Top 8 Tips for Protecting Sensitive Data When Working With an Outsourcing Company

Outsourcing has been a popular byword in business for many years now for several good reasons.

This solution allows you to have the permanent or temporary staff you need without going through the arduous recruitment process within a short time at a lower cost.

You can also access global talent, enabling you to diversify your workforce, and tools that can help streamline your operations.

By investing in outsourcing solutions, you can focus on your primary responsibilities without worrying about neglecting certain crucial business tasks.

With these benefits, you can expect to run a more efficient, productive and successful business.

However, there are a few things you have to do to ensure you continue having a smooth-running and reputable business while having a good relationship with your outsourcing service provider. This includes protecting your company’s and customers’ sensitive data.

Boosting Your Cybersecurity When Outsourcing Business Processes

Outsourcing usually involves sharing sensitive data with your service provider. Although this is a vital part of a smooth and successful partnership, it doesn’t mean you should take it lightly.

This means you have to ensure all company and customer-sensitive data you share with your outsourcing partner remain safe and secure regardless of how they are used and where they are accessed.


Below are some of the best tips you can follow to protect sensitive data when working with your outsourcing solutions provider:

1. Ensure you choose a trustworthy outsourcing partner.

The first and most important step in protecting sensitive data when working with an outsourcing company is making sure you work with a trustworthy, reputable partner.

Before partnering with an outsourcing company, evaluate their reputation, experience, and security measures. Ask for details about their security policies, infrastructure, and compliance with industry standards.

Additionally, read customer reviews about the company to find out if they had any cybersecurity issues.

With a detailed assessment, you can make an informed decision and work with a reliable partner that can adequately protect your data.

2. Sign a non-disclosure agreement (NDA).

An NDA or confidentiality agreement is a legally binding contract between a party disclosing confidential information and the recipient of this information.

Through this binding agreement, your outsourcing partner agrees to safeguard your confidential information, ensure its security, refrain from using it for unauthorized purposes, and disclose it to any third parties.

As such, the agreement should include clauses on data confidentiality and handling procedures and unauthorized data sharing.

A clear and comprehensive NDA outlining your and your outsourcing partner’s responsibilities and consequences should a data breach occur allows you to legally protect your company’s and customers’ sensitive information.

3. Establish clear cybersecurity policies.

Clearly defined cybersecurity policies serve as a guide for your employees and outsourcing partners to follow.

You should have clear, comprehensive security policies covering data handling, access controls, incident response and employee responsibilities.

Your outsourcing partner should have a copy of these policies and include specific instructions for them if you need to give them any.

Ensure both your employees and outsourcing partner follow these policies so that all sensitive data remains safe and secure.

4. Limit access to sensitive data.

Minimize the risk of unauthorized access to sensitive information by giving access privileges only to individuals who truly need it.

Consider implementing role-based access controls (RBAC) to ensure your in-house and outsourced team members obtain or read only the information they need to perform specific tasks.

By assigning access privileges based on your employees’ job roles and responsibilities, you reduce the risk of unauthorized individuals gaining access to your sensitive data.

5. Create a data breach response plan.

Even if you already have preventive measures, you need to have a well-defined data breach response plan in place.

This response plan should outline the steps everyone needs to follow if a cybersecurity breach occurs.

These steps should include immediate containment, investigation, notification of affected parties and cooperation with law enforcement.

With this response plan, you and your team can take immediate action to mitigate the impact of a data breach within the fastest time possible.

If you don’t have a cybersecurity or data breach response plan yet, create and implement one as soon as possible. It may be time to think about digital transformation as well.

6. Implement multi-factor authentication (MFA).

MFA or two-factor authentication (2FA) is a login verification method wherein a user needs at least two different factors of proof to sign in to a device or database.

These verification factors can come in the form of a unique code sent to the user’s mobile device or email, the correct answer to a secret question, or biometric authentication, which they have to provide after inputting their password.

The additional layer of security is an effective way to prevent unauthorized access to sensitive data since the multiple forms of authentication make it harder for unauthorized individuals to gain access.

7. Encrypt sensitive data.

Data encryption is a process wherein information is encoded and can only be accessed, read or decrypted with a correct encryption key.

A person trying to access the encrypted data without the right encryption key will only see scrambled or unreadable information, which is also known as ciphertext.

Encryption is a recommended process for highly sensitive data. Whether the information is at rest (stored in an internal or external storage device) or in transit (being transferred between locations via the cloud or over a private network), use strong encryption algorithms.

With data encryption, you can ensure sensitive information remains unreadable and unusable even if an unauthorized person intercepts or steals it.

8. Conduct cybersecurity audits and update and patch systems regularly.

Regular cybersecurity audits help you and your team identify vulnerabilities and weaknesses in your data protection measures.

Because of this, you need to conduct audits regularly to assess the effectiveness of your company’s security controls, identify gaps and take corrective actions promptly.

A cybersecurity audit usually involves penetration testing, vulnerability scanning and assessing compliance with security standards and best practices.

Additionally, outdated software and systems are typically more vulnerable and easier for hackers to attack.

You can protect sensitive data and prevent a cyberattack by keeping all systems, applications and software you and your team use up to date with the latest security patches and updates.

You would also do well to implement a patch management process to ensure timely updates. It involves identifying, testing and installing software patches or updates to the devices you and your team use.

This patch fixes existing bugs or vulnerabilities in the software, adds new features and boosts its security.

Regularly updating and patching your system can address any known security vulnerabilities and reduce the risk of a cyberattack.

Protecting your company’s sensitive data when working with an outsourcing company requires a proactive and multi-faceted approach.

When you follow these tips, you can maintain the confidentiality, integrity, and availability of your sensitive data while working with your outsourcing partner.