Four Implications For Business Leaders
Jackie Shoback is cofounder and managing director of 1414 Ventures, an early-stage venture capital fund focused on digital identity.
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In today’s business environment, data is one of the most valuable assets a company possesses. Customer data fuels insights, product/service development, personalized experiences and relevant go-to-market strategies. Many companies routinely share their customers’ data with their partners, which is a key component of their business model. Privacy laws such as CCPA (California Consumer Privacy Act) and GDPR (the European version) regulate the data storage, sharing and disclosure practices for consumer data in today’s digital economy and are disrupting these business models and the way data value transfer works.
In addition to data privacy, data security is also a key priority for all companies. Failure in either one of these areas can result in huge expenses—the average cost of a data breach in 2022 is $4.35 million. But even worse and beyond the dollar value is the long-term negative impact a data privacy breach or non-compliance will have on brand, reputation and trust erosion.
The more first party-data that is shared, the greater the risk of compromising both data privacy and security. Therefore, it’s a strategic obligation for business leaders to understand the difference between privacy and security, the changing business landscape, its impact on business models and how emerging technologies can help meet the new regulatory requirements and customers’ expectations.
Data Privacy
Data privacy is based upon the premise that personal identifiable information belongs to an individual and that they should be able to determine what, how, when and to whom their information is shared or communicated. Recent regulatory and market trends support more individual control, more consent and greater transparency, so companies holding customer data must meet these legal requirements.
The previous practice of consumer data being captured by one company and then sold to another without consent led to mistrust. In fact, privacy has become a competitive differentiator now. Take Apple with their iPhone privacy protection features, which provide…
