Companies Poised To Repeat Data Privacy Compliance Mistakes

U.S. companies haven't learned much from the missteps they made while preparing for the European Union's General Data Protection Regulation (GDPR), suggests a new study on data privacy regulation compliance.

San Mateo, CA-based data privacy management software company DataGrail surveyed 301 U.S.-based privacy professionals in information technology, operations, legal, and risk and compliance in April for its report, “The Age of Privacy: The Cost of Continuous Compliance.”

About half of the survey respondents whose companies are affected by GDPR revealed they had failed to meet last May's deadline to comply with the regulations — and 70% said the data privacy compliance systems they established or plan to have in place are incapable of adapting to new regulations.

“The interesting thing here was that, in preparing to become GDPR ready, a lot of the companies tried to build something in-house to try to scramble, if you will, to become GDPR ready,” said Daniel Barber, co-founder and CEO of DataGrail.

While most respondents reported it took them at least seven months to prepare for GDPR, 71% believed they could be ready for the California Consumer Privacy Act (CCPA) compliance deadline in less than six months. The CCPA deadline is Jan. 1, 2020.

The majority of companies are still approaching privacy regulations on a case-by-case basis, and half are using manual processes to manage GDPR privacy rights requests, which often involves a couple dozen employees and “thousands of touch points with the potential to introduce human error,” the report states.

Barber said the study's findings show that “most companies still rely on piecemeal technology solutions and manual processes, when they should be turning to privacy management solutions purpose-built for privacy regulations.”

He added: “Companies will need to integrate and operationalize their privacy management to avoid the time-consuming and error-prone manual processes to comply with these regulations.”

According to the report, most companies said the murkiness and complexities of GDPR make compliance a challenge.

Other major hurdles included lacking the time and human resources to plan and implement compliance programs and struggling to integrate compliance solutions across multiple systems and services.

The top challenges for CCPA compliance were virtually the same as those listed for GDPR.

Other findings from the report include:

• The average company held between 2,000 and 4,000 hours of meetings preparing for GDPR, while some spent more than 9,000 hours, or more than a year, in meetings.
• Nearly 80% of companies reported shelling out at least $100,000 on GDPR and CCPA compliance, while 20% have spent more than $1 million.
• Nearly 60% of companies have at least 26 employees managing data subject access requests under GDPR, and 84% have a system in place to help prevent human errors that could arise during the process.

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Phillip Bantz is a reporter for Corporate Counsel, an ALM sibling of Cybersecurity Law & Strategy. Follow him on Twitter @PhillipBantz.