Consequences of Data Loss
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Articles » Computers » Data-Recovery >> View Article
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Consequences of Data Loss
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By:
James Walsh |
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The reliance of individuals and organizations on the digitized data is constantly on the rise. Even if we go by the most conservative estimates, the rate at which the data is being generated is increasing by 80 percent every year. With it is also rising the business reliance on data.
All the departments of most of the modern organizations are completely computerized and interconnected. This interconnectivity has increased the reliance of all the departments of any organization on each other for their day-to-day functioning. In such an environment, the impact of a data loss incident can spread like a wild fire throughout the organization and can literally bring a company on its knees.
Though the most recent legal guidelines have made it mandatory for most of the businesses and organizations to meticulously back up and preserve their vital data, the actual compliance is not being practised with the same sense of urgency and concern. Considering the available statistics, the situation seems to be grim and pathetic.
As per a recent survey, about 40 percent of the small businesses do not back up their data at all. 60 percent of all the data in most of the companies and organizations is stored in laptops and desktops without being backed up. Even if the data is backed up, minimal attention is paid to its efficacy and practical utility in case of a data disaster. That is why, almost 60 percent of all the backups tend to fail in the hour of need.
The value of a given set of data and the consequences of data loss depend to a great extent on the nature of work of that organization or institution that generated that data. In data-sensitive departments like finance, defence, engineering and design, science and technology and R&D, which rely heavily on data input and interpretation for their growth, a data loss episode can simply jeopardize their functioning forever. In such areas, a data loss incident has the potential to demolish years of hard work and effort. Even if this data is somehow recovered, it may throw back the important projects by years. Not only this, but a data loss scenario can also lead to the loss or pilfering of precious intellectual property, which if translated monetarily, can mean millions of pounds.
In sensitive government departments like defence, law and order, health, public works, internal security, etc, a data loss incident can threaten the very credibility of a public organization or even a government. Though it is not possible to quote an incident where a government was brought down due to data loss, still as a possibility this premise may be considered to be viable and feasible. Considering the contemporary social setup where crime is getting highly digitized and terrorist organizations rely heavily on technology as a force multiplier, a data loss disaster can have consequences that may go beyond the realm of mere financial losses.
The consequences of data loss for companies and business concerns can vary from being mild and controllable to outright bankruptcy. Loss of data can hamper business life and annihilate business value. A recent survey conducted by IT Policy Compliance Group in a developed country like the US found that most of the businesses do not qualify the basic data handling regulations, thereby increasing the risk of data loss.
As per a research paper, 43 percent of the companies that experienced a serious data loss incident and had no recovery plan in place simply vanished from the commercial landscape. A data loss incident can have a chain reaction impact on a big business. Precious man-hours are lost as employees sit idle. Due to loss of vital transaction records and other important data, a business may simply come to a halt. Massive expenses may be incurred in getting hundreds of gigabytes of data professionally recovered.
A serious data loss incident can undermine the credibility of a company in the market. It may lead to loss of reputation as the management looks incompetent and careless. Businesses reporting a major data loss incident in the market can expect up to 8 percent loss in their stock prices and clientele. Court cases may be filed by the customers, creditors and shareholders.
Considering these drastic consequences of data loss for organizations, businesses and governments, it is vital that all the critical data is meticulously backed up on regular basis. Also recovery strategies should be planned and practised in advance to meet any kind of eventuality.
James Walsh is a freelance writer and copy editor. For more information on computer crime and Computer Forensics see http://www.fieldsassociates.co.uk
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