As SaaS organizations that use cloud-based solutions and remote technologies become more common, we are starting to see regulations and auditors get stricter about IT governance standards. As standards become more stringent, regulated SaaS companies become more aware of the difficult requirements set upon them and, in turn, ask providers to help with IT audits.
This means the pressure is transferred away from SaaS providers, who do not generally perform audits or mind regulatory requirements outside of their own responsibilities. With the evolving compliance landscape, organizations must find a trusted partner that can provide expertise in risk management, information security, audit preparedness and audit support.
What exactly is changing in the SaaS legal landscape and what do you need to know about it? This article will dive deep into just that.
#1 Compliance as a Service and Audit Support
Security and data governance audits are not an optional state of checks and balances and are a serious legal and regulatory requirement today. Therefore, the burden has shifted to compliance as a service providers to help deal with and prepare for some of these experiences.
More often than not, regulated SaaS businesses require records on IT security audits, clear-cut data storage, handling and protection policies, performance standards and even risk management or disaster recovery plans. In other words, you may be initially audited by customers before any legal or third-party audits take place.
Audit preparedness is more than just proper planning. It requires continuous education about the latest compliance and regulatory standards as they relate to data privacy and security. Most organizations do not have a dedicated staff member for this, so finding a trusted compliance as a service provider is a must.
These providers not only provide compliant cloud and colocation services, but the support and guidance to get you to peak protection. While providers like Amazon Web Services (AWS) are a popular cloud choice, they are not an IT partner. Working with providers like LightEdge, allows you to gain access to our CSO and go line by line through any audit report. This is a completely different level of support, that organizations would not receive from big players like AWS, Azure and Google.
What is Compliance as a Service?
Compliance as a Service means that the IT service provider’s people, processes, technologies and facilities are audited annually by a third-party firm. Providers must be audited to the same standards that regulated entities are.
While these organizations are not regulated SaaS providers themselves, they provide bedrock capabilities that are the basis for compliant IT environments. These include hardened facilities that have impenetrable physical security, uninterruptable power and redundant connectivity that will meet the mandated needs of financial institutions.
An example of these capabilities includes zoned areas with multiple factors of authentication and audit logs to verify only authorized personnel were in sensitive areas (near IT systems or critical infrastructure). Another is the redundant power with UPS and generator backups that is required to sustain IT operations through any disasters or emergencies.
Similarly, redundant network connectivity is needed to keep cloud services flowing seamlessly, even when there are link failures or carrier outages. Our economy, as well as the safety of our residents, depend on reliable and timely access to financial services.
For this reason, colocation providers and their data centers that deliver true Compliance as a Service certifications are often added as critical infrastructure sites for first responders (similar to hospitals or power facilities). These sites are addressed first in emergencies and are at the top of the list for refueling onsite generators or security services to protect during emergencies and natural disasters.
Compliance as a Service capabilities can also extend into secure networks, firewalls, compute and storage systems. Even IT functions such as data backups, replication and recovery in alternate facilities, or vulnerability management of OS and applications.
#2 Balancing Employee Empowerment and Security Control
Balancing security while giving employees freedom is tricky. Survey respondents said balancing control and empowerment is an area of high priority where significant improvement is required. In fact, 94 percent of IT practitioners say it is their top concern. On the operations front, 83 percent of professionals agree reports Blissfully’s 2019 SaaS Trends Report.
On a similar note, 53 percent of respondents say balancing security with employee privacy is a high-priority issue and needs improvement. Laws like GDPR make it more important than ever to consider how to achieve security without sacrificing either employee or user privacy at the same time.
Unfortunately, human error is a top reason for data breaches or data loss. Thankfully, there is security awareness training available to reduce this risk and get your staff operating efficiently.
There are two levels of training that any good plan should encompass. The first is general training which is aimed at all employees or business associates with system access. General training should include basics like how to identify and avoid phishing attempts and forms of social engineering, what to do when the employees think they may have been targeted and what the impact of a data breach will be.
The second level of training is group-specific training which targets specific areas of responsibility. You must implement this higher-level training. IT administrators have different concerns than developers, but they are closer to each other than your average user with ID and password who only can access or change data.
