Automating Data Discovery and Data Classification for Enhanced Privacy

Data discovery and data classification go hand in hand when creating your data security plan. To effectively safeguard your customers’ sensitive data, both functions serve an essential purpose and you cannot have one without the other. The issue that many companies face—especially those at the enterprise level—is that manual data discovery and classification wastes time. This is an inefficient use of your team’s most valuable resource. Further, the larger the organization, the more likely that this nuisance becomes an impossible task. This is why companies should look to intelligent and automated data discovery and classification tools that can effectively address this growing problem.

Why Organizations Need Data Discovery and Data Classification

Before we dive into the benefits of automation, it’s essential to understand the important roles that data discovery and data classification play in your overall data security strategy.

First, there’s data discovery, which should always be an organization’s initial step in properly safeguarding sensitive data. After all, how can you protect data that you don’t know exists? Your data discovery solution needs to be able to find sensitive data wherever it lives, including all internal endpoints and all remote devices.

Once you find sensitive data, your team should be able to tag it properly to ensure authorized access and use. Additionally, proper classification means that your team can better find the right pieces of data to respond to a consumer’s “right to know” or “right to be forgotten” data subject access request (DSAR), which is common among data privacy regulations like the California Privacy Rights Act (CPRA).

Data discovery and classification should be at the center of your organization’s data loss prevention (DLP) strategies. Only then can your organization properly identify and protect its threat surface.

What Makes Data Discovery and Classification So Challenging?

According to an IDC report on the ever-growing datasphere, it’s predicted that businesses will generate 175 zettabytes of data by 2025, at a compounded annual growth rate of 61%. For a better sense of the scope of this challenge, understand that one zettabyte is equal to one billion terabytes or one trillion gigabytes.

This unprecedented data sprawl means that data is stored in every nook and cranny of enterprises’ IT infrastructure. As data volume and variety continue to grow, resources become more ineffective because data and information assets are harder to find. It becomes increasingly difficult to know with any certainty which files contain sensitive data like personally identifiable information (PII), intellectual property (IP), or other valuable or regulated content. As a result, organizations struggle to protect information adequately, meet compliance obligations, address duplicate and redundant data, and empower employees to find the content they need to do their jobs.

The report goes on to urge CEOs to act now to ensure their data strategy is focused on storing data in small sets (categories) according to business impact, rather than trying to analyze anything and everything. In other words, the more data organizations have to manage, the more data classification becomes a critical necessity. However, companies must first know what data they have and where it is stored before being able to classify and protect it.

How the Issue of Dark Data Affects Data Discovery

Among the mountains of data already stored and arriving daily in today’s businesses, is a secret hiding in plain sight: dark data. This is unknown and unused data, and it makes up more than half the data collected by companies, creating a considerable issue.

According to Splunk’s State of Dark Data report, 55% of all data collected by companies is dark data. Within this category lies two subcategories — data that they know has been captured but don’t know how to use, and data that they are not even certain that they have.

This uncertainty about where sensitive data resides can cause compliance concerns for a variety of reasons. For instance, dark data may contain sensitive customer information like location data or other other metadata that may have been improperly recorded. 

When companies do not know where all the sensitive data is stored, they cannot be confident they are complying with consumer data protection measures. At the same time, data that is misused or improperly protected makes businesses vulnerable to legal action or theft from hackers.

Due to the large amount of data that companies collect and create on a given day, manually discovering data throughout their enterprise is an insurmountable task. Instead, companies must look to automating their data discovery efforts.

Automated Data Discovery: How It Works and How To Leverage It

Today’s organizations do not have to be in the dark about their data. Intelligent and automated data discovery can tell them exactly what data they have and where it resides.

Automated data discovery and classification tools work by scanning endpoints or corporate network assets to identify resources that could contain sensitive information, such as hosts, database columns and rows, web applications, storage networks and file shares. Sophisticated systems can find data located in all file types, including .doc, .xls, .pdf, .txt, .ppt, .zip, csv, and .xml, among many others.

These tools should be able to search unstructured data, cloud repositories, endpoints and on-premise servers to find all of the locations where data can be stored. If not, companies risk sensitive data going undiscovered and unprotected.

Automated Data Classification: A New Schema for New Privacy Laws

Many companies face significant challenges when it comes to data classification. A Gartner report on overcoming the pitfalls stated, “Most data classification implementations continue to be unexpectedly complex and fail to produce practical results. CISOs and information security leaders should simplify schemas, leverage tools and allow for implementation flexibility to make classification valuable for the entire organization.”

