Only 3 weeks until GDPR enforcement. Do you know what does GDPR mean for your business? With fines up to 4% of your company’s annual turnover, get the information you need today and prepare for the new regulations before it’s too late.
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The European General Data Protection Regulations (GDPR) will come into force on May 25, 2018. These regulations will have a significant impact on existing data collection and analysis methods.
Many businesses have become reliant on customer data collection for marketing and product designing. These businesses would need to formulate a new strategy on how to keep their business operations going while dealing with the EU regulations.
The GDPR Regulations
The main objective of GDPR is to ensure that organizations implement strict privacy rules and stronger data security when it comes to protecting personal data. The regulations will make it mandatory to obtain consent from users before acquiring or using their personal data.
Organizations will also be required to inform their customers and users about the personal data that they are collecting and using. Data subjects will have the complete right to withdraw their consent at any time, and organizations will be required to delete the record where consent has been withdrawn.
Noncompliance with the regulations will result in hefty penalties. A company can be fined up to €20 million or 4% of its annual global turnover in extreme cases.
The Complexity of Acquired Data
Data acquired by businesses through the normal channels is usually in a complex form, and the process is completely automated. This presents two major problems for organizations.
Locating Customer Records
In theory, business organizations can become compliant with the new regulations by letting their customers know about their information that is being held by the company. Any data that customers want removed could be deleted.
In reality, the problem is that a majority of businesses may not even be aware that they are holding customer data or how to track it. Many would find it difficult to locate the exact customer information in their massive database or even in their paper files.
Problems in Data Processing
Businesses often rely on built-in models that extract relevant data fields from incoming customer information. Managing these processes will be a challenge for organizations looking to become compliant with the new regulations.
An organization would need customer consent to acquire and use their information. While some customers might be willing to share one set of information, others might be willing to share a different set. A third group might refuse to give consent at all.
This would make the data inconsistent. Any attempts to derive meaningful results or market trends would be similarly useless.
Solutions Available to Organizations
In order to stay compliant with the new legislation, business organizations would need to apply new techniques for collecting, storing, and processing of data. Some of the steps that should be taken by businesses are the following.
- Inform clients and obtain consent prior to acquiring any personal data.
- Update the company’s existing or new databases with procedures that allow access, transfer, and deletion of specific client details.
- Properly document the company policy on collection and processing of client data and have it communicated to clients.
- Store and process all personal data in a manner which complies with GDPR guidelines.
- Implement security measures that protect the database from breaches.
- Continuously monitor and manage the data to ensure that GDPR standards are being met.The new regulations will come into effect next month, and there is not much time left for businesses to update their systems. The sooner they get started on their data collecting techniques, the better.
Protecting Client Data
The new regulations have two main components to them. The first is about obtaining customer consent for data acquisition. The second relates to ensuring that the acquired data remains protected and secure.
Last year, the U.S. credit rating agency Equifax was hacked. Reports suggest that private and sensitive details of more than 143 million users were stolen by hackers. And everybody has heard about the Facebook Cambridge Analytica data breach that affected 87 million users .
Data breaches like these can severely shake the trust of users on private and public organizations. In the example of Facebook, a large number of users closed their accounts and Facebook lost $ 50 billion in stock value. This is why the EU has made organizations liable for the security of data that they collect.Adding security to the data can be achieved in two ways; Data minimization and use of pseudonyms.
Data minimization reduces the database by only retaining the information that is absolutely necessary for processing. Using pseudonyms involves translating data into numbers and unidentifiable strings through encryption. Both the methods add increase security to the database and reduce risk to the business and their clients.
Upgrading the Technical Infrastructure
The new technical infrastructure for organizations would need to be compliant with the regulations. Businesses would need to let their customers decide what information is shared and stored by companies.
A comprehensive data governance solution would let an organization quickly sort through its records and delete customer information for which consent has been withdrawn.
It would also allow businesses to review their current processes of data collection and processing. Updating to a unified governance model would also make it easier to create documentation on personal data used by the organization. A company would need to share this document with customers to stay compliant with the new regulations.
Benefits of a Unified Governance Model
A unified data governance model allows businesses to achieve better insights about their customers while staying compliant with the new regulations. Without applying a holistic approach, a business can become susceptible to oversight on regulatory compliance as well as data breaches.
Innovations are being led by unified data governance solutions. These techniques enable an organization to retrieve information about data objects, their physical location, characteristics, and usage. The technology is expected to help improve IT productivity while meeting regulatory requirements.
Bob Nieme, the CEO of Datastreams, has more than a decade of experience in data collection and frameworks. He is very optimistic about the new approach of governed access to data sources. He believes that companies would gain three benefits from a unified governance approach.
- It will help organizations comply with the new GDPR regulations and avoid penalties.
- Obtaining customer consent will improve their trust and willingness to share their personal data.
- Data governance would also reduce risks and improve security.
Planning for the Future in a GDPR Environment
While some organizations have taken steps to adapt to the changes, most businesses are not prepared for the May 25th deadline when GDPR goes into effect. Many of them are either not aware of the effects the changes will have or simply don’t know what to do about them.
Organizations that start the process of upgrade sooner will be at an advantage. It will allow them to build competitive advantage over rival businesses. Organizations that give their customers control over their personal data will also improve customer experience and stand out as reliable businesses.