Protecting Your Most Important Asset: Data Security and Data Governance

Many companies look at the dollars involved in robust data security investments and immediately get sticker shock. In reality, a breach can be far more costly and long-lasting – both financially and in impact to reputation. A data breach can cost a company, on average, $3.86 million ($9.05 million for U.S.-based companies). This is factoring in the cost of investigating and detecting the breach, sending written and digital communications about the breach to customers and stakeholders, lawsuits and legal fees, administration post-breach costs, and lost business. On top of the significant financial losses companies have to absorb from data security failures, the most costly impact is to reputation and loss of consumer confidence. As many as 80% of people lose trust in businesses that experience significant data loss, which undoubtedly leads to rapid customer attrition and low lifetime value of those customers. When making the business case for data security reinforcements, Forrester developed a framework to help companies justify investing in data security measures to build customer trust and grow revenue called Total Economic ImpactTM, or TEI. When companies measure the benefits of privacy and data security improvements based on the potential loss against investment costs over three years, it’s possible to achieve an ROI of 17%.