August 22, 2023
 min read

Sensitive Data Classification

Learn how to classify sensitive data across all SaaS and Cloud Apps

TL;DR: A Comprehensive Guide to Sensitive Data Classification

  • Data classification is crucial for protecting sensitive information in the digital age.
  • It helps with risk management, compliance, operational efficiency, and data lifecycle management.
  • Common types of sensitive data include PII, PHI, financial information, intellectual property, and business-specific data.
  • A standard classification framework includes public, internal, confidential, and restricted/secret categories.
  • Best practices for data classification include starting with a data inventory, establishing a classification policy, automating where possible, conducting regular audits and training, and tagging and labeling data.
  • Learn how Strac automatically classifies sensitive data across all SaaS and Cloud apps in minutes

In the digital information age, one of the prime responsibilities of IT and security leaders is to ensure the safekeeping of sensitive data. A critical step in this process is understanding and categorizing this data. Enter the world of sensitive data classification. This article will highlight the concept's importance, examples, and the broader perspective for IT and security leaders.

The Importance of Data Classification

With the surge in data breaches and cyber threats, protecting sensitive information is paramount. Classification helps understand what to protect and provides insights into the level of protection required.

  1. Risk Management: By classifying data, organizations can assess the potential risk associated with its loss.
  2. Compliance: Many regulations demand businesses to protect certain types of data.
  3. Operational Efficiency: Knowing what data is crucial ensures resources are efficiently allocated for its protection.
  4. Data Lifecycle Management: Classification aids in the management, storage, and eventual disposal of data.

How to Identify Different Types of Sensitive Data

  1. Personal Identifiable Information (PII): Data that can identify an individual. E.g., Name, Address, Social Security Number.
  2. Protected Health Information (PHI): Health-related information that can link back to an individual.
Table of PHI data elements (also listed below in article)
HIPAA Data Elements supported by Strac
  1. Financial Information: Credit card numbers, bank details, and other financial data.
  2. Intellectual Property: Trade secrets, patents, copyrights, and proprietary business information.
  3. Business-specific sensitive data: Information specific to a business that might not be critical to others.

For a full catalog of sensitive data elements, please see here:

A Framework for Effectively Classifying Sensitive Data

A standard classification structure typically encompasses the following:

  1. Public: Information that can be disclosed to the general public without any ramifications.
  2. Internal: Data meant for internal use. Its exposure may have limited risk.
  3. Confidential: Information that, if disclosed, could lead to business harm or regulatory penalties.
  4. Restricted/Secret: Data that requires the highest protection. Exposure can lead to severe consequences.
Sensitive Data Classification Framework

Essential Best Practices to Follow When Classifying Sensitive Data

  1. Start with a Data Inventory: Understand where your data resides before starting the classification.
  2. Establish a Classification Policy: Define criteria and a framework.
  3. Automate Where Possible: Use data loss prevention (DLP) tools and other technologies to automate the classification. For example Strac is a SaaS and a Cloud DLP that automatically discovers sensitive data and, based on remediation policy, it will redact or mask sensitive data.
Strac Zendesk Redaction
  1. Regular Audits & Training: Periodically review the classifications and train employees.
  2. Tag and Label: Make sure that every piece of data has a clear, visible classification label.

Real-Life Examples Demonstrating the Implementation of Data Classification

  1. Healthcare: Hospitals might classify patient medical records as 'Restricted' due to its PHI content, whereas a newsletter sent to patients might be 'Public'.
  2. Finance: Transaction histories might be 'Confidential' but quarterly public earnings reports would be 'Public'.
  3. Education: Students' personal grades might be 'Restricted', but a school calendar would be 'Public'.

Strac: A Powerful Solution for SaaS and Cloud Data Classification and DLP

Strac: SaaS and Cloud DLP

Strac automatically discovers sensitive data, classifies according to its sensitivity, and depending on remediation policy, it will automatically redact or block it.

Closing Thoughts on the Significance of Sensitive Data Classification for IT & Security Leaders

Sensitive data classification is no longer optional. As stewards of an organization's data, IT and security leaders must champion and instill the discipline of classification, making it a standard business practice. Through regular audits, training, and the effective use of technology, businesses can fortify their data protection mechanisms, ensuring they remain competitive and compliant.

Founder, Strac. ex-Amazon Payments Infrastructure (Widget, API, Security) Builder for 11 years.

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