call it bad faith, but you know it’s courting peace. If there is a dispute or disagreement, you have control of your assets and there’s nothing the developer can do about it.

F. Make sure you don’t pay for your developer’s mistakes. You should be indemnified by the developer in case he infringes on a third party’s IP right in the course of working on your own software.

In as much as outsourcing is meant to relieve you, if not handled in the right way, it can do more harm than good.
In addition to the contract, make sure you copyright all source codes and design either in your name or company name. In Nigeria, software is considered literary work and can be protected under the copyright act.  If you’d like to copyright your software, we’ve got you.

Clarity is quite relevant with IP rights especially if you are looking to use the software or outsourced work as part of other projects you are looking to sell or license. Any smart buyer or licensee will insist you provide a warranty that you own the software or other work fully and legitimately.