Insufficient cyber security putting consumer data as risk report suggests
Companies are not doing enough to ensure the security of consumers’ personal data, a report has suggested.
More than 90 per cent of companies have experienced a security breach that has compromised customer information, data collected by Capgemini Consulting’s Digital Transformation Institute has shown.
46 per cent of companies have no clear framework for policy on safety and security of customer data.
With customer experience and more specifically personalisation being identified as key areas where companies need to grow and expand to monetise, collection of personal data is on the rise.
Over 80 per cent of executives at large organisations polled said they thought customer insight was a priority to their operations.
58 per cent said it empowered marketing and product development, 57 per cent said it supports operations and 53 per cent say it is useful for sales.
Therefore, this is putting greater volumes of data at risk of being stolen.
The EU’s General Data Protection Regulation (GDPR) is set to come into force in 2018, and will combat the lack of security for consumer data.
This may lead to firms losing up to four per cent of their annual turnover through penalties if they do not comply with the new regulations – a total of around $320 billion (£242 billion).
It is likely that a significant number of penalties will be awarded if UK companies do not change their protocol before 2018 as over 50 per cent said their data policy did not comply entirely with industry regulations.
Only 36 per cent of UK companies said they had clearly outlined policies regarding customer data collection, which was the lowest proportion of any of the markets the survey was carried out in, according to Consumer Insights: Finding and Guarding the Treasure Trove, which surveyed 300 executives from 86 global consumer products firms.
Consumers are becoming increasingly aware of the risks of giving out personal data and the insufficient security in place to protect it, with 91 per cent polled saying they felt the distribution and use of their personal data by large organisations was out of their control.
Kees Jacobs, consumer goods and retail lead at Capgemini, said: “Finding the balance between sensitively handling consumer data, ensuring that information is secure and using consumer insights to deliver a better experience is extremely challenging.
“Consumer trust is at stake, and in many instances it’s clear that the risks have either been overlooked or ignored. This is an issue organisations have to tackle quickly if they are to avoid not only reputational damage but serious sanctions.”