The importance of data protection for MSPs
For managed service providers (MSPs), collecting and processing information from and about clients is essential to efficient and effective service delivery. However, storing client data comes with many risks, as credentials, network diagrams, payment information, and other sensitive information can be stolen and used to harm an MSP and/or its clients.
Below, we’ll examine data protection, why MSPs must take it seriously, and what best practices they can implement to deliver on it.
Understanding data protection
Data protection is about ensuring the confidentiality, integrity, and availability of information for an organization. In essence, data protection prevents unauthorized access, ensures accuracy, and enables data (and systems) to be recovered to meet an individual business need.
Reasons data protection is essential for MSPs
With cyber criminals becoming increasingly hyper-focused on the confidential data stored by MSPs, precautions must be taken to ensure that information is both protected and available.
Here are some of the reasons why MSP data protection is especially critical.
Safeguarding client data
Most organizations have some level of sensitive data that typically falls into one of three buckets.
- Data that is known and protected by the organization. (Servers, Workstations, Microsoft 365
- Data that is known and protected by vendors (SaaS, Line-of-Business Applications)
- Data that is unknown (unsanctioned applications, personal emails/computer systems)
Our biggest risk in these three data types is typically unknown data. If the MSP does not assign proper access rights and apply recovery processes to information, it poses an extreme risk to the MSP and the organization. Data Assessments should be conducted regularly to ensure that all business-critical data falls under Data Protection.
Standard Data Protection Policy Points:
- Limiting Access to required users only
- Verifying the integrity of data over time
- Building recovery processes that align with business needs
Failing in any of these categories opens up an MSP, their clients, and potentially their partners to the direct impacts of cybercrime—with the total cost of a data breach incurring about $4.88M in 2024.
Plus, there are indirect expenses to consider, like lost trust leading to lost business.
Regulatory compliance
Another major consideration for data protection is compliance. Even if MSPs are not directly involved in a regulated industry (e.g., finance, healthcare, defense), they may be subject to data regulations if their clients operate in a compliance industry.
For example, the Health Insurance Portability and Accountability Act (HIPAA) applies inside and outside the healthcare industry, including HIPAA-covered entities and their business associates.
There are also government-level laws and statutes to be aware of, domestically and internationally. The EU General Data Protection Regulation (GDPR), for instance, applies to any entity that processes the personal information of EU residents.
Failure to comply with regulations like these can lead to fines, criminal charges, loss of trust, and other consequences. In the most egregious cases, HIPAA penalties can exceed $2M, and GDPR fines average over €2M.
So, MSPs must take the proper precautions to ensure they limit risk for themselves, their clients, and their client’s clients!
Business continuity and disaster recovery
No matter how effective a company’s data security deployment is, accidental deletion, hardware failure, regional disaster, or cyber security breach can put the availability of that data at risk. When this happens, it’s important to have a sound business continuity and disaster recovery (BCDR) strategy in place.
BCDR is a critical component of Data Protection because of the impacts downtime can have on a business. In the worst cases, lost or limited access to systems can cost businesses up to $400K per hour, and that is just on the financial front. Improper BCDR solutions can also leave MSP and SMB clients without key services like healthcare or financial access when systems are unavailable.
To minimize the likelihood and potential impact of such an outage, MSPs should establish a recovery point objective (RPO), recovery time objective (RTO), and maximum tolerable downtime (MTD) per application to ensure the BCDR solution meets business needs. In addition, critical best practices like BCDR testing and immutable storage are necessary to make the BCDR solution as resilient as possible.
Best practices for data protection
One of the most fundamental cybersecurity best practices any MSP can implement is “3-2-1”—having at least three copies of data in at least two systems, one of which is off-site. This ensures basic recoverability and integrity across all data by default.
3-2-1 isn’t just for on-premises data. MSPs should ensure that all business data, even cloud-based data, follows the 3-2-1 rule to increase the potential of recovery if company data were ever manipulated or destroyed.
Beyond the 3-2-1 method, other measures to consider include:
- Implementing access controls: Monitoring and restricting access to storage, backup, authentication, and other critical systems with secure login, session timeout, and other user-level controls
- Encrypting sensitive data: Using strong encryption on data in storage and in transit so that even if it is stolen or compromised, it is unreadable by attackers
- Backing up data regularly: Creating secure data backups to be restored or reverted to in a fashion that meets the MSP or SMB’s needs.
- Training employees rigorously: Ensuring staff awareness of their roles and responsibilities concerning data privacy, including reporting on threats
- Pruning data regularly: Securely deleting, archiving, or otherwise removing data that is not necessary to keep for operations, compliance, or other reasons
Together, practices like these make up a first line of defense against threats to data.
Advanced data protection strategies
Certain threats to data privacy require protections above and beyond basic cyber hygiene. Whether for compliance or general security, many forward-thinking MSPs are implementing sophisticated and complex protections to ensure data is safe at scale.
Artificial intelligence (AI) and machine learning (ML) tools enable swift, accurate, and powerful threat monitoring. Robotic process automation (RPA) like ConnectWise RPA automates general tasks and eliminates the potential for many input or human errors. Powerful AI tools like ConnectWise Sidekick supercharge security by increasing capacity and decreasing response time across multiple software solutions.
Another approach that can limit a bad actor (cyber criminals) access to critical data is to implement Zero Trust Architecture (ZTA), which builds on the “principle of least privilege” and applies it across all systems, denying it by default.
The best way to get the most out of these and other data protection strategies is to work with a trusted partner dedicated to streamlining MSP data protection.
Optimize your data protection today
MSPs are responsible for keeping their own data safe and securing the various kinds of sensitive data their partners trust them with. Data protection is critical to daily operations and maintaining the trust of current and future clients.
ConnectWise is committed to helping MSPs manage data securely and efficiently through smart uses of the best technology available. We recently announced a definitive agreement to acquire Axcient, an award-winning provider of data protection and disaster recovery solutions, with the transaction expected to close in the coming weeks. In addition, we have acquired SkyKick, a pioneer and leader in cloud backup and management software. These acquisitions significantly enhance ConnectWise's cybersecurity and data protection offerings, reinforcing the critical role of data protection as the last line of defense against cyber threats such as ransomware and phishing.
Get in touch today to learn more about how we can help you protect data.