Data Privacy Management

Privacy concerns have become acute as companies, governments and other organizations collect more customer data. For most companies, data helps them to better understand their customers, so that they can provide customized service and distinguish themselves from competitors. However, some firms have been selling consumer data to third parties, prompting regulators to intervene.

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Customer Experience Tools and Trends

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Recent events, such as government initiatives or the Covid-19 pandemic, have further stirred data security concerns. During this health crisis, governments have taken unprecedented measures, including harnessing data and deploying digital tools such as contact-tracing apps to curb the spread of the coronavirus. Once implemented, government measures often remain in place long after a crisis abates.

Data privacy poses legal and reputational risks to companies, not to mention the risks that consumers face. Privacy management tools, which range from software to broader solutions, can help companies build comprehensive data privacy programs that span multiple channels and touchpoints. The tools evaluate how well companies adhere to local and global privacy laws and to industry best practices. They also assure executives and customers that rigorous standards will protect consumer data, mitigating risks.

Customer Experience Tools and Trends: Data privacy management


How companies use data privacy management tools

  • Assessment of data collection and usage practices. Companies can evaluate data-collection procedures and forms, comparing them with best practices. Under certain regulations, companies must guarantee that data will be deleted if requested by a customer.
  • Building consumer confidence. Raising awareness with customers about how a company adheres to privacy best practices builds trust that the company takes privacy seriously.
  • Analysis of privacy policies. Tools help ensure that privacy policies make sense across multiple dimensions, including product lines and regions.
  • Alignment of policy with data needs. Keeping policies up to date ensures that they reflect the evolving data landscape.
  • Management of disputes and breaches. Privacy tools track breaches and customer incidents, ensuring documentation through the right channels and reports to the right owners or authorities.

Key considerations

  • Balance risk and value. Weigh security risks against the potential value of the data or initiative, considering the acceptable level of risk for each use case.
  • Embed security at the core. Security is a binary issue—the data is either secure or not. Companies must design security, including cybersecurity, into systems and tools from the start. All types of data risk are manageable, and should not pose a barrier to implementing data-driven products and services.
  • Develop consumer trust. Leading companies provide a simple privacy promise to consumers, eliminate surprises, ask permission and give users sensible choices. Many leading companies use data privacy as a unique selling proposition and allow self-administration of data by customers.
  • Set consumer expectations. Meeting legal requirements may not be sufficient. Consumer outcry often precedes legal changes. Executives should ask, “Would I be worried if this appeared on the front page of a newspaper?” They should operate with transparency for customers and privacy enforcement authorities, and consult with customers while implementing measures affecting privacy.
  • Coordinate privacy policies. A privacy policy’s scope depends on the company’s overarching data strategy. Policies should be coordinated across products, business units and operating geographies, with the level of centralization reflecting the company’s strategy.
  • Build the capabilities. Companies might need to hire people with specialized expertise or adopt additional tools to embed privacy considerations into everyday operations.
  • Set up privacy programs. Leading companies often appoint an ombudsman to monitor privacy ethics and standards. Some also name a chief data officer as well as a governance board of credible outsiders charged with protecting users. Many hire an independent organization to conduct regular privacy audits.