It’s big news when a high profile company falls victim to a data breach and has to explain the unintended release of sensitive personal information to millions of customers. As of 2017, over 10.3 billion records were breached from 8,075 data breaches made public since 2005, according to Privacy Rights Clearinghouse. Often, small business owners have little or no data protection in place because they simply don’t believe it can happen to them.
If you store business information on a computer, it’s not a question of “if” you are at risk for a data breach. It’s a question of “when” it will happen. A majority of small businesses have had multiple data breaches and most of these incidents were caused by employee negligence and inadvertent mishandling of records – not by foreign hackers or cyber criminals.
The costs to your business of a data theft or loss can be significant. One study pegs the average cost at $141 per compromised record. Multiply that by thousands of records plus the expenses of diagnosing and fixing the problem, along with notifying affected customers, and the bottom line costs can skyrocket.
You can use careful recordkeeping to document the types of data you collect, where you store the information, and how you transmit and move the bits and bytes. Coupled with active protection protocols, like computer firewalls, anti-spyware programs, and encryption software, you can lessen the vulnerability of your sensitive data.
Assuming it’s only a matter of when you will experience a breach, how quickly and thoroughly you respond will determine if the crisis negatively affects your long-term business relationships with the clients whose data was compromised. Data breach coverage can help cover response costs and provide guidance in managing a response plan.