What is Data Classification?

Data is the foundation of many organizations today. It is transferred between in-house departments and shared with third parties to enhance customer experience, influence industry trends, and facilitate day-to-day function (grocery stores, banks, and gyms all process consumer data). 

As mentioned in our recent blog, “What is Data Classification? A Definition & Overview,” data classification is the process of categorizing data into relevant subgroups so that it is easier to find, retrieve, and use. Companies use data classification tools to mark or tag data with a classification label such as “Confidential” or “Public” and simultaneously clean their company’s storage of redundant, trivial and obsolete data (ROT) that has been hidden and unkempt.

It is necessary to classify data regardless of whether your goals are driven by privacy regulations covering sensitive data or by security that’s focused on any type of data within your company. Privacy driven initiatives are typically driven by compliance with regulations such as the GDPR, CCPA / CPRA and HIPAA

Regardless of whether your classification needs are driven by privacy or security, the act of classifying data can yield other benefits. For example, a typical organization stores substantially large volumes of old data that is no longer used, or needed. A proactive classification initiative helps to uncover such data leading to a simple decision – deletion which means less data and lower risk. 

How Do Data Classification Tools Work? 3 Solutions to Consider

There are three different ways to classify data: manual, automated and hybrid.

  1. Manual – As the traditional method for classifying data, a manual approach requires human intervention. Keep in mind, this means it is subject to human judgment and possible error. However, manual classification also allows files to be viewed and organized using historical knowledge of the reviewer who is often the data creator. 
  2. Automated – Automated classification is an efficient, technology-driven solution that reduces the degree of human intervention and errors. Automated classification requires specialized capability within your chosen data discovery and data classification product. 
  3. Hybrid – This form involves a combination of using data classification tools and human intervention for data classification. This is where many organizations end up on their data classification journey.

What are the Benefits of a Data Classification Tool?

A data classification tool can be the catalyst to discovering and tagging unknown and hidden data, as it provides complete transparency of where your company’s various types of sensitive, confidential and publicly distributable data resides. 

With 128 countries now having privacy laws and data protection legislation, knowing exactly what employees, departments and applications are creating, storing and processing files will enable stronger preparation to comply with current and future requirements as they pertain to data. For example, a health insurer may find that employees working remotely are saving files to their desktop instead of a centralized encryption solution, which could lead to a HIPAA violation. But with detection through discovery and classification, followed by appropriate remediation actions, this would be avoidable. Understanding the whereabouts of your data also protects against the possibility of a breach because your business is able to proactively safeguard vulnerable entry points.

Furthermore, a data classification tool boosts operational efficiency and supports achieving business goals. The time employees are allocating to disparate data management practices can be reinvested into other business priorities. By establishing a consistent model to label the sensitivity of all data, companies can better budget and plan the appropriate level of storage security and encryption solutions required. 

And finally, properly classifying and safeguarding data simply means meeting the trust of your customers and thus, reducing the likelihood of a data breach that can result in penalties as a result of violating state, national or global compliance rules. 

What Should You Ask Yourself When Choosing Data Classification Software?

Classification software is not a one-size-fits-all solution. Decision-makers at your organization must be prepared to analyze whether or not data classification software is compatible with the company’s goals and existing data.

A simple starting point to consider is:

  • Are your needs driven more by privacy and regulation of personal data or security of all data, including company confidential data?
  • How many types of different storage platforms and cloud providers do your organizations store data within and how much data exists?
  • Are you concerned about particular data sources, or any data source? Considerations include:
    • On premise desktops, servers, databases, email and big data clusters
    • External cloud storage including databases, emails, buckets and user cloud folders
  • Do you have executive support from your CISO, chief privacy officer, chief data officer or similar senior role to implement a company-wide policy and process to make classification of data a standardized BAU practice?

And lastly, is the software open enough to allow other platforms and processes to integrate? Data classification tools should only make the process more efficient and thorough and a key way to do this is through a long-term strategy that commits to deep integration that automates and streamlines all data-driven processes. If data classification can be automatically initiated from your other data platforms based on certain triggers, or at least completed with minimum human interaction, while also revealing security and compliance holes, your company will see a far greater return on investment as opposed to an entirely manual model. 

Use Ground Labs’ Data Classification Tool 

Data classification and discovery tools reveal weak points that businesses must remediate to stay competitive and compliant in this data-saturated marketplace. Ground Labs offers Enterprise Recon PRO, a globally recognized solution for data discovery with data classification and metadata tagging capabilities. It is able to detect over 300 data types and is also agile, which is key to the ever-changing compliance and cybersecurity landscape. 

If you are ready to find, classify and harness the power of your company’s data, schedule a discovery call with one of Ground Labs’ experts today.

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