Valuable lessons can be learned by several high-profile data breaches that have occurred in recent years. The immediate financial consequences from a data breach are costly; however, they can also have a ripple effect that can last for years. In order to reduce the risk of breaches, the chief executive officer (CEO) and board of directors need to work with technology leaders to discuss the risks and costs of a data breach and develop a strategy for reducing that risk.
According to the 2016 Cost of Data Breach Study by the Ponemon Institute, discussed in “Business Leadership in a Tech-Driven World: How CEO’s Can Manage Proactively to Protect Data and Build Customer Confidence,” the cost of a data breach has not changed greatly over recent years. This observation suggests that businesses need to prepare for the cost of a breach and incorporate that estimate in data protection strategies and their respective cyber insurance coverage. The study also revealed that the largest financial consequence of a data breach is lost business. Customers are likely to lose trust in your business and the effort to regain their trust can take years, resulting in long-lasting financial impact.
CEOs Secure Data With Support of IT Experts and Cloud Providers
The Home Depot data breach lasted from April through November of 2014 and resulted in the exposure of 56 million credit and debit cards, as well as 53 million email addresses. The warning signs suggesting that systems weren’t secure appeared in 2008; however, internal security experts dismissed the warnings famously saying, “We sell hammers.” A combination of outdated software, lack of involvement by leaders, and slow response time contributed to the magnitude of this breach.
The CEO, board of directors and IT experts can work together to draft a security plan and deploy the technology to strengthen security and reduce exposures that can lead to a data breach. Cloud technology supports efforts to increase security, without becoming a distraction to other business-critical priorities. An experienced cloud provider can offer innovative security measures, expedite disaster recovery efforts and streamline business continuity in the event of a cyber-attack.
Building revenue and managing data security efforts can each take top priority for CEOs.
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