The 5 Biggest Data Privacy Mistakes That Companies Make

11 June 2024

Data privacy can make or break an organisation.

When any consumer gives a business their information, there is an element of trust that acts as the foundation of that transaction. Beyond goods and services or money, this trust is a company’s most valuable asset.

But it’s no secret that most businesses, from SMEs to multinationals, stumble when maintaining this trust and protecting sensitive customer information. This blog delves into the most common data privacy mistakes we’ve seen companies make.

What Happens If Companies Don’t Comply With Privacy Regulations?

The consequences of failing to prioritise data privacy can be severe. Besides financial penalties imposed by regulatory bodies, companies will also grapple with reputational damage and loss of customer trust.

Data privacy breaches make international headlines and prompt nationwide outrage. Recently, Australian telecommunications giant Optus saw its CEO, Kelly Bayer Rosmarin, resign following a major cyber attack that compromised more than 2 million consumers’ personal identification documents. It’s becoming imperative for businesses to place data privacy at the top of their priorities.

What Are the 5 Most Common Data Privacy Mistakes Companies Make?

1. Lack of C-Level Involvement

Data privacy policies should be maintained from the top. Without the support of C-level executives, any data privacy efforts will likely be ineffective or short-lived.

C-suite executives are responsible for driving this conversation within their organisation and educating employees on the importance of data privacy. They set the tone for the rest of the company, so only if top management commits to fostering a culture of privacy can data privacy become a priority for the whole organisation.

2. Investing In Technology Alone

You can’t throw money at a problem and make it disappear, and your approach to data privacy is no different. One of our biggest misconceptions is the belief that investing in advanced technology, such as antivirus software or firewalls, can address all data privacy issues. Technology is an essential part of your defence, but it is by no means a panacea.

As with any other business issue, data privacy is a multifaceted challenge that mutates daily. It requires a comprehensive, multi-stakeholder approach that technology alone cannot address. For instance, are you aware that most data breaches occur from within the organisation itself, usually through an accidental leak by one of the employees?

The use of technology needs to be complemented by robust internal policies, employee training, and a culture of privacy within the organisation.

3. The Lack of a Privacy Culture Within the Organisation

Data privacy is not solely the responsibility of the legal or IT departments. As we covered, most data leaks occur internally, not through cyber attacks. To counter this, data privacy should be ingrained in the organisation’s culture, as much a part of its DNA as its vision and mission.

Employees should be educated on consumer data and trust, providing consistent and up-to-date training, and empowering employees to mitigate data breaches. Everyone who works at the company, from C-suite executives to marketing or retail workers, should be passionate about data protection.

4. Insufficient Investment

We often encounter companies that believe investing in data privacy is an unnecessary expense or an investment that only pays off for big tech companies. Neither could be further from the truth.

Data privacy is not merely a legal obligation but is, in fact, an essential business strategy. Organisations can build trust and rapport with customers and earn a good reputation with proper investment and communication of responsible data practices. Furthermore, the financial repercussions of violating data privacy laws far outweigh any investment in privacy policies.

5. Treating Compliance As A Checklist Item

Most companies make the mistake of treating data privacy compliance as a one-time task to be checked off a list. Compliance should not be viewed as a mere box-ticking exercise but as an ongoing commitment to protecting customer data. A comprehensive policy framework must be established, encompassing legal requirements, industry best practices, and evolving regulations. Regular audits and updates to policies are necessary to ensure continued compliance.

For instance, as technology continues to advance, new challenges arise in the realm of data privacy. The General Data Protection Regulation (GDPR) is now adapting to include regulations specifically related to artificial intelligence (AI). Companies utilising AI technologies must be aware of these evolving regulations and update their policies to maintain security.

Stay Informed, Stay Secure

The risks associated with data privacy are far too severe for organisations to gamble with. Organisations face not just severe financial, legal, and PR repercussions, but also barter with consumers’ lives and identities if they fail to implement a robust privacy framework.

As a leading data privacy consultancy, we offer comprehensive solutions to address the biggest challenges companies face. From employee training programmes to developing a roadmap for data privacy implementation, we ensure organisations are equipped to protect customer data and meet regulatory requirements. At the tap of a button, we take care of privacy for you.