What is Data Protection & Why Does it Matter to SMB Owners?

Does your company have measures in place to  protect its data assets ? If a data breach happens,  will your business survive? If this is the first time you’ve thought about questions like this,  you’re not alone!  Several companies need help with  data protection  measures.  Hi! I’m AJ! After selling my company for multiple seven figures, I started Small Business Bonfire  to help entrepreneurs achieve their dreams .  Scaling my business was challenging, but I was able to overcome the obstacles with a strong team and effective systems in place. One of those systems was data protection. But what exactly is data protection, and why does it matter to SMB owners? Let’s dive in and find out!









Key Takeaways







Recognizing the importance of data protection is critical for the survival and success of any business.




Businesses must know the potential risks of data breaches and take preventive measures to safeguard data assets.




The US, EU, and Australia each have varying data protection laws that companies must follow.




Protecting data helps build customer trust because they know their sensitive information is safe. 
















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What is Data Protection?



Data protection is  when companies guard sensitive information  from loss, damage, or corruption.  Over the past decade,  data security has grown increasingly important  because there is significantly more data created and stored by companies and consumers.  On top of that,  business processes have grown increasingly dependent on data to function  correctly.  Even a small amount of data loss can prove  detrimental  to some businesses.  When companies don’t implement data protection policies and practices, some things that can happen include the following:  Financial loss  Damage to the company’s reputation  Loss of customer trust  Legal liabilities  Data protection is a primary focus point  for several small businesses because they want to earn potential and current customer trust.  Therefore, typical data protection strategies focus on  three things , which include the following:  Data security : Protecting data from intentional or accidental damage  Data   availability : Restoring data quickly if there is damage or loss Access control : Data must be accessible to people who need to, and nobody outside that circle In the next section, we’ll observe the  three principles of data protection  every company must consider!















Principles of Data Protection



There are  three principles of data protection , which include:  Data availability  Data management  Information cycle management Here’s what you need to know about each of these principles!  Data Availability Data availability refers to the  accessibility  and  usability   of data  whenever and wherever it is required.  Further, this principle  emphasizes the need for data to be readily recoverable  in case of loss or damage, ensuring the seamless continuation of business operations.  Therefore, data availability involves strategies like:  Data backup Data replication Procedures for quick data recovery Data Management Data management is  collecting ,  keeping , and  using data securely , efficiently, and cost-effectively.  Also, data management is critical to an organization’s business strategy as it  helps ensure the data they collect remains accurate, consistent, and accessible.  Proper data management not only facilitates the smooth functioning of a business but also aids in the following things:  Companies making informed decisions Compliance with regulatory requirements Protection against data breaches Using a customer relationship management ( CRM ) system is one of the easiest ways to manage and organize data. Information Cycle Management Information cycle management focuses on assessing, classifying, and protecting information.  Further, the  primary goal of information cycle management  is to prevent application and user errors.  Additionally, this practice aims to prevent the following things:  Malware attacks  Ransomware attacks  System crashes  System malfunctions  Hardware failures Put simply, information cycle management aims to  prevent unauthorized access  to company data to protect data!





















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Pro Tip #1: Hire a data protection expert to help your company organize and safeguard its sensitive information if you need help knowing where to start. 
- AJ Silber









What Is Data Privacy and Why Is it Important?



Data privacy is about  the right to keep your personal information private.  Imagine if your diary got into the hands of someone else, pretty bad, right?  Data privacy works the same way  but with your digital information.  Examples of digital information could be anything from your name and address to your favorite pizza toppings.  Why is keeping personal data private so vital?  Well, imagine if someone you didn’t know personally knew everything about you – creepy, right? That’s why  it’s essential to protect personal data!  Further, companies have to respect your data privacy, meaning they can’t just share or misuse your information without your permission.  So, just like you wouldn’t want everyone at school reading your diary, it’s crucial to keep your digital data private, too.















Data Protection vs Data Privacy



Data protection and data privacy are  two sides of the same coin.  Many small business owners get confused because these terms sound very similar.  Here’s what you need to know.  Data protection  is like a locker in your school.  You use your locker to keep your stuff safe from getting lost, damaged, or stolen.  Further, your locker ensures your belongings are  secure  and  available when needed.  Like this locker,  companies use data protection to keep their digital information secure and recoverable. On the other hand,  data privacy  is like your school’s rules about not going through other students’ lockers.  These rules  respect and protect your personal space  and the stuff you keep in your locker.  Similarly, data privacy is about  rules that prevent companies from inappropriately using or sharing your personal data  without your permission. In summary, while  data protection deals with the safety and recoverability  of data,  data privacy  is all about  respecting the ownership and confidentiality of the  data.















