What American Manufacturers Need to Know about New Data Protection Laws in Europe

As governments everywhere seek to shore up cybersecurity initiatives within their countries, broad new data protection regulations are coming to the fore in Europe. Called the General Data Protection Regulation (GDPR) is a new regulation in the European Union that addresses the capture, control and consent of personal information. For global manufacturers based in the U.S., these new rules could have wide impact. It will require manufacturers doing business in the EU to have strict data privacy and protection measures in place by May 2018.

Olivier Van Hoof, manager at the data management firm of Collibra, spoke with Chief Executive. He said American manufacturers need to start planning now.

Q: What is the GDPR regulation and how could it impact American firms doing business in Europe?
A: Today’s global economy is creating so much data so quickly it has become nearly impossible to control. The General Data Protection Regulation (GDPR) is a broad regulation in the E.U. that addresses the capture, control and consent to use personal information. It’s a way to protect the rights of citizens and applies to any company inside or outside the European Union that offers goods and services to European citizens. Don’t be fooled by thinking the GDPR applies only to European companies. If your organization conducts business in the EU, and collects personal data, this regulation applies.

Q: How could the GDPR regulation impact American manufacturers?
A: Well, what’s significant about the GDPR regulation is its scope. It is broader and stricter in regard to data privacy and protection than most U.S. regulations and puts greater emphasis on the data rights of individuals. GDPR broadens the definition of “personal information.” This has particular relevance for the manufacturing industry, which is using AI and RFID to collect, use and integrate personal information into product manufacturing. Through IoT and their quest to make better connections with end users, manufacturers are collecting more information about consumers. And we’ve seen a number of studies indicating the manufacturing industry lags behind in cybersecurity. Therefore, specific safeguards should be established for these newer forms of electronic communications and sharing of personal data. And it shouldn’t be taken lightly. Regulators will issue significant fines for GDPR non-compliance, up to 2-4% of global revenue for non-compliance. The deadline for compliance is May 25, 2018.

“Data protection must become a board-level discussion.”

Q: So what steps should manufacturers take to prepare for these regulations?
A: Protecting and securing data starts with establishing the right controls around your data, and making data transparent, where necessary, across the organization. Complying with the GDPR requires a new approach and new tools for data protection and privacy. Data protection must become a board-level discussion. Data governance can provide the answers an organization needs to begin addressing the complex issues surrounding GDPR compliance. It can provide a framework for managing and defining enterprise-wide policies, business rules, and data assets to provide the necessary level of data protection and quality.

Q: Is it fair to say this will become an even bigger issue for manufacturers in the coming years?
A: Absolutely. As the value of data increases, so does the interest of the hackers. The increasingly large volumes of data generated and collected create a compelling need to manage, govern and secure the data. It is very typical to use data lakes to host all the data volumes, however there is often little or no focus on the governance and the lakes quickly turn into swamps with no control or ownership of the data. Governance is an essential part of data security because you cannot protect what you do not know.

Q: As many manufacturers are only scratching the surface of IoT use, how should they ensure they’re protecting data from the start?
A: Starting a data governance program and making it business as usual is essential to ensuring the integrity of your data. Focus on the items that are key, yet straightforward to implement. This includes business glossaries with definitions to define your data, creating data models and establishing ownership of data models and business teams. Ensure that as an organization, you understand and have transparency of your data and all processes that use it. As a parallel step, it is key to train your employees on data security. Breaches more often than not start from the inside. With sufficient training and understanding of data security your employees will be better equipped to handle social engineering intrusion attempts, such as phishing.

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Craig Guillot
Craig Guillot is a business writer based in New Orleans, La. His work has appeared in Wall Street Journal, Entrepreneur, CNNMoney.com and CNBC.com. You can read more about his work at www.craigdguillot.com.

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