Consider the numbers: according to data gathered from breached organizations , the average organizational cost of a data breach in 2014 increased to $5.9 million, up 9 percent from $5.4 million in 2013. Additionally, the same research revealed that in 2014, the estimated cost of a general data breach was $201 per compromised record, up $10 (7 percent) from 2013.
The upside for companies nationwide is that they can minimize their risk. To avoid what sometimes amounts to operational paralysis, organizational leaders need to follow some basic guidelines.
Data security expert Brian Lapidus, Managing Director & Practice Leader for the Identity Theft and Breach Notification practice of Kroll, has unique frontline experience helping today's businesses safeguard against and respond to data breaches. Below, he offers some important advice that every institution should know about protecting themselves and their customers, employees, and/or students from the damages of fraud.
Look beyond IT security when assessing your company's data breach risks.
To eliminate threats throughout the organization, security must reach beyond the IT department. A company must evaluate employee exit strategies (HR), remote project protocol, on- and off-site data storage practices, and more—then establish and enforce new policies and procedures and physical safeguards appropriate to the findings.
Establish a comprehensive data loss protection plan that will enable decisive action and prevent operational paralysis when a data breach occurs.
Your efforts will demonstrate to consumers and regulators that your organization has taken anticipatory steps to address data security threats. Disseminate this plan throughout the management structure to ensure everyone knows what to do in the event of a breach.
Educate employees about appropriate handling and protection of sensitive data.
The continuing saga of lost and stolen laptops containing critical information illustrates that corporate policy designed to safeguard portable data only works when employees follow the rules.
|Thieves can't steal what you don't have. Data minimization is a powerful element of preparedness. The rules are disarmingly simple:
Don't collect information that you don't need.
Reduce the number of places where you retain the data.
Grant employees access to sensitive data on an "as needed" basis, and keep current records of who has access to the data while it is in your company's possession.
Purge the data responsibly once the need for it has expired.
Business models and operational processes change and might alter risk levels and liabilities. Determining if you've acquired new areas or levels of risk can be accomplished through both internal audit and specialized external resources.
Provide training and technical support to mobile workers.
Ensure that the same standards for data security are applied regardless of location, by providing mobile workers with straightforward policies and procedures, ensuring security and authentication software is installed on mobile devices and kept up-to-date, and providing adequate training and technical support for mobile workers.
Retain a third-party corporate breach and data security expert to analyze the level of risk and exposure.
An evaluation performed by an objective, neutral party leads to a clear and credible picture of what's at stake, without pressuring staff who might otherwise worry that their budgets or careers are in jeopardy if a flaw is revealed. Furthermore, research shows that organizations with a strong security posture or a formal incident response plan in place prior to the incident can reduce the average cost of a breach as much as $21 and $17 per record, respectively .
Don't rely on encryption as your only method of defense.
Encrypting data in transit and at rest is a best practice, but, when used alone, it can give businesses a false sense of security. Although the majority of state statutes require notification only if a breach compromises unencrypted personal information, professionals can and do break encryption codes.
Keep current with security software updates (or patches).
An unpatched system is, by definition, operating with a weak spot just waiting to be exploited by hackers. Admittedly, applying patches takes time and resources, so senior management must provide guidance on allocations and expectations.
It's important to define your security requirements upfront with vendors—third-party service providers may be required to maintain appropriate security measures in compliance with certain state and federal regulations. Ensure that your organization maintains control of data at all times, especially with offshore data storage or services. Your partner’s mistake can cost you; a third-party breach can increase the per record cost by $25 .
1 Source- Ponemon Institute, 2014 Annual Study: U.S. Cost of a Data Breach.
2 Source- Ponemon Institute, 2014 Annual Study: U.S. Cost of a Data Breach.