Why Data Privacy Should Be a Priority for Every Small Business

Reputational loss and civil liability can crush a small company

In today’s global marketplace, there’s no such thing as a big fish in a small pond. It’s all one huge pond, where the minnows have to compete with the whales. This means you need to grab every possible competitive edge. That includes using consumer data to facilitate transactions and build customer engagement. Unfortunately, most small business owners don’t have time to go to school on the multitudinous rules that might apply. But if your company stores consumer data, any lapses in knowledge can make you an accidental felon or expose you to civil liability that could shutter your company. That’s why you need a managed IT services provider like KMF Technologies to protect your network, your reputation, and your bottom line.

The high cost of privacy violations when collecting or storing consumer data

Here’s a brief rundown of financial settlements that some large companies have recently paid:

• Meta, $1.4 billion — The Texas Attorney General slapped the social media giant for violating the Texas Capture or Use of Biometric Identifier Act and The Deceptive Trade Practices Act.
• Lehigh Valley Health Network, $65 million — This class action settlement resulted from a data breach involving 600 patients and employees.
• Marriott, $52 million — The hotel giant’s Starwood guest reservation database (allegedly) failed to comply with consumer protection laws, privacy laws, and data security standards damaging more than 131 million users.
• 23andMe, $30 million — A class action blamed a data breach on the company’s failure to employ multi-factor authentication.

Obviously, these are the whales, and they can survive a nasty harpooning. But how would your company fair if forced to pay a proportionate penalty?

Your company must make data privacy a high priority

Sensitive customer information such as personal identifiers, payment details, and health records are prime targets for cybercriminals. A data breach or leak can lead to significant financial losses, damaged reputations, and loss of consumer trust. Small businesses are particularly vulnerable because they may lack the resources to implement robust cybersecurity measures, making them easier targets for attackers.

In addition to direct financial losses, data breaches erode customer trust. Consumers are increasingly concerned about the security of their personal information, and any indication that a business cannot safeguard their data can prompt customers to take their business elsewhere.

Avoiding the consequences of data breaches

Maintaining security requires a knowledge of data security standards and the ways to implement them. Most small business owners are too busy running their business to read up on the different data privacy regimes, such as the General Data Protection Regulation (GDPR) in Europe, or the California Consumer Privacy Act (CCPA). They must rely on someone who has that specialized knowledge to help build their network and safeguard it.

By complying with industry standards, you can drastically reduce the likelihood of a breach and insulate your company from liability, if a breach occurs.

How a managed IT services provider can help

A managed IT services provider (MSP) plays a crucial role in helping small businesses implement and maintain robust data privacy practices. MSPs offer a wide range of services tailored to meet the security needs of small businesses, including:

• Data encryption — MSPs ensure sensitive information is encrypted, protecting it from unauthorized access.
• Secure network infrastructure — MSPs design and maintain secure networks, using firewalls, intrusion detection systems, and other technologies to guard against cyber threats.
• Employee training — MSPs offer training to help employees understand the importance of data security, creating a culture of privacy within the organization.
• Compliance monitoring — MSPs stay updated on evolving data privacy laws, ensuring the business remains compliant with relevant regulations such as GDPR or CCPA.

By entrusting data privacy to a managed service provider, small businesses demonstrate their commitment to protecting customer information. This not only helps avoid legal penalties but also builds trust with customers, fostering loyalty, and enhancing your company’s reputation. KMF Technologies is ready to help you reap the benefits of a secure IT network. Contact us today.