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Data Classification Overview

An enterprise must grapple with many different kinds of data, including financial reports, personnel files, research results and customer records. The problem is that most companies do not correlate information with their business process, often resulting in a poor utilization of storage resources. As a result, companies often waste valuable storage resources by retaining all data on expensive, high-performance systems. The practice of data classification seeks to overcome this potential weakness by aligning information with business needs, categorizing the data based on these needs and then using the resulting classifications as a roadmap for retaining and storing information. It is the means of categorizing data for its most effective and efficient use. A well-planned data classification system makes essential data easy to find. This can be of particular importance in risk management, legal discovery, and compliance with government regulations.

The benefits of data classification include

The data classification process allows companies to organize their information in a way that corresponds to business needs.
It provides linkage of business processes to business data objects.
It enables information lifecycle management and information asset management.
It provides a clear view of the value of the data and information an organization stores and manages, enabling the IT organization and the business to begin to understand the value of information in a quantitative sense.