How to effectively curb the growing data-breach related costs
31 July 2018
$3.9 million – that is the average cost generated by data loss for companies according to the “2018 Cost of a Data Breach Study” report prepared by Ponemon Insitute for IBM.
The costs related to data breach have risen by 6.4% year-on-year, however only in 30% of cases the IT system is to blame. In other instances errors may be attributed to a IT system gap or insufficient protection of company data.
The most frequent cause of data loss, accounting for 42% of all the infringements, is malicious or criminal action against the company. On the other hand, in 28% of cases the problem is triggered by a human error, as for instance an employee who violates the procedures or does sloppy work while operating an application.
The faster the better
Analysts at Ponemon Institute indicate that the response time to a data breach event and company’s digital maturity have the greatest impact on mitigating the costs related to data loss. The more technically mature an organisation is, the faster it can react to negative events. On average, if a company identifies a data leak within 30 days, it saves a million dollars. Globally, however, the average time needed to detect a data leak is as long as 69 days, which may indicate that it is crucial to implement solutions that will ensure a swifter reaction.
2 ways to reduce data-breach costs
Nowadays the two most effective factors in mitigating data breach-related losses are:
1. An incident response team. Organizations that have set up such teams are best capable of reducing their losses, saving on average even $14 per each lost data record.
2. Deployment of an AI platform that ensures cybersecurity. AI helps low-er costs – on average, by $8 per each lost data record.
It’s the first time that experts have shown the potent role of artificial intelligence as a tool that automatically monitors resources and signals violations. The average cost of a breach for organizations that fully deploy security automation is $2.88 million. But without automation, estimated cost is $4.43 million!
The research conducted for IBM also shows that the costliest cases of data losses are reported in the US and the Middle East. At the other end of the spectrum, we can find Brazil and India, where data losses generate relatively low costs. Costs associated with data loss amount to, on average $7.9 million in US, when, in India it is only $1.8 million.