Are NDA's - Non Disclosure Agreements - Necessary Between Technology Vendors?

I have always accomodated a request for an NDA with the confidence that my own moral compass would steer me in that direction anyway.  Of course my policy of only doing business with friends makes my decision easier, however, as new friends are added I understand that trust might not be reciprocal in the formative stages of our relationship.

I have recently observed that NDA's are becoming more targetted to include individual decision makers within the organizations involved in the discussions.  This is partially justified by the turnover of key employees who may take their acquired knowledge with them to their next employer coupled with the fact that many companies have been forced to limit their legal umbrella to their corporate interests vs. those of the individuals that represent them. Note that I said partially justified - not necessarily the honorable or proper course of action.

Common sense suggests that business is business and proprietary confidential information must be protected; which of course is the basis for requiring an NDA. Unfortunately, our legal system favors the deepest pocket when NDA's are applied since the legal fees required to defend or initialte an action often determines the outcome vs. who was right or wrong.

The purpose of my post is to determine if my philosophy of doing business with a hand shake still has merit in today's litigious world.  After all, an NDA - or any agreement - is only as good as the word of the people who entered into it anyway so perhaps they are less necessary than the trend to demand them seems to be heading?

I would appreciate some real world policies and positions regarding NDA's from my DealerElite friends so I can properly counsel my vendor clients in future transactions.

After all, what are friends - and DealerElite - for!

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The days of the handshake have certainly left us behind... Sad in a way.  If a vendor wants my business, I am not likely to sign a NDA.  I can't be responsible for everyone that works with our technology... and if they really want our business... they will not push it.  That being said... I am with you... I understand business ethics... I wish all of our vendors and people were on the same field of play.



Thanks for your support and more relevantly your input suggesting that some opportunities may be missed when trust is challenged at the onset.  Frankly, many vendor negotiations that don't move forward with no explanation as to why may be the casualty of the same dynamic as the car shopper who says they need to shop more or think about it when what they really mean is that they don't trust you!

How many deals are lost over an NDA that would never be applied anyway?  I am not trying to answer that question as much as ask it but it certainly should be addressed by anyone who makes a living in the B2B marketplace; especially as a technology based vendor. 


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