Why is Data Classification Important?



Data classification is important because it allows a company to measure their data, and then protect it based on its importance. For example, the mission statement of a company may be seen as something largely public, while their trade secrets and licensing deals may need to be protected in order for the company to remain efficient and competitive. We at PlexTrac recommend you classify all of your information into a tier and take action accordingly to protect what is important to you as an organization.




Your data and information are the most important part of your company. This data is the heart of your organization’s identity. This data is often the source of your competitive advantage. If this classified information were to leak it would spell trouble for the success of your enterprise. There are 3 distinct tiers for the categorization the information inside your business; public, private, and classified. Today on PlexTrac.com we are going to be going over each of these information tiers. This includes examples of each, and an explanation on why it is important to classify your information by importance in the workplace.



Data Classification Tier I – Public Data

Not all data is vital to your company’s survival. Public data is defined as “data that has no or negligible harm in relation to an organization regarding its public disclosure”. Data under this tier of information is relatively harmless for outsiders to know. The public knowledge will not result in any meaningful loss to your company’s advantage or internal affairs. This type of data does not need to be protected, secured, or transported in any specific way. Public data has no special procedures in place to make sure it is protected because it simply does not need to be secured from anyone’s viewing.



Examples of public data include press releases, public research, course or company information, foundational stories or news sections, or any other data a company is open with. You will often find a large slew of public data on a company’s website. This data is often publicly obtainable for the use of a business in promoting, marketing, and informing consumers to the activities, values, and principles of a business. The strategic use of public data can greatly benefit an organization. It is crucial for a business to categorize public data with only positive, obvious, and unimportant data regarding your business.



Data Classification Tier II – Private Data

Data can be used as an internal tool for success, but it also can benefit outsiders. Private data is defined as “data for internal use only, and disclosure may have a significantly negative impact on the organization”. Private data is data used for strategic marketing and involves personally identifiable information (PII) and offers insight into the company and its individuals involving private details. All institutional data should be regarded as at least private in nature. This data requires a lot more care and secrecy than public data. All information marked as private requires specific saving and involves secure transmission and storage.



Examples of private data include demographics of your workforce, financial reports, secure research data, and information about your budget. The common thread about all of this information is that it can be taken and used against you as a business. Competitors and other businesses entirely see this information as valuable and can help them in the benefit of their venture or the detriment of yours. This is why it is important to secure this information and use security systems that protect this data from falling into the wrong hands.



Data Classification Tier III – Confidential Data

The highest tier of data is on a “need-to-know” basis. Confidential data is defined as “data that is extremely sensitive in nature and should only be accessed by a small group of individuals with a legitimate need-to-know”. The disclosure of this data may entail grave consequences for the organization. This is data that only the absolutely most vital members of an organization or project must know. This also means that these individuals need to know this information, as only extremely relevant parties will be keyed in on this information.



Examples of confidential data include trade secrets, data protected by law or confidentiality agreements, extremely personal information, and much more. The leak of this data will result in dire consequences for the individuals or businesses that this information applies to. Leaks of this information might also involve legal trouble, or other serious ramifications stemming from the company or government at large. Overall, it is key to keep this information between those involved only. This is why confidential data is so limited in the number of people in the know, even within the confounds of a company.

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