Data is the new currency, and it’s something that every business needs to protect. If you have sensitive customer data, you need to make sure it’s safe and secure.
Data security is a hot topic right now, with companies like Facebook and Google having data breaches. However, it isn’t just large corporations that are vulnerable; small businesses are too.
In fact, according to a study from Sage (a leading supplier of accounting software), more than half of small businesses don’t know how much personal data they hold on their customers or employees.
Why Small Businesses Are Vulnerable
Having a safe and secure network is one of the most important aspects of any business, but especially so for small businesses.
Here are a few reasons why:
They lack resources.
Small businesses are less prepared for a cyber attack than larger corporations. The average cost of a data breach is $4.24 million, according to IBM security. However, the average cost for a small business is $2 million in comparison to $1 million for large corporations.
This makes sense because large corporations have budgets and resources dedicated to security. they know how much it would cost to weather a security breach. Conversely, smaller companies may not even have the resources or expertise required to protect their data adequately. They are also less likely to have insurance policies that cover data loss due to hacking or ransomware attacks.
They don’t think they’re at risk.
Small businesses often believe that they’re too small or unimportant to be the target of hackers. Still, criminals won’t care whether they’re big or small when they’re looking for victims who will pay up quickly.
They have weak security measures.
Small businesses tend to focus on their core business and don’t pay much attention to IT security. They assume that they don’t need complex security solutions because they don’t have much data to protect or they don’t store sensitive information on their servers. On the other hand, large businesses go through the security-related documentation when they are using data pipeline solutions to ensure compliance with data privacy regulations and thus ensure data security even while transferring data
They use old software versions with known vulnerabilities.
Most software vendors release updates every month that fix bugs and prevent exploitation of known vulnerabilities in their products. However, if your company doesn’t update its systems regularly, it will expose you to attacks that exploit those vulnerabilities. Cyber attackers know how to exploit vulnerabilities in older versions of software products as well as in new ones. It’s often the reason for software updates.
Data theft can be devastating for small businesses.
Data theft doesn’t just mean financial loss — it can also mean loss of customer confidence and trust in your brand name.
If you’re not careful about who has access to your customer data, someone could steal your customers’ data. Things such as credit card information or other sensitive data like social security numbers or bank account numbers. Losing this data can put you in hot water with regulators like the Federal Trade Commission (FTC) and Consumer Financial Protection Bureau (CFPB).
Why Data Security Is Important
Data security is never a problem you can ignore. With the growing dependence on digital technology and its applications, the need for secure data is also increasing. The demand for secure data storage has seen many companies offering encryption solutions and services.
Data security is not just about ensuring that your data is safe from unwanted access. It is as much about protecting the integrity of your data from tampering or corruption by unauthorized users. Moreover, you need to do this while maintaining the accessibility of your data to authorized users only.
Data security helps build trust among your customers and stakeholders like employees, partners, and vendors using your information system. A well-managed data security system will help protect you from financial ruin due to loss of sensitive financial or personal information. Whether it’s stored in your database servers or shared over networks or internet connections, you have a duty of care for that data. Laptops or smartphones that your employees use can be lost, or stolen to steal confidential information belonging to their employers.
Customer Trust and Brand Reputation
— If your company falls victim to a data breach, it can hurt your brand reputation and trust with customers. Even if you don’t get hacked, there’s still a risk of someone stealing or leaking your customer data. This can lead to negative press coverage and even lawsuits against your business.
— The General Data Protection Regulation (GDPR) was put into place by the European Union in April 2018 to protect European citizens’ personal information online and establish some privacy rights when it comes to how companies collect, store and use this information. If your company collects customer data, it must comply with GDPR rules or face fines up to €20 million or 4% of annual global turnover — whichever is higher!
How To Keep Data Safe
Many businesses are still using pen and paper to manage appointments and other critical data. The good news is that there are plenty of online tools that can help you keep your customer data safe and secure.
One of the easiest ways to keep your customer data safe and secure is to use third-party tools for handling data. Like SimplyBook.me, for example, which is designed specifically for appointment scheduling. Or Mailchimp and similar tools for sending out mailers or newsletters.
There are many advantages to using these types of services:
- It’s easy to set up an account and manage it through a simple web interface.
- You don’t have to worry about backups or security breaches because the service takes care of all that
- The service provider will automatically update their software whenever necessary. So you won’t have to worry about keeping up with new versions.
- Storing customer conversations (for training and review). Ensure you route calls through a third-party VoIP provider, the conversations are encrypted to prevent potential security risks.
- They are convenient.
- Save time and money through automating processes you would have to do manually. For example, sending out newsletters.
Third-party tools are an essential component of any business that deals with sensitive information. These tools provide additional security by storing your data in a separate location, rather than on your own computers or devices. This reduces the chance that hackers can access your customer database directly from within your company network.
When sending out emails or other marketing material via email, it’s critical to ensure they are not filtered to spam by the recipients’ email service provider. You can do this by using a reputable service such as MailChimp which filters through all incoming emails before passing them on to customers.
How To Set Up Data Safe Processes
The first step in keeping customer data safe is ensuring all employees are aware of the importance of data security. The second step is to follow a data protection policy that ensures your processes protect all customer data. You can do this by setting up procedures to make sure your employees are following the rules.
Create a data protection policy.
You can do this by putting together an employee handbook that outlines what you expect from them when it comes to handling customer data and privacy, as well as posting it on your website or sending out regular reminders via email. Making your employees aware they are accountable is critical to successful data protection.
Audit your systems regularly.
Once you’ve created a system for protecting customer data, you should ensure it’s working by auditing your systems at regular intervals to make employees use them properly. This could involve checking emails and phone calls for compliance with company policy, or inspecting computer files for evidence of inappropriate access or sharing of information.
This is an essential security measure that should you should use for businesses with sensitive customer data. It helps prevent unauthorized access by encrypting the information before it’s sent over the internet or stored on a computer or mobile device. Security software can also be used on databases and other storage media to prevent unauthorized access if they are lost or stolen.
Secure access controls.
These ensure that only authorized users can access sensitive information. At the same time, they keep out those who shouldn’t have access — such as hackers or employees without clearance. Examples include passwords, authorization codes, biometrics, and multifactor authentication systems (where you demand multiple levels of user identification). Is it also a good idea to replace legacy phone systems, and replace them with VoIP systems with encryption.
Backups are essential for disaster recovery purposes. They allow you to restore any lost or damaged files quickly, without having to start from scratch, thus saving time.
Small and local businesses are easy targets for cybercriminals. Even if the value of the company’s customer data is negligible, the desire to undermine the business is what drives them to attack. Since small businesses lack both physical and human resources, they need data-safe processes that minimize their exposure to cyberattacks.
Hopefully, you now know more about why data security is an important consideration for small businesses. Now you’re aware of the importance of data security, it’s time to take the right steps for protecting your business. Small businesses should take advantage of all the tools at their disposal to ensure customer data is safe, secure, and always under control.
Guest Post Author – Anand Srinivasan
Anand Srinivasan is the founder of Hubbion, a suite of business tools and resources for small business owners.