Updated: Sep 21, 2022
The world we live in has already undergone the information Big Bang. What remains is the volume and variety of data expanding at an ever-increasing velocity. The data itself is not an issue. Rather, used right, it has the potential to accelerate the growth of any business.
It is how recommendation engines, search algorithms and platforms use it that causes problems. It intrudes into privacy. And that has become the most pressing question of this decade – maintaining data privacy. With GDPR and CCPA in place, companies needs must comply.
But ensuring data privacy and confidentiality is a big mountain to climb. Most teams responsible for compliance, still struggle with a privacy budget. CEOs and top executives tend to hit the ignore button instead of the investment button.
The reason is straightforward. The C-suite has different priorities. Their goal is to hit targets and capture a bigger market share. Not to ensure that the company is privacy compliant. So, how do you convince them to invest in tools that uphold privacy?
Educate the C-Suite.
One cannot understand what one does not know. CEOs are not privacy experts, so they fail to grasp the vital need for it. The key to gaining their attention is constant education. Communicate the risks associated with breaches, and articulate the business benefits of tools that ensure confidentiality.
Speak the language of money.
Education is effective only when it is imparted in a language the person understands. For top executives, that language is money. Demonstrate to them the cost of a data breach and you’ll have their full focus.
A good starting point is to clarify the penalties. For instance, landing on the grey side of GDPR can rack a bill of "up to €20 million, or 4% of annual global turnover – whichever is higher."
Another is the cost of a data breach, which can have a devastating effect on the bottom line. It takes an average of 9.2 months for a company to contain a breach. That time amounts to downtime, lost customers, and reputational damage, costing a business in the US about $8.64M.
Move beyond the checkbox into ROI.
Investing in data tools that keep privacy-first doesn’t merely mitigate risk to the business. It brings competitive advantage and business value in the form of greater consumer trust and loyalty, better investor appeal, and more operational efficiency.
For every dollar spent, the average organisation gets $2.70 in associated benefits. So, pitch the privacy budget not as a checkbox to be completed, but as a strategic decision that moves the needle for the entire business.
Make the risk real and personal.
It's easy to point out laws and regulations like the Gramm-Leach-Bliley Act, which compel businesses to keep sensitive data safe. That would garner you a CEO’s attention. But to persuade and motivate them to invest in a privacy budget, more must be done.
The first step is to highlight organisations in the same niche that have been hacked or breached. The second is to turn the tables and make the risk personal by stimulating a breach. Then demonstrate how the violation adversely impacted revenue, customer relations, and operations.
Offer a worthwhile solution.
Persuading a CEO to invest in data privacy is half the journey. The other half is offering a solution that works. Without one, the privacy budget would merely be left on the back burner.
When recommending solutions, pick three instead of one. The first and the last can be established legacy players with low initial investment but requiring hefty maintenance cost. The middle choice can be an upcoming solution that leverages automation and requires minimum maintenance.
It’s a time-tested persuasion technique and the psychology underlying it is simple. When given a choice, a person perceives a sense of power. In this case, the power to decide which solution is the best, which would typically be option number two.
Not investing in a privacy budget: Is it worth the risk?
48% of consumers accept that they stopped using a service or purchasing a product from a brand due to privacy concerns. On the other hand, 54% of them feel that organisations don’t utilise data in a way that benefits them.
As we said before, it is not data, but the fear of its security and privacy that causes concern. No wonder the average privacy budget doubled to $2.4 million in 2021. The risk of not investing in tools that ensure data privacy is clearly too high.
However, achieving an X amount of privacy budget must not be your entire objective. Sometimes even a significant sum is like a band-aid on a leaking dam. It leaves the business extremely vulnerable. The answer is spending it on the right tools. But that's a discussion for another day!