Enterprise Data Protection Trends



There have been a few  data protection trends  recently.  Why is it necessary to know about these trends? Well, if your business wants to remain trustworthy, it must have a data protection strategy! Let’s look at four data protection technologies! Hyper-Convergence Hyper-convergence systems are rapidly replacing many traditional data protection systems because  they provide cloud-like capabilities.  With a hyper-convergence system, businesses can  backup  and  recover   data  in one device.  Further, this device integrates compute, networking, and storage infrastructure!  Ransomware Protection Ransomware protection is a crucial security measure that  prevents and mitigates ransomware attacks. Ransomware attacks are malicious software designed to block access to a computer system until a company pays a certain sum of money.  A  comprehensive ransomware protection strategy  involves the following things:   A combination of security software to detect and block these threats User education to avoid risky behavior Regular data backups to ensure data can be restored if an attack occurs Essentially, it’s a  multilayered approach  that seeks to prevent attacks, protect sensitive data, and ensure swift recovery during a breach. Disaster Recovery as a Service Disaster recovery as a service (DRaaS) is a  cloud-based system  that lets a company  create a remote copy of local systems.  Some DRaaS systems even allow businesses to create a copy of an  entire  data center.  Companies use these copies to restore operations if there is a disaster.  Copy Data Management (CDM) Copy Data Management (CDM) is an approach that  reduces storage costs and improves efficiency  by minimizing the production of redundant copies of data.  Further, CDM involves creating virtual copies or snapshots of data, which businesses can use for  backups ,  testing , or  data analysis. As a result, this  eliminates the need for multiple physical copies.  By centralizing the control of data copies,  CDM ensures optimal resource utilization  and improves data accessibility and protection.

















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Pro Tip #2: Conduct regular data reviews to ensure your information is organized and safe; although it's time-consuming, it's better than dealing with a data breach!
- AJ Silber









Data Protection Strategies



Finding a  data protection strategy  that works for your company is crucial.  Fortunately, there are several strategies to protect sensitive data.  Let’s analyze the most popular data protection strategies!  Audit of Sensitive Data A data protection technique is  auditing company information before anything else.  At this stage, you must do the following things:  Identify data sources  Understand company data types  Identify the storage infrastructure that your business uses  After that, you must  classify data into sensitivity levels  and see what data protection methods already exist.  Assessing Internal and External Risks Another data protection strategy is to assess  internal  and  external   security risks.  Then, as you implement data protection technology, it will revolve around the risks you and your team identify.  Some  examples of internal risks  include the following:  Errors in IT configuration  Errors in security policies  Lack of strong passwords  Poor authentication  Unrestricted access to storage services or devices On the other hand, some  examples of external threats  include the following:  Phishing Malware distribution  Attacks on corporate infrastructure  Distributed denial of service (DDoS)  Defining a Data Protection Policy Defining a data protection policy refers to establishing  rules, procedures, and standards for preserving and managing an organization’s data.  Further, a data protection policy  outlines how data should be handled,  stored, accessed, and shared to ensure its integrity, confidentiality, and availability.  Further, these policies encompass the following things:   Backup procedures Security measures Protecting the privacy of data  Disaster recovery plans  Compliance with legal and regulatory requirements Security Strategy Providing continuous data protection is critical.  Regarding security strategies, companies must think about the following things:  Taking measures to prevent threats from accessing personal data and other sensitive information  Ensuring security measures don’t impact productivity  Ensuring security measures don’t prevent employees from accessing information when and where they need it  Managing data backups effectively to avoid ransomware and other threats  Compliance Strategy Finally,  every data protection strategy must take compliance obligations into consideration.  For instance, certain industries or products might be subject to various regulations or compliance standards.  Some of the  most significant regulations  that impact the protection of personal data include the following:  European Union (EU)  Data protection laws in the United States  Data protection laws in Australia Let’s look at the compliance standards associated with each of these entities!  European Union (EU): the GDPR The  General Data Protection Regulation  (GDPR) impacts every company that does business with EU citizens.  The GDPR is in effect for companies  whether or not they are located in the European Union.  If businesses fail to comply with these regulations, they can face fines of up to  4% of worldwide sales  or  20 million euros!  What does the GDPR protect against? These regulations protect things like:  Names  ID numbers  Date of birth Addresses  Web analytics data  Medical information  Biometric data  Data protection laws in the USA The data protection laws in the United States are not as severe as they are in Europe.  Still, the US has several regulations that impact data protection.  Some of these regulations include the following:  The Federal Trade Commission Act : This act requires companies to respect consumer privacy and follow privacy policies.  The Health Insurance Portability and Accountability Act (HIPAA) : This act regulates how health information is stored and used, ensuring it remains confidential.  The Gramm Leach Bliley Act (GLBA) : This act regulates the collection and storage of personal data by financial institutions.  The California Consumer Privacy Act (CCPA):  This act protects California residents and ensures they can access their personal information, request deletion, and request their data isn’t collected or resold.  Data protection laws in Australia Lastly, there are data protection laws in Australia.  The Australian Prudential Regulatory Authority (APRA) introduced  CPS 234  in 2019, which are  mandatory data privacy regulations. CPS 234  requires companies to improve security measures  to protect data from attacks.  Also, CPS 234 applies to the following organizations:  Accredited deposit-taking institutions  General insurance companies  Life insurance companies  Private health insurance organizations  Companies licensed under RSE















