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Consequences of Data Breach
With the rapid growth of the IT industry, we come across terms like cloud computing, virtual data sharing, data theft, data breach, and so on. A report by the Internet and Mobile Association of India (IAMAI) shows that there were 451 million monthly active internet users at the end of the financial year 2019.
Most companies are moving their work online and using cloud storage. Gartner predicts that the Indian cloud market will reach $4.1 billion by 2020. Though digitalizing has several positive impacts, it has some negative impacts. One of the greatest challenges in digitalizing is combating data breach or data theft.
A survey showed that 69% of Indian organizations are prone to data breaches. This puts at the risk, the company as well as all the stakeholders involved in the company.
UNDERSTANDING DATA BREACH:
Data means a representation of information, knowledge, facts, concepts, or instructions which have been processed and stored internally in the memory of the computer.
What is a data breach? The definition of a personal breach of data is structured in such a manner that it covers three fundamental principles regarding informational security i.e. confidentiality, integrity, and availability.
Confidentiality breach means unauthorized access to personal data; Integrity breach means an unauthorized alteration of personal data; Availability breach means unauthorized destruction of personal data. Therefore, any unauthorized access, alteration, and destruction amount to a data breach.
CONSEQUENCES OF A DATA BREACH:
A data breach hits the company like a storm. Before they know it, they will be drowning in losses in all aspects. Some of the most prominent losses are as follows:
Financial Loss
A report by IBM shows that the average total cost of a data breach is USD 3.92 million. Companies can suffer severe financial loss. This particularly affects the smaller business; they cannot afford such a breach. It increases the overhead cost of the business. Costs can include legal fees, revamping the virtual space, compensating the customers, and so on. Some companies can afford it while some cannot. However, such a cost is unnecessary and results in financial loss.
Loss of Reputation:
One of the major concerns of any company is the loss of reputation. Reputation once lost, is difficult to earn back. To the bigger companies, loss of reputation is a greater loss than financial loss. While they can afford a financial loss, they cannot afford a reputational loss.
The data breach by Facebook and Google put them in the limelight for the wrong reasons and thereby hampering their reputation. Loss of reputation affects smaller companies also in the sense that it destructs their growth. They cannot afford to lose their reputation while they are in the process of earning it.
Loss of Operation Time:
When a company is hit with a data breach, they need to mend it. They need to clean the mess and make sure it does not repeat itself. This means they need to focus on this rather than on their business which may result in inefficiency of business which may lead to loss of revenue. Gartner has pointed out that an average loss due to operational downtime is $5,600 per minute. This is not attractive.
Loss of Sensitive Data
A data breach mostly involves sensitive data. Data that must not be made public is made public due to the breach. The data could be financial information, health information, trade and business secrets, information relating to a lawsuit and so on. A data breach puts such information out in the public putting the company and its clients in an uncomfortable situation.
Legal Action
A breach can open doors to a legal suit. Lawyers, accountants and companies have an ethical obligation to maintain confidentiality. A breach of such confidentiality has severe consequences such as debarment, fines, compensation and so on. Further, a legal suit not only creates a legal strain but also a time and mental strain. Legal proceedings can happen over a long period.
DCIRRUS PROTECTING YOUR PRIVACY
You have a right to protect your data. The Apex Court upheld that right to privacy is a fundamental right. Protecting your data is a right to privacy. Taking every measure to avoid a data breach is very important. DCirrus can aid you to take every measure. Your privacy is our priority. Using DCirrus, you will not have to worry about any of the consequences that spring from a data breach. Your data will be secured and protected. Only you get to decide who gets to access your data and to what extent. Storing data and transferring data is encrypted at multiple levels.
Choose DCirrus and avoid the dire consequences of a data breach!
Also Read: Virtual Data Room – Everything you need to know about VDR
