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Why is Data Security Important?

Why is Data Security Important

People generally agree that data is the new oil. Since data is so valuable and hard to mine and collect, your company must have a strict data security policy. Regardless of the size of your company or the industry in which it operates, data security should be one of your top priorities. In this article, we will understand why is data security important, its meaning, types, and more.

What is Data Security?

Data security is the process of protecting digital information from corruption, theft, or unauthorised access throughout its entire life cycle.

Its techniques and technologies include physical hardware security (e.g., storage devices), logical software application security, administrative and access controls, organisational policy standards, and other practices.

Why is Data Security Important?

Data security fundamentals include availability, confidentiality, and integrity, organisations that fail to keep these elements in check may come to regret it or worse. The following are some of the most important reasons for implementing these measures, particularly for organisations that handle not only their data but also customer data.

  • The primary goal is to safeguard organisational data, which includes trade information and customer information. Cybercriminals may gain access to the data for malicious purposes, jeopardising customer privacy.
  • For the business to continue operating legally, it is essential that it complies with all applicable government and industry regulations. To protect consumers’ privacy, there are regulations in place.
  • It is also important because a data breach can expose an organisation to litigation, fines, and reputational harm.
  • Data breaches can result from inadequate data security practices, exposing organisations to financial loss, consumer distrust, and brand erosion. Customers who lose faith in a company are more likely to go elsewhere, and this devalues the brand.
  • A breach that leads to the loss of trade secrets and intellectual property can make it harder for an organisation to come up with new ideas and remain profitable in the long run.

Why is Data Security Important (1)Why is Data Security Important (1)

Types of Data Security

By understanding the various types of data security tools that are available, businesses can make sure that their internal policy and privacy are top-notch. You can select the type of tool to use based on the level of security you want to implement for data protection. Here are the various types of options available to you:

1. Data masking

The data masking process involves replacing real data with fake data while keeping the data format constant. You can mask your data by replacing it with fictitious information, shuffling the words or numbers, or encrypting it entirely. A data masking tool is an example of tokenization.

Companies use data masking tools to hide information that they must present to customers, investors, or interview candidates. In such cases, you must demonstrate to customers and investors what your company or product does without disclosing company data to others.

2. Firewalls 

A firewall is a software application that monitors and filters incoming and outgoing network traffic in accordance with the data security policy of your organisation. It functions as a gatekeeper, inspecting each web page accessed through your company’s private network for potential data theft.   

As an initial security layer, you should install a firewall on employees’ devices. It will block the IP addresses that you believe are a threat. 

3. Authentication and authorisation

Authentication and authorisation work together as a data security tool that businesses must use to protect their enterprise data.   

As part of the policy, only authorised individuals should be able to access the system. Set up authentication tools such as two-factor or multiple authentications to ensure that only authorised users have access to company data.   

Users can gain access to a system by going through an authentication process that includes entering a password, a fingerprint scan, or an OTP. 

4. Data backup 

While it is recommended to use various types of data security tools to protect company data, you should also invest in data backup and recovery systems.

In the unfortunate event that your data is compromised and stolen, you should keep a backup of everything. This will ensure that the data breach has no impact on day-to-day business operations.

Many businesses back up their data using the 3-2-1 strategy. Simply put, for each data set, make three backup copies, store them on two storage media devices, and keep a copy of the backup in a secret off-site location for added security.

5. Encryption

Every company has data that must be approved by various parties for the work to be completed. Customers’ card details, for example, must be approved by banks and payment gateways before they can make digital payments. In such cases, businesses are required to encrypt payment information so that no one can access it.

The most significant advantage of encrypting data is that even if hackers obtain it, they will be unable to use it.

Biggest data security risks

Organisations face an increasingly complex landscape of security threats, with more sophisticated attackers launching cyberattacks. Among the most serious threats to data security are:

1. Accidental data exposure

Many data breaches are caused by employees accidentally or negligently exposing sensitive information, rather than by hackers. Employees who are unaware of their company’s security policies can easily lose, share, or grant access to data to the wrong person, or mishandle or lose information.

2. Phishing attacks 

In a phishing attack, a cybercriminal sends messages, typically via email, short message service (SMS), or instant messaging services, that appear to originate from a trusted source. Malicious links or attachments in messages direct recipients to either download malware or visit a spoofed website, allowing the attacker to steal their login credentials or financial information.

