{"id":3795,"date":"2022-01-19T09:23:54","date_gmt":"2022-01-19T13:23:54","guid":{"rendered":"https:\/\/solutionsreview.com\/security-information-event-management\/?p=3795"},"modified":"2022-01-20T18:01:03","modified_gmt":"2022-01-20T22:01:03","slug":"how-to-protect-your-company-from-the-five-consequences-of-data-loss","status":"publish","type":"post","link":"https:\/\/solutionsreview.com\/security-information-event-management\/how-to-protect-your-company-from-the-five-consequences-of-data-loss\/","title":{"rendered":"How to Protect Your Company from the Five Consequences of Data Loss"},"content":{"rendered":"

\"Consequences<\/p>\n

As part of Solutions Review’s Premium Content Series\u2014a collection of contributed columns written by industry experts in maturing software categories\u2014Rob Price, the <\/span>Principal Solutions Consultant<\/span> at Snow Software<\/a>,<\/span><\/span><\/em><\/strong> shares some expert insights on how to protect your company against the consequences involved in data loss.<\/span><\/span><\/em><\/strong><\/p>\n

\"\"Data loss is one of the worst things that can happen to any organization. While losing data from one day’s worth of work may be only a minimal inconvenience, an unrecoverable data loss within billing or R&D systems can be catastrophic.\u00a0<\/span>\u00a0<\/span><\/p>\n

According to the Ponemon Institute’s\u00a0<\/span>2021 Data Breach Report<\/span><\/a>, a data breach in\u00a0the U.S. cost an average of\u00a0$4.24 million\u00a0in 2021, a 10%\u00a0increase\u00a0from the\u202f<\/span>average cost in 2019<\/span><\/a>\u202fat $3.86 million. This type of financial hit is challenging to recover from. While there’s no silver bullet within technology that can help organizations avoid data loss, understanding the types of data within your organization and the value and sensitivity of that data is critical. <\/span>\u00a0<\/span><\/p>\n

For\u00a0IT leaders,\u00a0understanding\u00a0the appropriate measures to put in place to ensure data is both secure and recoverable can avoid\u00a0their organizations\u00a0leaking intellectual property or\u00a0employee and\/or other\u00a0personal data.\u00a0<\/span>\u00a0<\/span><\/p>\n

The Five Key Consequences of Data Loss<\/span><\/b><\/h3>\n

There are five typical negative consequences of data loss: productivity disruption, reputation damage, exposure of confidential information, loss of customer loyalty, and permanent business failure. Let’s take a closer look at each of these consequences of data loss and discuss how data protection and availability can help prevent these risks.<\/span>\u00a0<\/span><\/p>\n

<\/b>1. Productivity disruption<\/h4>\n

Productivity is the first thing to suffer when your organization loses its data, whether it’s from an unplanned network outage, hardware or software failure, or a malicious cyber-attack. Lost files may take hours, or even days, to recover, leading to staff downtime and lost sales. According to the Strategic Resource Institute, companies that cannot resume normal operations within 10 days of a data loss incident\u00a0<\/span>likely will not\u00a0survive<\/span><\/a>.<\/span>\u00a0<\/span><\/p>\n

<\/b>2. Reputation damage<\/h4>\n

In the digital age, news travels fast. If your company can’t serve its clients or ends up in the headlines due to a data loss incident, the negative publicity can permanently damage your business’s reputation. Some organizations spend hundreds of thousands of dollars repairing their brand after a data loss event. Facebook, for example, has faced several data breaches. Most notably was a loss of over <\/span>500 million users’ data<\/span><\/a> in 2021, which exposed phone numbers, email addresses, locations, and biographical information. Leaks such as this will decrease user trust and cause many users to delete their accounts.<\/span><\/p>\n

3. Exposure of confidential information<\/h4>\n

When data is lost from negligence or theft, it can result in the exposure of sensitive and confidential information. Many data privacy laws carry hefty fines that can be issued when customer data or employee records are compromised, and these fines can add up quickly. For example, the CCPA, one of the strongest consumer protection data laws in the U.S., has multiple levels of fines depending on violation type\u2014”intentional violations” specifically carry a fine of $7,500 per record. These financial consequences are compounded if affected individuals decide to take legal action against your business.<\/span><\/p>\n

4. Loss of customer loyalty<\/h4>\n

Customer loyalty is also tarnished after a data loss event, especially if client data is compromised. Suppose current customers can’t trust your company to protect their data. In that case, they may take their business elsewhere. For example, <\/span>83% of\u00a0U.S.\u00a0consumers<\/span><\/a> claim to stop spending at a company for several months immediately after a security breach. Over a fifth claim, they’ll never return to a business post-breach. And once the word spreads, it may be an uphill battle to find new clients.<\/span><\/p>\n

5. Permanent business failure<\/h4>\n

Data loss also has several economic and non-financial impacts on your company. The worst possible outcome is permanent business failure. Each year, a handful of organizations\u2014companies like Code Spaces, The Heritage Company, and Wood Ranch Medical, to name a few\u2014must close their doors following a major data loss event. When the financial impact and hidden costs of data loss combine, it creates a perfect storm that may be impossible to recover from. <\/span>\u00a0<\/span><\/p>\n

How to Protect Company Data\u00a0<\/strong><\/h3>\n

Data is the lifeblood of every organization, and it is impossible to operate your business without it. The most significant mistake organizations make regarding data governance is ignoring data’s value.<\/span> It is crucial to understand what types of data your organization works with, as well as its value and level of sensitivity. When you know these factors, you can then implement appropriate measures to ensure this data is secure and recoverable (in a timely manner to minimize business disruption), thus avoiding leaking intellectual property or personal data.<\/span>\u00a0<\/span><\/p>\n

There are a\u00a0couple of\u00a0processes every organization should have in place, at minimum, to enable data recovery and help prevent data loss in the first place:<\/span>\u00a0<\/span><\/p>\n