Industrial espionage is the illegal and unethical theft of business trade secrets for use by a competitor to achieve a competitive advantage. It is often done by an insider or an employee who gains employment for the express purpose of spying and stealing information for a competitor.
Why is industrial psychology important to an organization? role of industrial psychologist in an organization.


Is industrial espionage ethical?

Although industry representatives, such as the society for Competitive Intelligence Professionals argue that industrial espionage, or spying, is both unethical and illegal, there is sometimes a fine line between the ‘legitimate’ tactics of competitive intelligence gathering and the ‘illegitimate’ practice of industrial …

Why is corporate espionage unethical?

Corporate espionage, as unethical behaviour, is described from various perspectives such as the personality characteristics of employees, the organizational environment, the inter- action between individual characteristics and the organizational environment, and the social interactions within the organization.

What is industrial espionage?

industrial espionage, acquisition of trade secrets from business competitors.

Is it ethical to gather information through corporate spying?

Generally, collecting information on a competitor is fair play as long as: … You do not use fraud or break any laws while gathering information.

Why is industrial espionage an important issue in strategic management?

One of the reasons why corporations engage in industrial espionage is to save time as well as huge sums of money. After all, it can take years to bring products and services to market—and the costs can add up.

What is an unethical situation?

Unethical behavior can be defined as actions that are against social norms or acts that are considered unacceptable to the public. Ethical behavior is the complete opposite of unethical behavior. Ethical behavior follows the majority of social norms and such actions are acceptable to the public.

Why do marketers report to industrial espionage?

In many cases, industrial spies are simply seeking data their organization can exploit to its advantage. … Industrial espionage is most often found in technology-focused companies, in part because of the considerable expense of technology research and development (R&D).

How will you deal with industrial espionage cases?

  • Do not expose your internal network. …
  • Make sure that intermediate storage is secure. …
  • Ensure that Data at Rest is protected. …
  • Protection from data deletion, data loss. …
  • Protection from data tampering. …
  • Auditing and monitoring. …
  • End-to-End network protection.

What is an example of industrial espionage?

Some common examples of industrial espionage include: Breaking into company files or trespassing onto property without proper authorization. Posing as a worker in order to learn company trade secrets or other confidential information. Placing a wiretap on a competitor’s phone.

What are the penalties for offenders in industrial espionage or theft of trade secrets?

Conviction of the theft of trade secrets under the Economic Espionage Act can result in a fine of up to $250,000 for an individual (up to $5 million for corporations), imprisonment up to ten years, or both.

What are the countermeasures against industrial espionage?

Physical security is another best practice used to counter industrial espionage. Physical security refers to physical measures constructed to regulate the movement of people and preserve organisational assets from the reach of hostile entities.

Is intelligence gathering ethical?

According to this approach, some of the methods used to collect intelligence (such as deception and theft in covert operations) are considered morally unethical (Gendron, 2004). To satisfy this approach, only publicly available information would be acceptable.

Is gathering competitive intelligence ethical?

So, based on the law, competitive intelligence is completely legal. … Gathering information by not disclosing who you are to a competitor or by lying would be considered unethical, but it’s not illegal. The best competitive intelligence professionals don’t conduct their practice through illegal or unethical means.

Is it ethical to spy on your competitors?

This is what NOT to do to conduct research on your competitors. Don’t call them pretending to be a client, or the representative of a client, in order to attain information about their pricing and to access materials they would not share with a competitor. It’s dishonest, fraudulent and, in many cases, against the law.

How can we prevent economic espionage?

  1. Identify Your Companies Trade Secrets. …
  2. Identify the Threats. …
  3. Ensure Physical Security. …
  4. Establish Policies for Controlling Information. …
  5. Train the Workforce. …
  6. Compartmentalize Information. …
  7. Conduct Background Checks and Monitoring. …
  8. Establish Employee Exit Procedures.
What is the difference between competitive intelligence and industrial espionage?

Industrial Espionage (IE) is the gathering of proprietary information between competitors. … Competitive Intelligence (CI) is a more ethical approach of gathering information about competitors.

How is economic espionage done?

