Small Incidents, Big Business Impact: The True Risks of Frequent Data Loss Events

Have you ever wondered how frequently enterprises find themselves needing to restore data lost due to accidental deletions or ransomware attacks? Here’s a hint: it’s far more often than you might imagine.

In fact, recent studies revealed that:

• 39% of IT decision-makers reported their organizations needed to recover data from backups at least once a month. Nearly half (49%) cited cyberattacks as the reason for needing data recovery, while 62% had special requests for deleted or archived data.
• 74% of breaches were caused by human error, such as employees falling prey to social engineering schemes like phishing, misuse of privileges, and stolen credentials.
• 292 days is the average recovery time for businesses affected by breaches involving compromised credentials.

In addition, organizations now handle an average of 200 data restore tickets per month. According to another study, IT teams spend approximately 57 minutes per ticket to resolve issues.

Small-scale data loss incidents never make the headlines, but when you consider the cumulative risks they present, their potential impact can be enormous — even catastrophic for long-term business viability.

This blog looks into the changing landscape of data loss, some real-world examples of such events, and their profound impact on businesses, as well as why now’s a good time to rethink your BCDR plans to prioritize everyday data loss risks.

An Overview of the Evolving Data Loss Landscape

With the increasing threats of data loss, how confident are you in the robustness of your business continuity and disaster recovery (BCDR) strategy to address pervasive challenges?

For example, data loss events attributed to ransomware attacks have become more frequent than many might assume. Recent studies have found that:

• 1,200 ransomware attacks, on average, were reported per day in the first half of 2024 (IDC).
• 70% of organizations experienced at least one breach in 2023 (Forrester).
• 83% of enterprises experienced a breach two or more times in a span of one year (IBM).
• 48% of businesses that suffered cyberattacks lost access to their data (Dell).

While organizations routinely perform data restores, achieving a complete recovery proves far more challenging than many expect. Citing a 2024 study, Disaster Recovery Journal reported that only 42% of organizations manage to fully recover their data after a loss incident. The implications are stark: 58% of businesses permanently lose some portion of their digital assets, even after recovery attempts.

What’s more concerning is that these incomplete recoveries often involve business-critical files, from customer records to financial data, creating ripple effects that impact operations, productivity, and business reputation long after the initial incident.

As for the rarity of large-scale IT infrastructure failures, the Annual Outage Analysis 2024 Report by Uptime revealed a decline in both the frequency and severity of data center outages. Typically, there are 10 to 20 high-profile IT outages annually. In 2023, only 10% of the outages reported by respondents were considered severe or serious. Additionally, 41% of the outages experienced by data center operators over the past three years were deemed negligible.

But here’s the catch.

Traditional BCDR plans often have a narrow focus on complete IT outages, leaving organizations vulnerable to small-scale, everyday data loss events. The frequent occurrence and cumulative risks of the latter strongly suggest the need to shift the focus of your BCDR approach to build cyber resilience.

The Impact of Frequent Data Loss Events: Some Real-World Examples

Small-scale, everyday data loss events pose serious business risks and should be addressed by embracing smart data recovery for enhanced cyber resilience. Here are some risks of frequent data loss, as well as actual cases across different industries that prove how harmful they are.

1. Broad Financial Impact

Smaller organizations that believe they’re too insignificant to be targeted by ransomware are mistaken. In reality, most cyberattacks are aimed at small to mid-sized businesses, according to the National Cyber Security Alliance. Alarmingly, up to 60% of affected businesses shut down within six months following a ransomware attack. However, the financial impact extends to other aspects, such as:

Regulatory Fines and Penalties:

Companies may face substantial fines for non-compliance with data protection regulations following a data breach. This can include penalties under laws like GDPR (General Data Protection Regulation) or HIPAA (Health Insurance Portability and Accountability Act).

Increased Cybersecurity Insurance Premiums:

Following data loss incidents, organizations often see a rise in their cybersecurity insurance premiums, reflecting the increased risk profile.

Loss of Intellectual Property:

Data loss can lead to the exposure or theft of proprietary information, which can have long-term financial implications if competitors gain access to sensitive data.

Costs Related to Legal Action:

Organizations may incur legal fees not only from regulatory investigations but also from lawsuits filed by affected customers or partners.

Long-Term Reputation Damage:

Beyond immediate reputational harm, companies may suffer prolonged financial impact due to loss of customer trust and brand equity.

Lincoln College, a 157-year-old institution based in Illinois, permanently closed after suffering a ransomware attack in June 2024 that severely disrupted its operations and hindered access to institutional data. The college, which had been struggling financially, could not recover from the attack that halted recruitment and retention efforts for three months.

While the demise of a business exemplifies the worst case, other enterprises bear the financial blow by having to pay hefty fines for violations of data privacy and data protection laws.

In June 2024, R.R. Donnelley & Sons Co. (RRD) was fined $2.1 million due to a ransomware attack that exposed sensitive customer and employee data. The U.S. Department of Justice found that RRD had failed to implement adequate cybersecurity measures, which directly contributed to the breach. This case highlights the severe financial and legal consequences of neglecting data security protocols.

2. Operational Disruption

The United Kingdom’s National Health Service (NHS) was hit by a ransomware attack carried out by a Russian-speaking ransomware group, which infiltrated the systems of Synnovis, a key pathology service provider. This supply chain attack resulted in widespread operational disruptions, leading to the cancellation of over 1,600 surgeries and outpatient appointments across major London hospitals, posing risks to patient care. Additionally, nearly 400 GB of sensitive patient data was stolen and published online, raising concerns about privacy and security.

Meanwhile, the City of Columbus in Ohio experienced a cyberattack orchestrated by a notorious overseas ransomware group, which claimed that they had stolen 6.5 TB of city data, including employee passwords and login information. The breach severely disrupted the city’s IT infrastructure, leading to prolonged outages and affecting internet access and various city services.

3. Other Hidden Costs

The hidden costs associated with frequent data loss extend far beyond the immediate expenses of data recovery tools and storage solutions. A staggering 61% of organizations report that increased operational management time and complexity are significant challenges in data protection. This management overhead translates to IT technicians spending valuable hours on tasks such as patching, troubleshooting, and validating backups — time that could otherwise be dedicated to strategic initiatives that drive business value and growth.

Moreover, the complexity of managing numerous systems introduces additional risks, particularly concerning zero-day vulnerabilities. Even with advanced AI tools, detecting vulnerabilities across various components – such as software, agents, and servers – remains a daunting task. The more components you have to patch, the broader the attack surface.

Delays in deploying patches can leave systems exposed to attackers. Recent incidents involving Microsoft and Synology illustrate the vulnerabilities that can happen regularly and almost never be prevented without patching. The more a data protection solution relies on these types of architectures, the riskier your resilience strategy becomes.

Protect Yourself Against Data Loss Risks with AvePoint

Frequent data loss events pose significant risks, but AvePoint’s smart data recovery through AvePoint Cloud Backup can comprehensively reduce these risks. AvePoint Cloud Backup requires minimal management and maintenance, allowing business users to safely and quickly recover their data without needing IT support or lengthy processes. This solution resolves data management issues and frees IT technicians to focus on delivering value to the business. AvePoint enhances productivity and protects your operations by simplifying data recovery and reducing the strain on IT teams.

The next blog in our BCDR series talks about how you can craft modern Microsoft 365 recovery strategies and what best practices you can adopt, so stay tuned!

For now, check out our blog on AI-enhanced cyberattacks and how to combat them: