Data Residency: Meeting the Demands of Today’s Global Landscape


Selecting a cloud provider that offers data residency has become essential to manage today’s global data environment.

It’s no secret that data holds substantial value. Organizations across the globe are leveraging data every second to make better, more informed business decisions. Increasingly, data residency must be taken into account.

Why? More data exists today than ever before. Since that data is increasingly distributed, in part due to digital transformation and hybrid working environments, it has become increasingly difficult to manage and leverage that data in an efficient way. Data volumes are only expected to increase from here, with data creation projected to grow to more than 180 zettabytes by 2025. Ideally, if organizations can leverage this data, it can lead to new insights and opportunities.

Unfortunately, this high volume of data can also lead to disorganization and have the potential to negatively impact team collaboration – making it important for organizations to find solutions that help manage their data and support more efficient workflow.

Additionally, as more data is collected and consumers become more concerned about the impacts of sharing their data, new and more stringent data privacy laws and regulations have emerged. So, while organizations attempt to manage these large amounts of data and glean actionable insights, they must also comply with data privacy laws that govern how data is collected, stored, and moved across the globe.

Because of this, data residency has become much more critical, and something organizations need to consider. Data residency can help bring your data closer to the teams and processes that need the data, which can help to reduce latency and improve performance for both employees and customers. This is extremely important as technology budgets continue to strain due to economic inflationary pressures.

Choosing a cloud provider is an important decision that can facilitate the aforementioned benefits, enable teams to access data across silos, and also manage cyber and regulatory risks. There are many factors for organizations to consider when selecting a cloud provider, including certifications, the service roadmap, data security, reliability, and performance, among other areas. However, data residency, which refers to the physical location of your data, has earned a spot toward the top of that list. Choosing a cloud provider with good data residency can help, and below are a few key considerations. 

See also: 7 Countries Creating Cross-Border Privacy Standards

Regulatory Requirements

In today’s globally distributed reality, data residency has become a strong differentiator. In some regulated industries, such as finance, healthcare, and government, data residency requirements are not optional. It’s vital to understand your requirements and ensure your provider satisfies them.

Regulatory requirements do not only affect regulated industries, however. All organizations operating in the cloud must adhere to some requirements – and that list is growing.

With the increasing number of national and regional privacy laws, tracking data residency is the key to maintaining compliance with both data sovereignty and privacy laws. This should be a top priority for organizations in 2023 if it isn’t already. Although there are many other challenges to tackle due to the complexity of the data landscape today, as the last three years have taught us since the start of the global pandemic, agility is not only ideal but critical to survival.

Locations Supported

Equally important to offering data residency, in general, is its support for multiple locations. The importance of agility translates across the business, whether it’s related to selecting technologies or learning how to work and grow in a hybrid working environment. By offering data residency in multiple locations, cloud providers can give organizations some of that necessary flexibility. Providing customers with the choice of where their data is stored should become table stakes and not only be made available by the largest SaaS companies but by all companies.

Companies collect data from all over the world at a fast rate, and organizations choose to store their data in multiple locations. This is illustrated by the number of data centers that exist in different countries, with the United States having over 2,000 data centers and the United Kingdom, Germany, and China all having over 400. As a result, it is crucial that cloud providers offer data residency for a dozen geo locations, not just two or three.

The cloud providers that offer data residency across many geographies will be the ones that are poised to see more growth and adoption in the coming years. Purchasing a subscription from a provider who doesn’t offer data residency can be compared to walking into a grocery store to find out they don’t have a produce section –– it doesn’t live up to today’s requirements or standards.

Data can be collected and stored in many different locations, and that means it might be impacted by varying laws and regulations. For example, some regions have introduced bans on transfers related to data. Choosing a cloud provider that offers data residency in multiple locations will help organizations avoid obstacles imposed by these bans and will enable them to easily move their data and to feel confident that they are following local laws and regulations.

The need to balance the complexity of the distributed data landscape with increasing data privacy regulations is a challenging reality for today’s organizations. Now that more data exists than ever before, selecting a cloud provider that supports data residency has become essential. With data residency, cloud providers can offer much-needed agility — empowering your organization to leverage new insights and make better business decisions faster.

Andy Boyd

About Andy Boyd

Andy Boyd is Chief Product Officer at Appfire, an enterprise collaboration software company that enables teams to plan and deliver their best work. Andy leads the product management and growth disciplines for Appfire’s popular solutions, which help teams with Workflow & Automation, Product Portfolio Management, IT Service Management, Document Management, Business Intelligence and Reporting, Administrative Tools, Agile Tools, Developer Tools, Time Tracking, Publishing, and Visual Collaboration. Prior to joining Appfire, Andy served in product management roles at IBM, where he was also part of the founding team that brought the IBM Watson (AI) platform to market.

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