#3 Always on Secure Cloud Technology
Finding the right cloud provider to host your SaaS organization is a critical piece in the compliance puzzle. When it comes to selecting a cloud provider, the requirements you have and the evaluation criteria you use will be unique to your organization. However, there are some common areas of focus during a service provider assessment, especially for SaaS providers. Areas to consider when vetting a cloud service provider includes:
- Compliance certifications and standards
- Reliability and redundancy
- Cloud migration and compliance support
- Company profile and business health
Some common certifications that your cloud service provider should be compliant with include:
The American Institute of CPAs Service Organization Control reporting platform’s goal is to assure that systems are configured for maximum security and privacy of customer data. SOC reports are specifically designed for service providers storing customer data in the cloud, meaning that it applies to nearly every SaaS company. It is one of the most common compliance frameworks and, thus, is often the first that SaaS companies choose to comply with.
Other additional compliance certifications that providers may have include HIPAA, HITRUST and PCI DSS 3.2. In addition to meeting compliance certifications, it is important to find a cloud provider that is reliable and redundant so your applications never go down.
A big part of always on applications is the network aspect of a cloud provider. All of LightEdge’s facilities and services have been designed around connectivity with proven insight from our networking experts, making us unmatched in the market.
Your cloud service provider should also have cloud migration and compliance support. In addition, vetting the longevity and health of a company is important to ensure they are capable of supporting your organization long-term.
#4 Minimizing the Risk of a Breach
While most businesses know that security to reduce the risk of a data breach is important, many still do not have the proper controls in place. Specifically, organizations that fail to prioritize security and protect consumer data are taking significant losses both in value and in consumer confidence.
Since SaaS is centered around data sharing and mobility, data security is imperative. Attack tools and strategies today are more sophisticated than ever, making it easier to access your data. Cybersecurity incidents are commonplace, and any number of parties can initiate them such as cybercriminals, hackers or malicious employees.
These security incidents can result from hacktivism, improper infrastructure, human error, or lack of proper training. According to a Ponemon Institute study, over half of all data breaches are the result of malicious intent or cybercrime.
As the IBM 14th Annual Cost of Data Breach Study notes, “the loss of customer trust had a serious financial consequences for the companies studies, and lost business was the largest of four major cost categories that contributed to the total cost of a data breach. The average cost of lost business for organizations in the 2019 study was $1.42 million, which represents 36 percent of total average cost of $3.92 million.”
Another major finding from the Ponemon Institute was that data breach costs impacted organizations for years. About one-third of data breach costs occurred more than one year after a data breach incident in the 86 companies they were able to study over multiple years.
While an average of 67 percent of breach costs came in the first year, 22 percent occurred in the second year after a breach, and 11 percent of costs occurred more than two years after a breach. Putting security controls in place to reduce the risk of a data breach is especially important for regulated SaaS providers.
#5 Identity and Access Management
Identity management is the act of confirming that each user is the person he or she claims to be. Access management determines if a user does or does not have legitimate rights to retrieve data or use an application. As important as both identity and access management are on company premises, they are even more important for cloud-based applications.
According to McKinsey, Security executives emphasized that two identity management capabilities are especially important to them. First, they want tight and easily implementable integration between SaaS applications and widely adopted enterprise identity management tools.
Second, they need sophisticated and role-based access management. This includes the ability to provide selected people with the authority to access certain data or undertake certain transactions within an application.
Be Ready to Evolve Alongside the SaaS Compliance Landscape
With the new regulations empowering users to protect their data, it is finally time for better compliance and security. Let LightEdge help you safely and securely store your data. Whether you are looking for a top-tier colocation service provider or a world-class hosting and cloud provider, LightEdge has got you covered. Now that modern IT practices have started to blend physical with virtual and cloud with on-premises, safeguarding your applications and data requires several tools and methods.
LightEdge is committed to keeping our customers’ IT operations, critical applications and data protected. We provide the technology and resources our customers require to get back to a production state that meets their RTO and RPO requirements.
Our highly trained compliance and security experts take the guesswork out of keeping your business protected. Trust our expertise to ensure you are covered through our security and compliance services which include risk management, information security, audit preparedness and support.
The reliable availability of business IT is essential to the management and livelihood of every company, large or small. All elements hinge on the dependability of your technology to deliver vital information right when you need it.
Our LightEdge facilities are more advanced than traditional data centers. We have created true Hybrid Solution Centers designed to offer a complete portfolio of high speed, secure, redundant, local cloud services and managed gateways to public clouds through our hardened facilities.
Want to learn more about LightEdge’s disaster recovery and business continuity services? Contact one of our SaaS compliance experts to get started or to schedule your private tour of any of our data center facilities. We have disaster recovery, colocation, and business continuity experts standing by to answer any of your questions.
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