2. The Disclosure Backlash Case—Information Transparency in Effective Contractual Management

This case study presents a problem which Internet-based companies often face, namely the fact that their terms of service are not sufficiently transparent. When customers fail to understand how a product or service is handled, a company is in a difficult position. On the one hand, it needs to preserve its business model which relies on the processing and sale of customer data to third parties. On the other, it has to improve disclosure practices to its clients if it wants to avoid extreme negative reactions among its customer base. Taking an Internet startup as an example, this case study demonstrates how the duty of Internet-based companies to inform their customers requires transparent information about both pre- and post-transactional processes. The case study implements all five steps of the CM Model and places special emphasis on knowledge management considerations as the best bringers of positive change in such circumstances.