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1 WHITE PAPER The IT Manager's Role in Proactive Information Retention and Disposition Management: Balancing ediscovery and Compliance Obligations with IT Operational and Budget Constraints Sponsored by: Iron Mountain Vivian Tero March 2010 Laura DuBois Global Headquarters: 5 Speen Street Framingham, MA USA P F IDC OPINION In today's digital world, where data grows at a compound annual growth rate (CAGR) of 60%, data storage and information management costs need to keep up. As data volume and storage infrastructure grow, corporate IT organizations are tasked with meeting their operational service levels and cost containment objectives while also supporting corporate data retention, privacy, and ediscovery obligations. Close cooperation between legal and IT is crucial to achieving these business, legal, and IT operational objectives. Legal plays a key role in translating legal and regulatory mandates into policies and processes for retention, disposition, legal holds, and privacy. IT translates these policies into technical protocols and controls, taking into account the corporation's IT operational constraints and capability maturity. Legal also helps determine the business and legal risks associated with specific content types and information repositories so that IT knows how to prioritize its risk remediation and mitigation efforts. Collaboration across legal and IT can enable the corporation to leverage existing technology and processes to meet business, IT, and legal obligations. Increasingly, firms are exploiting their technology investments in data protection and recovery to meet ediscovery obligations for data on endpoints (PCs, laptops, and mobile devices). IN THIS WHITE PAPER This IDC White Paper discusses the practical approaches the IT organization must consider so that it can effectively execute on the corporation's compliance and ediscovery objectives while still meeting the IT organization's budget, application performance, and service-level objectives. SITUATION OVERVIEW In today's digital world, where data is growing at aggressive rates, the costs and risks associated with data storage continue to grow. IDC's 2009 Digital Universe research concludes that the digital universe will grow at a CAGR of 60% from 2008 to During this period, IT budgets are forecast to grow at a CAGR of approximately 12%. (For more details, see IDC's 2009 Digital Universe study.)

2 Companies are finding that they are adding new hardware at a high rate in order to accommodate the growing data stores of their businesses. IDC research forecasts that disk storage capacity will grow from 8,532PB in 2008 to 54,480PB by 2013, a CAGR of 45%. (For more details, see Worldwide Enterprise Storage Systems Forecast: Economic Crisis Driving Quest for Storage Efficiency and Emerging Architectures, IDC #218252, May 2009.) This increase in storage capacity puts additional pressure on IT management and maintenance costs in addition to capital budget constraints. In concert with infrastructure cost and growth, IT organizations are increasingly being asked to take on the management of information on behalf of different departments and stakeholders, including compliance and records management, legal, audit, privacy, and line-of-business organizations. IDC research concludes that organizations are expecting an increase in the volume of litigation events, as well as an increase in the average electronically stored information (ESI) collection volumes per matter. These organizations are also anticipating planned ediscovery budgets to remain flat or decline in the medium term. (For more details, see Proactive Information Retention and Disposition Management: When Faced with Litigation Events, Readiness Is Your Best Defense, IDC White Paper #222554, March 2010.) IT's Delicate Balancing Act: Managing ediscovery, Data Retention, and Privacy Obligations for Distributed Data While Meeting Operational Service Levels and IT Constraints As consolidation in the average number of enterprise datacenters continues, the number of regional, branch, and home office locations continues to expand. This expansion is being driven by the need for closer proximity to the customer, globalization, telecommuting, offshoring, outsourcing, and the like. With this increase in distributed business operations comes the need for greater control over and centralized management of distributed systems and data. This is true for servers in regional computer rooms and for laptops in branch and/or home offices. PCs and servers in remote or branch office locations are being managed and protected from a centralized point of control, by IT staff, within the datacenter. For IT organizations, the approaches employed to manage and control distributed systems and endpoints are designed to achieve multiple objectives, including: Achieve IT operational objectives such as reducing the data footprint for storage efficiency, application performance, and reduction in backup windows Better visibility into the level of risk or exposure the firm faces in the event of a publicized loss of PC or removable storage media Mitigate potential data loss from hardware failure, file system corruption, or accidental file deletion Mitigate loss in worker productivity arising from the loss of data in distributed endpoints and removable storage media 2 # IDC

3 As shown in Figure 1, firms are deploying PC backups, fueled to a large degree by concerns about potential hardware failure and then by some form of mandate, either legal or regulatory. As a firm grows in size, legal and/or regulatory mandates play a larger role in driving the firm to conduct a corporate-led PC backup approach. For firms with over 5,000 employees, a corporate or legal mandate was the top driver to back up data on endpoints. FIGURE 1 Drivers to Back Up Data on PCs, Workstations, and Laptops Q. What PRIMARILY drove your company to back up data for individual PCs, laptops, or workstations? (% of respondents) All firms (n = 135) Firms with 5,000+ employees (n = 40) Legal or regulatory requirements mandate PC and/or laptops be backed up Concerns about potential data loss resulting from hardware failure Concerns about potential data loss resulting from PC or laptop theft or loss Past PC, laptop, or workstation hardware failures or file system corruption Past accidental file or data deletion Concerns about potential data loss from user error/deletion Past laptop or PC theft or loss Other (Please specify) Notes: Data is not weighted. Source: IDC QuickPoll for PC Backup, September 2009 Figure 2 shows that distributed systems such as file shares and servers, laptops, and desktops are among the top 5 most frequently targeted repositories during a litigation event IDC #