These attacks may also assist an attacker in compromising user devices or gaining access to corporate networks. Phishing attacks are frequently combined with social engineering, which hackers use to trick victims into disclosing sensitive information or granting access to privileged accounts.

3. Insider threats

Employees are one of the most serious data security threats to any organisation. Insider threats are individuals who intentionally or unintentionally endanger their own organisation’s data. They are classified into three types:   

  • Insider compromise occurs when an employee is unaware that their account or credentials have been compromised. An attacker can carry out malicious activity while impersonating the user.   
  • Malicious insider: An employee who actively attempts to steal data from their company or cause harm for personal gain.   
  • Nonmalicious insider: An employee causes harm unintentionally, through negligent behaviour, or by failing to follow security policies or procedures or being unaware of them.   

4. Malware

Malicious software is typically distributed via email or web-based attacks. Malware is used by attackers to infect computers and corporate networks by exploiting flaws in software such as web browsers or web applications. Malware can cause severe data security incidents such as data theft, extortion, and network damage.

5. Ransomware  

Ransomware attacks pose a significant data security risk to businesses of all sizes. It is a type of malware that seeks to infect devices and encrypt their data. The attackers then demand a ransom fee from their victim, promising to return or restore the data in exchange for payment. Some ransomware variants spread quickly and infect entire networks, even bringing down backup data servers.

6. Cloud data storage

Organisations are increasingly moving data to the cloud and going cloud-first to facilitate easier collaboration and sharing. However, moving data to the cloud can make it more difficult to control and protect against data loss. The cloud is essential for remote working processes in which users access information via personal devices and less secure networks. This makes it easier to share data with unauthorised parties, either accidentally or maliciously.

Data Security best practices

A company can take several actions in addition to the data security technologies mentioned above to ensure effective data security management.

  • External and internal firewalls: Using external and internal firewalls protects data from malware and other cyberattacks.   
  • Data security policy: An organisation should have a clear and comprehensive data security policy that all employees are aware of.  
  • Data backup: Backing up all data ensures that the business can continue operating normally in the event of a data breach, software or hardware failure, or any other type of data loss. Backup copies of critical data should be rigorously tested to ensure adequate data loss insurance. Furthermore, backup files should be subjected to the same security control protocols as primary systems.   
  • Assessment of data security risks: It is prudent to conduct regular assessments of data security systems to detect vulnerabilities and potential losses in the event of a breach. The assessment can also detect out-of-date software and misconfigurations that must be corrected.   
  • Securely store sensitive files: The software should be able to regularly classify sensitive files and move them there.   
  • Monitoring data file activity: The software should be able to analyse data usage trends for all users. It will allow for the early detection of any anomalies and potential risks. Users may be granted access to more data than they require for their job. Over-permission is a practice, and software should be able to profile user behaviour to match permissions with their behaviour.   
  • Application security and patching: This refers to the practice of promptly updating software to the most recent version as patches or new updates are released.   

Employees should be trained in the best practices regularly. They can include password training, threat detection, and social engineering attacks. Employees who understand data security can help the organisation’s role in data protection.   

Why is Data Security Important (1)


The importance of data security to your business guarantees your undivided attention so that you can handle the situation more effectively. You should have a solid policy in place for both employees and vendors. Having strong data security checks and balances in place will take time and is not something you can do overnight.


1. What is Data Security?

Ans: Data security is the process of protecting digital information from corruption, theft, or unauthorised access throughout its entire life cycle. It includes hardware, software, storage devices, and user devices, as well as access and administrative controls and organisational policies and procedures.

2. Why is Data Security Important?

Ans: Organisations are legally required to protect customer and user data from being lost or stolen and falling into the hands of the wrong people. Data security is also necessary to avoid the reputational risk associated with a data breach. A high-profile hack or data loss can cause customers to lose trust in an organisation and take their business elsewhere.

3. What are the different types of data security?

Ans: Encryption, data erasure, data masking, and data resiliency are some of the most common types of data security that organisations should look to combine to ensure they have the best possible strategy.

4. What is the function of data security?

Ans: The objective of data security functions is to prevent data breaches, reduce the likelihood of data exposure, and ensure regulatory compliance. The role of data security within any organisation is to ensure the ongoing safe and secure use of private data while minimising exposure risk.

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