Despite differences in scope, size or industry, businesses of all sizes do one thing rather constantly: produce data. And given the accelerated digital transformation we’re currently living, data loss is a more serious business concern than ever before, which is saying a lot.
Although though data loss can have serious implications for any business, an alarming number of businesses don’t have any disaster recovery plans in place.
The general impact of data loss
A data breach can affect your business in ways which rock the foundation of your entire operation. These include disruptions to business continuity, productivity and cost-effectiveness.
Disruption of business continuity
Data loss is a major inconvenience that disrupts the day-to-day function of any information-based business. When important files and documents are compromised or lost, your business has no choice but to spend time and resources recreating or recovering these files rather than maintain the functions essential to your business. The resulting slowdown of operations is, well, bad for business. And while you might be able to locate hard copies of your data, they may not be as up to date as the digital ones that were lost. Not to mention, data loss caused by corruption or viruses makes it particularly difficult to determine the extent of the data lost.
Damage to productivity
Data loss, unsurprisingly, also sets back productivity timelines and can trigger a loss of customers—particularly if it is accompanied by security breaches. When sensitive data is stolen or otherwise compromised, your company is obligated to disclose the breach to clients, which, in turn, makes it challenging to hold on to their trust, respect and loyalty. Even if your company can recover, you will need to budget time for rebuilding client relationships.
Leaving data unprotected can be very expensive as well. According to an IBM study ↗, the average cost of a data breach to a US company is $8.6 million—higher than anywhere else in the world. The same study found that it could take over nine months to simply identify and contain a data breach! Meanwhile the cost to Canadian companies ↗ is still a breathtaking $7 million.
The real consequences of data loss: what the numbers tell us
Not quite convinced that a data recovery plan is worth it? Here are a few more stats to help paint a real-world picture of the actual costs and consequences of data loss.
1. Two out of three medium size businesses have suffered ransomware attacks in the last 18 months
According to the latest 2022 MSP Threat Report ↗, two out of three midsize businesses have suffered a ransomware attack in the last 18 months, pointing to a rather shocking increase in the size, severity and cost of these malicious attacks year on year. The average downtime ↗ caused by a ransomware attack was 20 days in Q4 2021. What’s worse, organizations that pay the sum demanded only get back 61% of their data on average ↗, with just 4% getting all their data back.
2. 96% of businesses experienced an outage in a 3-year period
A LogicMonitor study ↗ reported that a whopping 96% of organizations have experienced at least one outage in the past three years and 95% have experienced at least one brownout. The same report revealed that IT decision-makers believe 51% of outages and 53% of brownouts are avoidable—as is the lost revenue, compliance failures and lost productivity that accompany them.
3. 28% of data breaches involve malware
According to Verizon’s 2021 Data Breach Investigations Report ↗, malware was implicated in about 15% of data breaches, pointing to the importance of quality, up to date antivirus software to help prevent this type of data loss.
4. 82% of breaches involve human error
According to the 2022 Verizon Data Breach Investigations Report ↗, 82% of breaches are caused by attack vectors that involve human error, even if they aren’t understood as the direct cause of the breach. This would include social engineering attacks, phishing, spear phishing, errors and misuse/transgressions. This is a reminder of how important it is to ensure that employees receive the proper training and subsequent monitoring, and that they aren’t granted access to data except where necessary to perform their jobs.
5. Hard drive crashes account for the highest percentage of data loss
According to data from Kroll Ontrack ↗, 67% of data loss is caused by hard drive crashes or system failures. It may be worth noting that the same study found 14% of data loss was found to be caused directly by human error, and 10% by software failures.
Avoiding data loss
Now that you’re equipped with some sobering statistical knowledge, you’re that much closer to taking the appropriate precautions:
- Have a data recovery plan in place to ensure that you know what to do in the event of disastrous data loss.
- Don’t just have data stored on a hard drive in the office—have data stored on a cloud-based solution as well. The more backup solutions you have, the better.
- Test your data frequently to ensure it is backing up successfully and is up to date.
Avoiding data loss should be a top priority for any business. Luckily, improving your security posture can go a long way toward lessening your risk.