Whether we like it or not, companies will always need to collect data. Often, the data collected can be private or sensitive, which means that it needs to be protected. When customers hand over information (personal, financial and otherwise) - they expect your business to protect it. That means using the most up-to-date data security technology and techniques.
A data breach can have disastrous consequences, including significant financial losses, permanent reputational harm, and a decline in customer trust. It is no longer a question of discussing IF data security is necessary; instead, the emphasis is on HOW to best provide that protection.
It’s important to point out that data security is not just about protecting information; it's a comprehensive strategy that protects the integrity of your business on all fronts. By investing in robust data security measures, you can protect yourself from potential threats, ensuring your longevity and long term business success.
Included in this post:
Why data security matters
Why is data security important, and why should it be taken seriously?
Protecting sensitive information
Imagine the damage that could be done if someone with bad intentions got their hands on your customers' personal information, employee information, and/or financial records. Never mind the reputational damage your business would suffer - identity theft and financial crimes are a very real threat. Implementing an antivirus scanner can help greatly to secure your data.
Compliance with regulationsIndustry and data security regulations are in place for a reason. Failure to comply with these regulations can result in some hefty legal and financial implications.
Preservation of Intellectual PropertyIntellectual property is an important asset for many businesses, and it often includes valuable trade secrets. Keeping them secure is essential to maintain a competitive advantage in the market
Avoiding financial lossesLegal payments, damage management costs, and the strengthening of security protocols are all part of the cost of repairing the damage caused by a breach. Not to mention the cost of lost business and a tarnished brand.
Reputational damage and trust erosionTrust is the bedrock of successful business relationships. If sensitive information is exposed, trust can be shattered in an instant. Customers and/or partners might decide to do business elsewhere if they do not trust your business.
Business InterruptionsThe disruption of a breach is not to be underestimated. Day-to-day operations may be severely disrupted by a data breach - meaning lower productivity and higher costs.
Best practices for strong security
Let’s take a look at some of the best practices for maintaining good data security:
Develop a comprehensive security policyA robust security policy is the foundation of quality data security. It should clearly outline procedures for data protection, access control, password management, and incident response. Regularly review and update the policy to reflect emerging threats, changes in technology or regulation changes.
Train employees on security protocolYour staff are on the ‘front line’ of data security and play a major role in helping you to maintain a tight ship. Ensuring they have had comprehensive training on security protocols is essential.
Employees need to know how to:
- Handle sensitive data securely
- Recognise and report potential threats such as phishing attempts
- Understand the importance of adhering to security policies
This is also not a set-and-forget exercise, regularly reinforce training through ongoing awareness programs.
Keep software up-to-dateOutdated software and operating systems are more vulnerable to security breaches. Regularly update all software, including operating systems, applications, and security tools, with the latest patches and upgrades.
Use multi-factor authentication (MFA)Implementing MFA adds an extra layer of security to the authentication process. Reduce the risk of a data breach by requiring users to provide multiple forms of authentication when accessing systems and software.
Have a *good* backupHaving an up-to-date copy of your systems and data in a secure and geographically distributed location is good practice. Having this would allow you to face a cyber-attack, natural disaster, or system failure with relative ease. Training on how to fail over to that data, along with periodic testing of the failover process is also recommended.
Implement Audit TrailsAudit trails are a detailed record of activity and changes made to the system or applications data. Having this type of information available allows you to protect your business in a number of ways including, detecting and preventing fraud, proving compliance, aiding investigations and enhancing your risk management.
Limit access to sensitive dataNot everyone needs access to ALL the information. Only grant access to the team members who need it. Implement role-based access controls which are reviewed regularly.
Enforce a robust password policyStaff have a variety of accounts for various tools and platforms that your business makes use of. Having a robust password policy in place adds another layer of security to protect that data.
Perform regular security auditsThis helps to identify potential vulnerabilities and ensures compliance with established security protocols. Things like penetration testing, vulnerability assessments, and security audits help to identify weak points.
By following these best practices, businesses can significantly reduce the risk of a data breach and safeguard sensitive information. Read here for tips on how to reduce business data risk & increase data security & compliance.
Some real-world examples
Highlighting 2 real-world examples of when security went wildly wrong helps to firm up some of the abstract concepts discussed above. For each example we will look at the problem that occurred, the consequences that were faced and then also take a look at what each company should have done, so that these issues do not repeat themselves.
In 2013 and 2014, Yahoo experienced two separate data breaches that compromised the personal information of billions of its users.
The first breach, disclosed in 2016, affected approximately 500 million user accounts. It involved unauthorised access to sensitive user information, including names, email addresses, telephone numbers, and hashed passwords.
However, the impact of the first breach was overshadowed by an even larger and more damaging incident - the largest data breach on record.
In 2017, Yahoo revealed that it had experienced another massive breach in 2014, which had compromised the personal information of approximately 3 billion user accounts. This breach included names, email addresses, telephone numbers, dates of birth, hashed passwords, and in some cases, security questions and answers.
The Yahoo breaches had severe consequences for the company:
|How can these issues be avoided?
Ubiquiti Networks is a technology company that specialises in wireless data communication products. In 2021, the company disclosed that it had experienced a significant data breach resulting from an employee falling prey to a phishing scam.
According to the company's announcement, an attacker posed as an executive within the organisation and sent an email to an employee requesting the change of their account credentials.
The employee, believing the email to be genuine, provided the requested information, unknowingly granting the attacker access to the executives account.
Through this compromised account, the attacker gained unauthorised access to Ubiquiti's IT systems, including customer data. The breach potentially exposed sensitive customer information, such as names, email addresses, hashed passwords, and IP addresses.
The significance of both the technological and human aspects of data security is highlighted by this example. Constant education, assistance, and training can aid in preventing issues that are produced by people. This might also have been avoided by implementing strong technical security. Let's now examine in greater detail what businesses can do to prevent such problems:
|How can these issues be avoided?
The cases of Yahoo and Ubiquiti Networks demonstrate why, in the current digital environment, data security should be an essential focus for businesses. Such events serve as cautionary tales, emphasising the consequences of inadequate data security procedures.
Data security matters for your business because it directly impacts your reputation, customer trust, and financial stability. A data breach can lead to loss of customers, regulatory penalties, and costly legal consequences. It disrupts operations, consumes resources, and undermines the integrity of your brand.
By prioritising data security, your business can instil confidence among customers, partners, and stakeholders. Implementing best practices such as robust security infrastructure, regular audits, employee education, incident response plans, and transparent communication helps mitigate the risks and impacts of data breaches.
Data security is an investment in the long-term success of your company. It is a proactive method of preserving customer confidence, securing sensitive data, and defending your brand's reputation.
Set data security as a top priority today to ensure the resilience and security of your business.