Partner Article

Data – the new currency of business

Data - the opportunities offered and risks posed – is a critical technology tool for businesses to master in order to gain competitive advantage, writes Martin Tyley, risk consulting director, KPMG.

While the scale, rate and nature of technological change continues at a staggering pace, it is actually the associated change in human behaviour that requires the most attention.

We are finding many businesses fail to turn their data into value, unsure how to move from being ‘collectors of information’ to ‘users of insight’.

After all, knowledge does not always equal power and collecting information for its own sake increases the risk of organisations drowning under a sea of information. The real test of a healthy analytics capability is whether it keeps an organisation focused. For example, where cash-flow is tight, does data analytics highlight which products and services need to be stopped or improved?

It has been suggested that data is becoming the new currency of business, almost on a par with capital and labour. Information is certainly at the core of most organisations, but questions about how to extract real value remain because the journey from traditional business analytics to business enabler requires organisations to fundamentally rethink how they collect, analyse, distribute and monitor their data.

As a result, the leadership in many organisations increasingly demands data that it is beyond the capabilities of its IT resources to deliver. It will be the businesses that have combined their hunger for data with an appetite for more than capital investment and new software packages that will win the day.

Of course, if data is considered a valuable asset, then holding it represents a significant risk too.

There are proposals to fine organisations two percent of their global turnover if they become victims of hacking and to require those operating in Europe to report cyber security breaches.

However, as the majority of data loss incidents are caused by malicious hacking, I’d suggest that most organisations are already very focused on tackling the problem. Threats to fine them represent recognition that cyber security is a real and growing concern and will increase pressure on cyber security, but with the growing use of mobile devices and the proliferation of personal data, the need to protect personally identifiable information is already understood.

According to our Data Loss Barometer, hacking of information held by businesses has jumped globally from only 8% of total incidents in 2010 to 52% in 2012. It’s now big business, driven by a desire to steal or re-sell sensitive material.

‘Personally identifiable information’ such as names and credit card information, was by far the biggest reason for breaches of security in 2012, at 46%, followed by password information that accounted for only 16% of incidents, although this had increased from just 5% in 2011.

Our tips for reducing data loss are to:

• Review the amount of data leaked online and through public facing documents of metadata. These are easy targets for hackers.
• Ensure internet-facing systems are kept fully patched and update.
• Educate everyone within the organisation about the value and sensitivity of the information they possess and how they can protect it physically and online.
• Back up employee training with procedures and a corporate culture that takes security of information seriously.

This was posted in Bdaily's Members' News section by KPMG .