Critical Best Practices for Ensuring Data Privacy



What are examples of best practices for continuous data protection?  Some examples of best practices include the following:  Data security  Taking inventory of your data  Minimizing data collection  Being open with who uses your data  Protection personal data  Let’s look at each of these best practices in closer detail!  Data Security Data security refers to the  set of standards and technologies that are implemented to ensure data is protected  from the following things:   Unauthorized access Corruption Theft    Further, data security encompasses a broad range of protective digital privacy measures that are applied to  prevent unauthorized access to computers, databases, and websites.  Further, data security is pivotal in the following aspects:   Ensuring the integrity and privacy of sensitive information Preventing data breaches Complying with various privacy laws and regulations Inventory Your Data Taking inventory of your data  involves identifying and categorizing all of the data within an organization. On top of that, taking inventory involves  understanding where it is stored and who has access to it.  This process is critical for the following things:  Maintaining data protection Managing data effectively Ensuring compliance with privacy regulations Minimize Data Collection Minimizing data collection is essential as it  reduces the risk of exposing sensitive data  in case of a data breach.  Also, it  simplifies compliance with various privacy regulations , as having fewer data to manage and protect means fewer chances for potential compliance issues. Be Open with Your Users It is vital to  be transparent with your users about how their data is collected, used, and stored.  Firstly,  it builds trust  and  enhances your brand reputation , as users are likelier to trust and engage with organizations that respect their privacy.  Secondly, transparency is often a  legal requirement  under many data protection and privacy laws. Therefore, staying transparent helps your organization comply with regulatory standards and avoid potential fines or legal repercussions. Protection of Personal Data Protecting personal data is critical to upholding an individual’s right to privacy and ensuring personal safety. Misuse of sensitive information  could lead to any of the following things:  Potential harm  Identity theft   Financial fraud Also,  personal data protection helps organizations  maintain customer trust, comply with various data protection laws, and avoid possible legal and financial repercussions!















Data Protection Examples



What are some examples of data protection in the real world?  Below, I’ve provided three examples of how certain companies can implement data protection practices to build customer trust and adhere to data-related laws.  Let’s take a look.  Example 1: Two-Factor Authentication in Banking  Many banks have now implemented  two-factor authentication  for online banking services.  Two-factor authentication  adds an extra layer of security  by requiring users to provide two different authentication methods.  Usually, the factors of authentication are  a combination of something a customer knows , such as a password or PIN,  and something they have , such as a smartphone, to receive a one-time code.  Using two-factor authentication is a practice that ensures even if a cybercriminal manages to get hold of a user’s login credentials, they still can’t access the account without the second authentication factor.  Two-factor authentication helps prevent fraud and unauthorized purchases.  Example 2: End-to-End Encryption in Messaging Apps Applications like  WhatsApp  and  Signal  use end-to-end encryption to protect the privacy of their users.  With end-to-end encryption,  only the sender and recipient of a message can read its content.  Therefore, even the service providers themselves  cannot decrypt the messages.  As a result, even if someone intercepts the messages,  they would be unable to read them , ensuring the privacy and security of user communications. Example 3: Use of VPNs for Secure Internet Connection Virtual Private Networks (VPNs) are commonly used by individuals and organizations to enhance their online security and privacy.  What does a VPN do? A VPN  masks the user’s IP address  and routes their internet traffic through a secure and encrypted tunnel.  As a result, it makes it  much harder for third parties to track online activities  or steal data.  Also, this tool is  especially useful in safeguarding sensitive information when using public Wi-Fi networks , which are often less secure and more vulnerable to cyberattacks.















Final Thoughts on Data Protection



Data protection is when companies take action to prevent sensitive information from being stolen, getting lost, or getting damaged.  Data protection regulations ensure organizations follow certain rules to protect online shoppers.  Still, when companies are transparent about their data protection policies, they’re likelier to gain customer trust!  What data protection policies does  your  company implement? Let us know in the comments section before!  Good luck with data lifecycle management and protection for your business! 




The post What is Data Protection & Why Does it Matter to SMB Owners? appeared first on Small Business Bonfire .