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

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