Data loss can severely impact on companies. However, this impact is not the same for every company. For example, an R&D company is bound to have confidential data regarding recent inventions or products. Therefore, even when it loses this data, the company cannot place its trust on any given data recovery company or software.
In this case, the R&D company is bound to choose the most reliable and trustworthy data recovery company to ensure the confidentiality of its data and guaranteed success of the data recovery operations. Therefore, the cost of data recovery will also be much higher than other companies. The companies that are hardest hit by data loss incidents are R&D companies, banks and financial institutions, and film and advertising industry. We will discuss the reasons for this in the following section.
Impact of Data Loss on Financial Institutions
Banks and financial institutions earn their money on the basis of millions of transactions that take place on an everyday basis. Imagine that you want to invest £1000 in the stock market on a particular day but your stock brokerage company is unable to conduct its business on that day due to a data loss problem. If the business deals with 200 such transactions on an everyday basis, then the business will suffer a loss of £200,000, and this is just the amount of loss for one day. The longer it takes for the company to recover its data, the larger its total losses will be.
Since financial institutions and banks deal with money and customers on a real-time basis, it is absolutely essential for them to keep their business running 24X7. As more and more customers get used to the convenience of online banking and transacting, it is hard for them to handle any delays. In today’s information age, delays means loss of business and loss of business means monetary losses. Customers want to be assured that their banks and financial institutions will continue to do “business as usual” even in the event of an emergency.
Banks, brokerage houses, and other financial institutions take pride in maintaining their huge customer databases because it is by serving these customers in the most efficient and reliable way that they keep these customers from going to their competitors. Now, imagine if any financial institution were to lose this customer database in a data loss incident; not only would the bank lose its valuable database, but it would also put its customers at a huge risk because financial data is extremely confidential in nature.
A customer will only put his or her money in your financial institution if he or she trusts your company. Such types of data loss incidents will make the customer doubt your trustworthiness and he or she is bound to take his or her business elsewhere.
Impact of Data Loss on R&D Companies
R&D companies tend to spend huge amounts of money on creating new products or inventions. It is not the kind of field wherein immediate investment reaps immediate results. On the contrary, R&D is such a field wherein the huge amount of investment has to be put upfront but the monetary rewards of this investment might not be realised for many years to come.
Some R&D projects take several years to get completed. Therefore, the time, effort, and investment involved are also huge. Losing R&D data can spell disaster for an R&D company because it would result in huge losses.
Since every company tries to gain market share through its innovative techniques, losing R&D data to a malicious user can have even more disastrous consequences. If a competitor company gets hold of this valuable R&D data, it can exploit this data for its benefit. Therefore, the R&D company is not only likely to incur huge losses but also lose a substantial portion of its market share to its rival company.
Impact of Data Loss on the Film and Advertising Industry
Films and advertisements require a lot of time, money, and effort. There is a use of lot of external technical expertise and resources that cannot be replicated easily. For example, a film requires actors, external technical professionals, an external location, and external recording facilities. It requires a great deal of coordination to have access to all these resources in such a way that the film gets completed in the shortest time possible and in the most economical way.
Losing a film or an advertisement footage would mean losing all the financial resources that went into making that footage. Therefore, a film company might have spent millions of dollars in producing a movie, but a data loss incident would translate this expenditure into losses without any benefit whatsoever.
