When the EU GDPR (General Data Protection Regulation) took effect in 2018, many organizations – particularly on this side of the Atlantic – considered it a bureaucratic nightmare.
For most U.S. businesses, Europeans are a fraction of their customer and client base, yet they were told to overhaul their data protection practices or face multi-million-dollar fines.
Unable to justify the cost of doing this – but understanding the threat of non-compliance – some decided to cut off EU residents altogether.
Although this guarantees that the organization won’t violate the GDPR, it also prevents it from reaping the benefits of compliance – of which there are many.
The GDPR is designed to help organizations manage personal data more effectively, mitigate the risk of data breaches, and build better relationships with customers and clients.
We explain three ways it does that in this blog.
1. It enhances your reputation
There is a simple truth at the heart of the GDPR: People don’t want their personal data misused, whether that’s because cyber criminals have breached it or because organizations are using it unethically.
If organizations are to gain customers’ trust, they must assure them that their data is being used securely and responsibly.
According to the 2019 Data Privacy Benchmark Study, 41% of organizations that did that said it gave them a competitive advantage.
That’s because nowadays people better understand the dangers of personal data being misused, and organizations face stronger media scrutiny for violations – the effects of which can linger for months or even years.
What’s more, the GDPR makes it easier for individuals to learn for themselves whether organizations can be trusted. All they need to do is submit a DSAR (data subject access request), which enables them to learn what information an organization is processing about them and how it is being used.
2. It provides business opportunities
The GDPR can also help you build relationships with clients.
Under the Regulation, organizations are urged to act cautiously when choosing partners and suppliers, because there are regulatory repercussions for data breaches involving third parties.
When sharing personal information, data controllers and data processors are required to meet the GDPR’s Article 5 requirements, which cover six data processing principles:
- Lawfulness, fairness, and transparency
- Purpose limitation
- Data minimization
- Storage limitation
- Integrity and confidentiality
If these principles aren’t adequately addressed, or the data processor fails to uphold its contractual obligations, both parties could be held accountable under the GDPR and face fines.
Organizations should therefore seek assurances from potential partners regarding their data protection practices.
3. It drives efficiency and innovation
You only need to look at the organizational changes resulting from COVID-19 to be reminded of the saying “necessity is the mother of invention.”
After years of dragging their heels, organizations quickly learned that remote working – something that many employees had been clamoring for – is not only possible but also beneficial.
Likewise, organizations reluctant to commit to better data protection practices will learn that changes enforced by the GDPR drive innovation and will help them run more smoothly.
According to the 2019 Data Privacy Benchmark Study, 42% of organizations agreed that privacy investments enabled greater agility and innovation, while 41% said that they achieved greater operational efficiency by organizing and cataloging their data.
One area of compliance that organizations can look at for operational benefits is purpose limitation. This forces organizations to remove data when it’s no longer needed.
The primary goals of this are to ensure personal data is only stored when there’s a lawful basis to do so and to reduce the damage in the event of a data breach.
However, there’s a secondary benefit in that it ensures organizations avoid amassing enormous archives, which require regular maintenance.
Furthermore, as the number of records you store grows, you will find it increasingly hard to find relevant information and may also need to purchase more server space or expand your filing system.
This is entirely unnecessary if you no longer need or use the data. As such, the cost of auditing your systems to ensure purpose limitation requirements are met may actually save you money in the long term.
How you can get the most out of the GDPR
Are you ready to reap the benefits of GDPR compliance? Get started with the help of our GDPR Gap Analysis service.
Our data protection consultants will assess your organization’s privacy management and data protection practices, determining the requirements you need to address.
Using our unique GDPR RADAR™ methodology, we’ll show you how to boost your data protection practices based on nine key compliance areas.