It`s a question of trus

But how can companies ensure that their business partners - especially technology service providers that have high-level access to company data - hold the business`s confidential information in the same regard as the owners?

The outsourcing dilemma

There is no doubt that markets are becoming more competitive, requiring businesses to become increasingly flexible, but also more security conscious.

In order to attain - or even maintain - competitiveness, companies are encouraged to outsource elements of their business to specialist providers and stick to their core business, as one often hears.

Often the most suitable providers are already doing work with the company`s competitors.

Due to the central and costly role that technology plays in businesses of all types, outsourcing has become a fast favourite amongst forward-thinking management teams.

Furthermore, as the market`s outsource service offerings mature, business owners are becoming increasingly aware of the added benefits of contracting to a company that specialises in their specific vertical market.

Nevertheless, once a company has found a specialist with suitable expertise in the applicable vertical industry, decision-makers will often need to address the possibility of the provider supplying services - similar or otherwise - to a direct competitor and posing a potential security breach.

Do the benefits outweigh the risks?

Although businesses are expected to take risks in their endeavours, these should be finely calculated to ensure the potential benefits outweigh the threats.

In engaging with technology service providers, these threats may be perceived as too high when compared to the prospective benefits.

However, this does not mean that the option should be dismissed outright before further investigation.

Vertical specialists will undoubtedly be working with - or aiming to work with - a customer`s competitors, as this is how they gain maximum return from their own investments in skills and expertise.

And a question of ethics

Although this might be considered a direct threat to the clients, the company`s overall moral and ethical approach to business will indicate strongly whether this risk is mitigated.

Companies that act ethically in vertical markets will often recommend non-disclosure agreements with harsh penalties to their clients to set the way forward.

Companies like Siemens Business Services will also ensure that consultants who work with both competitors do not have access to the company`s confidential information.

Or if this is not possible, it will ensure that they understand the repercussions of breaking client confidentiality.