Economic Espionage Methods Using methods such as bribery, cyber-attacks, “dumpster diving”, and wiretapping. Establishing seemingly innocent relationships with U.S. companies to gather economic intelligence, including trade secrets.

What are unethical issues in business?

  1. Misusing company time. Whether it is covering for someone who shows up late or altering a time sheet, misusing company time tops the list. …
  2. Abusive behavior. …
  3. Employee theft. …
  4. Lying to employees. …
  5. Violating company internet policies.
What does unethical mean in business?

Unethical behavior in business refers to actions that do not fit with a business’ acceptable standards.

What are reasons for unethical behavior?

  • No Code of Ethics. Employees are more likely to do wrong if they don’t know what’s right. …
  • Fear of Reprisal. …
  • Impact of Peer Influence. …
  • Going Down a Slippery Slope. …
  • Setting a Bad Example.
Is being a spy illegal?

Espionage against a nation is a crime under the legal code of many nations. In the United States, it is covered by the Espionage Act of 1917. The risks of espionage vary. A spy violating the host country’s laws may be deported, imprisoned, or even executed.

Which of the following is a likely reason that an organization might be reluctant to admit it has been a victim of corporate espionage?

Which of the following is a likely reason that an organization might be reluctant to admit it has been a victim of corporate espionage? It might cause stock value to decline. … What is the ultimate goal of espionage?

Is corporate espionage illegal?

The U.S. government governs corporate espionage by the Economic Espionage Act of 1996. The law codified what a trade secret was and made stealing commercial secrets a federal crime. Penalties for corporate espionage can result in prison time and millions of dollars in damages.

What defines corporate espionage?

Corporate Espionage is the unlawful theft/acquisition of intellectual property, such as key trade secret and patent information as well as industrial manufacturing techniques and processes, ideas and formulas.

Why does industrial espionage occur?

Economic or industrial espionage commonly occurs in one of two ways. Firstly, a dissatisfied employee appropriates information to advance interests or to damage the company. Secondly, a competitor or foreign government seeks information to advance its own technological or financial interest.

What are examples of espionage?

Espionage is defined as the act of spying or the use of spies by a government or a company. An example of espionage is when a spy infiltrates the government of another country to learn valuable state secrets.

Is it illegal to sell secrets?

For example, in California it is a crime to acquire, disclose or use trade secrets without authorization. Violators may be fined up to $5,000, sentenced to up to one year in jail, or both. Under Cal. Penal Code Section 499(c), trade secret theft is categorized as essentially a form of larceny.

Why should the theft of trade secrets be criminalized?

Once the secret becomes public, the economic damage to the inventor or owner of the trade secret will be immediate and substantial. The theft of trade secrets is therefore a serious white collar criminal offense which gives rise to prosecution in federal court.

What does the espionage Act say?

The Espionage Act of 1917 prohibited obtaining information, recording pictures, or copying descriptions of any information relating to the national defense with intent or reason to believe that the information may be used for the injury of the United States or to the advantage of any foreign nation.

What are the ethical issues of artificial intelligence?

  • Cost to innovation.
  • Harm to physical integrity.
  • Lack of access to public services.
  • Lack of trust.
  • “Awakening” of AI.
  • Security problems.
  • Lack of quality data.
  • Disappearance of jobs.
Is intelligence ethics an oxymoron?

Intelligence ethics: not an oxymoron.

Does the IC need a code of ethics?

The inherent secrecy of the IC requires extra vigilance to adhere to this code of ethics. The IC recognizes that each employee attempts to live by his or her own values, beliefs, and ethical decision-making processes.

Is competitive intelligence ethical or unethical?

Since competitive intelligence relies on public information and market research, you can be reassured that the process is ethical and a wise decision.

Is it illegal to call a competitor?

It’s not technically ‘illegal‘ though as there are no set laws on the books from the government about that. You can however, enter into legally-binding contracts that prevent you from soliciting.

What are some of the legal and ethical issues involved in collecting competitor intelligence?

These issues include privacy, confidentiality, trade secrets, and both civil and criminal breaches of state and federal law.