Similar to data discovery, companies face hurdles when it comes to classifying the sensitive data they are able to find. Data is inextricably linked to other pieces of data (such as a person’s name tied to an address and a purchase order) and companies need to process data for different purposes (such as marketing and shipping) in different capacities. Companies must also follow a consumer’s request to opt out of certain data processing measures but still retain that same data for legal reasons or other legitimate purposes. With large data sets, classifying data manually for any of the above scenarios would be near impossible for almost any organization.

An intelligent automated data classification platform can replace outdated or ineffective automated processes, as well as manual processes. The right automation system can aid in streamlining data classification and automatically analyzing and categorizing data in real-time, based on predetermined parameters.

Organizations often struggle with their data classification programs because they approach them mostly as manual processes. However, classifying data manually is simply too labor-intensive, time-consuming, and error-prone to be a practical solution for all but the smallest companies. In particular, manual data classification suffers from the following issues:

  • Inaccuracy: Busy employees often fail to classify data at all or simply pick the first tag in the list in an attempt to expedite the process. Cutting corners leads to inaccuracies and security vulnerabilities.
  • Inconsistency: Different people within a team may classify similar documents in different ways.
  • Inflexibility: As a company’s sensitive data requirements and policies change, team members don’t have the time or inclination to update the tags on terabytes of existing data.
  • Failure: As users realize that data is not classified correctly, they will quit trusting the process and the whole project fails.

Automated data classification overcomes these limitations by making the process reliable, accurate and continuous. For example, a sophisticated platform can spot personally identifiable information (PII) by looking for data patterns, such as names, dates of birth, addresses, phone numbers, financial information, health information, and social security numbers. Automated systems can also re-classify data as needed, such as for updates and changes within the business or from changes in compliance regulations.

What To Expect From an Automated Data Classification Tool

There are three general ways that companies can approach data classification: fully manual, fully automated, and a hybrid of the two. However, even small organizations that haven’t considered full automation realize the potential after seeing data classification automation in action. Intelligent automation can eliminate the work hours and human errors inherent in manual processes.

Today’s automated data classification software and tools vary in terms of usage, access and enforcement capabilities. Common features do include:

  • Pull-down menus of available data classification selections for a user or file type
  • Content-aware capabilities to suggest a classification for review and change, or confirmation by the user
  • Automatic selection of the appropriate classification levels based on content analysis engines
  • Classification lifecycle policy enforcement, such as preventing a user action unless the file is classified, or preventing an unauthorized classification change
  • Some limited integrated data loss prevention (DLP) functionality, often around specific use cases, such as email

Every organization should assess automated data classification options available in the marketplace and determine which solution can provide them with the capabilities they need to take their data privacy protection to the next level. Ideally, organizations should choose a platform that is purpose-built to deliver the key functions of deploying robust data privacy programs.

How Automated Data Discovery and Classification Tools Support Cyber Resilience

Cybercrime is undoubtedly on the rise. IBM’s Data Breach Report 2022 found that 83% of organizations studied have had more than one data breach, and the average total cost of a breach is $4.35 million. However, breaches at organizations with fully automated data classification saw an average cost savings of $3.05 million, highlighting the importance of comprehensive security measures.

What’s more, organizations without any automation in place take much longer to uncover breaches. Last year, the average detection time for breaches was 277 days. This extended period of time can significantly increase the costs and recovery time from a breach. By instead implementing a data breach detection tool based on fully automated classification, your organization will be better prepared to prevent data breaches and better able to address them when they do occur.

Automated Data Discovery and Classification for Data Privacy Readiness

Data discovery and classification form the bedrock of any organization’s data privacy program because you must first know where your sensitive data resides and what levels of protection it needs. Without those two fundamental steps, your company will not be able to get a full picture of its data for proactive privacy compliance.

Data discovery and classification are essential components of Spirion’s five-step data privacy management framework. In fact, these two processes are incorporated into the first two steps of the framework. By using this model, businesses can take a strategic approach to data management that not only protects consumer privacy, but also increases business benefits:

With the vast amounts of data that organizations handle, manual data discovery and classification are nearly impossible. Teams should instead consider using automated data discovery and classification tools like Spirion’s Sensitive Data Platform. This powerful software can improve accuracy and streamline workflows, reducing confusion across departments and minimizing wasted time. To see how Spirion’s Sensitive Data Platform excels in accurate and automated data discovery and classification, you can watch a free demo here.