Does too much focus on privacy hinder the full use of AI?

Customer data must be shielded and, if properly protected, can still be used for valuable analysis

In 2006, British mathematician Clive Humby declared that data is the new oil – and could therefore be the fuel source for a new, data-driven industrial revolution.

Considering he and his wife helped Tesco earns £90 million he should know from the first attempt at a Clubcard. And it looks like the derricks are actually pumping that informational black gold to the surface: the global market for big data analytics is expected to more than $745 billion by 2030– and while this may not be the most reliable metric, Big Tech is throwing billions at AI at a pace described as “some of the largest cash injections into a specific technology in Silicon Valley history.”

That's what we're told is happening. But is it real? Do organizations actually and consistently use all the data they have, and therefore use it for competitive advantage and innovation?

More worrying is the question: Are the safeguards we have in place, such as GDPR and other global data privacy restrictions, deployed in a way that makes them unnecessarily restrictive to the full flow of AI-driven innovation?

We were keen to understand where organizations really stand with this exploitation, and whether data generation and a defined, repeatable workflow are really in place.

Specifically, we wanted to check whether organizations are truly utilizing the full potential of their data and operating with the right levels of protection for that data, and whether that data can be accessed within a timeframe that is useful to the business.

That's why we surveyed and spoke to 600 CIOs, CTOs, CISOs, heads of data and data managers in organizations across industries, from aviation to retail and telecommunications.

And it was interesting to hear firsthand what they told us about the real state of data processing.

Innovation through data, yes. But enough of it? No

What these practitioners told us is that while they absolutely see the potential for innovation and profit opportunities in their data, they struggle to capitalize on it cost-effectively.

For example, 56% of all respondents said they have already achieved significant improvements in both CX and EX (customer and employee experience); 44% confirmed that data access has directly led to a profit benefit of 6 to 10%; a very impressive 20% estimate that figure to be between 11 and 20%. By 2023, more than half (57%) of the organizations we spoke to had introduced new products and services based on insights gained directly from mining their data.

But 32% admitted it could take three to six months to access the data they need to use apps for that purpose. 37% said this process could take one to two full months, and only a small percentage, just 2%, said they could access the data in “less than a week” or immediately.

To clarify what we mean by 'data', we are not talking about transactional data such as EPOS data; we mean the potentially good data about customers and their behavior and attitudes.

If we say that, CISOs and data protection officers will immediately label it as 'sensitive and classified data', which will lead to this data being put into purdah and many doors being closed around it.

And that is true; I don't mind others knowing what kind of sandwich I bought at the gas station, for example, but I do mind if you link that purchase to my NI number.

If the data protection wall is placed at too high a level, does this mean millions in potential profits from data exploitation (and potentially billions for UK plc) in missed opportunities?

Is putting all your effort into cyber possibly a big mistake?

Yes and no. That's necessary protect our data– these laws are in place because of shockingly bad behavior by some technology providers.

But there is a disturbing confusion about what we are really protecting here. IT has somehow become obsessed with cybersecurity, but doesn't really understand data security yet.

So we spend $180 billion annually on cybersecurity, yet data security strategies are far less well understood and resourced. At the end of the day, all that cybersecurity exists to protect your networks, your infrastructure, and your endpoint… but 99 times out of 100, the bad agents don't care about that: they're after one thing: your data.

So what happens is that CIOs focus all their attention on cybersecurity, GDPR and other data privacy laws, thinking that this will solve the data problem. But if you lock down your data in a way that essentially makes it 'obscure' to the kind of AI analysis you want to do on it, then you're sitting on your oil, not pipelined. The good news is that there is a solution that will satisfy all stakeholders in the retention and use of customer data.

Use the right technology to protect all that sensitive information

The way out of this is to understand that there are tried and trusted ways to get your data scientists and machine learning platforms into the data in a way that 100% retains my NI number from that petrol station visit, but still lets you allows you to do something with the transaction (or sell it to third parties).

Step Forward Privacy-Enhancing Technologies (PETs) such as encryption and anonymization, which can be used to protect sensitive information in ways that shut down anything the CIO might worry about as that “sensitive and secret” personal data is replaced with a value that prevents the CIO from worrying. individual consumer data cannot be directly identified.

What CIOs in this survey tell us is that most organizations are investing heavily in PET via encryption, with pseudonymization and tokenization being less used or understood.

Personally, we think this is a mistake, because pseudonymization in particular is a very efficient way to make your customer and partner data secure in terms of privacy, but open to quick analysis.

Nevertheless, we were very encouraged by the way our analysis showed that we need to rethink data security. Nearly all (96%) of all respondents said they plan to spend part of their IT budget on this topic this year – 49% think this should be between 11 and 15% of their entire IT budget.

In summary, these numbers show that business owners know data is their greatest asset, but they are also crying out for a secure way to use it so they can analyze it all to their advantage in ways that don't expose anyone in the business or their environment. supply chain.

Not long after that famous comparison between data and oil, Australian economist Michael Palmer pointed out that while oil is valuable in its crude state, “if it is unrefined it cannot really be used.” Could thinking more about data than infrastructure security be the refinement step we've been missing?

By Paul Mountford, CEO of Protegrity

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