Big data can be dangerous.
The term big data has become ubiquitous in the world of business and marketing.
Yet many companies are still getting to grips with how to make the most of the significant opportunities for business optimisation contained within the 2.5 quintillion bytes of data (that’s 2.5 followed by 18 zeros!) that is created every day.
The options of how to use big data may seem boundless, but businesses must exercise a level of caution before diving headfirst into the complex world of data management and analysis.
While companies continue to gather information about customers at an accelerating rate, it is worth taking the time to stop and ask whether you should be keeping certain data sets in the first place.
Not least because the cost to store and manage large volumes of data can represent a significant investment, often requiring new hardware or cloud solutions.
Also, and more importantly, because holding customers’ personal information, such as payment card details, dates of birth, addresses, national insurance numbers and healthcare details constitutes a substantial security risk.
UK credit card numbers, when sold on the dark web alongside bank account numbers, date of births, billing addresses, PINs or Social Security Numbers can command $35 per sale.
In addition, individual healthcare records can fetch more than $50. When you consider that hundreds if not thousands of records are often stolen at a time, this can represent a significant monetary incentive for hackers and cyber-criminals.
More data means a bigger target
The number of cyber-attacks and data breaches continues to grow worldwide and show no sign of slowing.
As such, people need to question whether they are able to justify storing sensitive customer information purely for using it to improve business processes.
Just recently American fast food chain Wendy’s admitted its latest data breach had resulted in more customer card information being stolen than previously estimated.
In addition, new industry figures indicate that nearly two thirds of businesses in the UK have suffered a data breach within the last two years.
This is made even more shocking by the fact that 37 per cent of these attacks were reported to have been a malicious act by someone from within the company.
Clearly, processing and holding onto data can be a significant security burden.
>See also: How big data is changing business innovation
The marketing department is one business area that can benefit the most from gathering and analysing customer data.
But it is vital to differentiate between the information that will truly add value to a company’s services and improve customer experience.
Data is only as good as the insights it can provide.
Yes, it may seem like good business sense to collate as much as possible in the hope it will lead to actionable information.
However, without the right security processes in place it can leave you wide open to a data breach incident.
This is especially true as cybercriminals become increasingly sophisticated in their methods of stealing data.
>See also: 3 steps for big data project success
One solution for companies and those employees responsible for overseeing data collection is to hand the responsibility for information management to professionals who have the highest level of IT security in place.
After all, you can’t hack data you don’t hold.
Don’t forget about data protection laws
The Brexit might have had some companies hoping that the new EU General Data Protection Regulation (GDPR) would no longer apply to UK data operations.
However, most expert opinion points to the contrary, with the Information Commissioner’s Office (ICO) stating last week, “For many organisations, nothing will change. The GDPR will apply even when we leave”.
The upshot of this is that companies will need to prove that they can adequately adhere to the new laws around handling and securing EU customer data.
Failure to do so will result in harsh penalties – €20 million or 4% of global turnover, whichever is highest. In the face of such serious consequences, companies need to ensure security processes are up to scratch.
>See also: Google launches ‘big data’ analytics service
Ultimately, the more data you hold, the more complex proving ‘equivalence’ will become.
Good data vs. dangerous data
Yet fines are just the tip of the iceberg.
Data breaches also cause enormous damage to brand reputation, and result in falling share prices, employee layoffs and costly lawsuits.
It is far too easy to watch what you thought was good, valuable data turn into a dangerous liability.
At the end of the day, businesses need to evaluate whether the potential – and often unrealised – benefits of storing customer information really outweigh the risks of a data breach.
Sourced by Tim Critchley, CEO, Semafone