4 FIGURE 2 Most Frequently Targeted Repositories During Litigation Events, Frequency of responses (%) ERP/ERM/HR/CRM/financial applications/databases Shared files/nfs/cifs file systems Laptops/desktops/mobile media/blackberry Database archives (archived ERP-generated content) Check image archives (Tie) Records mgmt/backup tapes/ systems/document mgmt Removable storage (disk/usb) File archives Source: IDC, 2009 FUTURE OUTLOOK IDC research shows that corporations are figuring out strategies to employ technology to meet their data retention, ediscovery, and privacy obligations and at the same time fulfill their operational service levels and cost containment objectives. Closer collaboration between the key stakeholders corporate counsel, compliance, records management, and IT is critical to the successful execution of best practices, including: Adopting consistently enforced enterprisewide information retention and disposition practices, including protocols to discover, identify, define, and enforce retention, disposition, and privacy policies for the corporation's strategic information assets in high-risk content stores Enforcing legal hold protocols for litigation life-cycle management and for the management of ESI identification, preservation, collection, and review 4 # IDC

5 For more on this, see Proactive Information Retention and Disposition Management: When Faced with Litigation Events, Readiness Is Your Best Defense, IDC White Paper #222554, March 2010). When it comes to the technical execution of retention, preservation, and privacy policies in distributed systems and endpoints, corporations have the opportunity to leverage existing technology investments in centralized backup copy. Using a backup as a means to conduct legal holds and serve as a potential collection target offers cost and process advantages over alternative options. For a corporation to do this in a legally defensible way, its information retention and disposition policies would have to: Clearly articulate where and how data retention compliance is executed (typically using the archives and records management systems) Define data protection and backup operations (including PC backup) as primarily for business continuity and recovery objectives (This includes clearly articulated and consistently enforced disposition schedules and protocols for suspending scheduled deletion in the event of a legal hold.) Define the scenario and protocols in place when the corporation will employ the PC backup operations to support ediscovery preservation and collection Advantages of Leveraging Backup Repositories to Support ediscovery Obligations The benefits in leveraging backup technology and processes for ediscovery requirements are most often translated to cost containment advantages. However, breaking down these cost advantages further, the firm can benefit from: Reducing time to respond to ediscovery obligations by leveraging existing processes rather than purchasing and deploying a new approach Conducting early case assessment (ECA) (This would enable the litigant's counsel to gain better predictability on the ediscovery costs as well as make informed decisions on the appropriate response to the dispute or complaint. The legal counsel could also utilize the information from the early case assessment exercise to narrow or expand the scope of the preservation based on the narrative behind the case facts.) Gaining insight into data resident on corporate endpoints for other business or security mitigation purposes Avoiding a standalone technology purchase specifically for ediscovery of data on endpoints Leveraging existing data protection data flows and mitigating the need to introduce separate and additional collection processes on the endpoint Reducing storage costs by eliminating the need to store redundant collections of custodian data 2010 IDC #

6 However, a centralized backup repository to support ediscovery processes must be used in a consistent, repeatable, and legally defensible manner. IT organizations must solicit support and involvement from corporate legal counsel and litigation support and legal technology staff to ensure that policies and processes do not put the corporate litigant's ediscovery processes and policies into question and thus make these exploitable by a savvy opposing counsel. Considerations include the following: Minimize overhead/processing on the endpoint and make the process as transparent as possible to the user Maintain chain of custody during collection and mitigate modification with metadata on files that are preserved and collected Support for both metadata and keyword searching, reporting, and collection Support for local archives (PSTs or NSFs) and ability to locate files within those stores responsive to given keywords Provide some frequency for updating the collection based on the introduction of new data on the endpoint Centralized role and controls (authorized users) for cross-custodian search and collection Ability to integrate with other ediscovery tools and workflows by exporting data in formats ingestible by review and ECA tools IRON MOUNTAIN CONNECTED SOLUTIONS Iron Mountain Connected Backup Iron Mountain Connected enables firms to eliminate the risk of data loss on desktops and laptops with simple, automatic, secure, and reliable backup. Iron Mountain Connected Backup for PC and Mac includes the following: Automatic backup. Rapid, nonintrusive backup of data without user action or IT intervention. Rapid recovery. Users recover their own data through a secure Web portal or perform a system rollback all without IT intervention anytime, anywhere. Data reduction and deduplication. Significantly reduce costs by cutting storage needs by up to 85%. Scalability. Back up as many as 10,000 PCs/Macs on a single pair of datacenter servers with one centralized tool. Security. Data is encrypted at the source, in transit, and during storage with 128- bit AES and stored at a high-security offsite Iron Mountain facility. Different deployment options. Available as a subscription service, licensed software, or a hybrid model that combines both service and software features. 6 # IDC

7 Iron Mountain Connected Classify and Collect Iron Mountain Connected Classify and Collect is an add-on option or module to Connected Backup and leverages the centralized backup as a point of collection of ediscovery. Connected Classify and Collect provides a firm with more visibility into the data on a PC by leveraging and looking into the centralized backup copy. Once a custodian data backup is sent to the central Connected Backup server, a Classify and Connect scan process, which runs in the background, collects files from a given custodian backup and creates an inventory of the backup. The collection and inventory process creates two digital signatures for each file. One signature is created for the file metadata, and another signature is created for the data itself. Administrators can target collection by a user or group of users, as well as schedule the frequency of collection updates. Administrators can also specify keywords that enable Classify and Collect to identify specific files or s within a PST. In addition, they can run reports or queries against the inventory. Once the inventory is created, results are presented to Classify and Collect users for reporting, filtering, and ad hoc searches against the repository. Collections can be organized by legal matter or case, as well as by custodian using a hierarchical folder structure. Responsive files can be viewed in that folder structure and context. Retention policies can be applied at the file level, and legal hold orders can be applied by custodian. Collections can also be exported in a format that can then be used by ECA applications and document review platforms, such as Iron Mountain's Stratify evantage or Legal Discovery Review solutions. The potential benefits of Connected Classify and Collect include the following: Leveraging existing infrastructure and processes to enable ediscovery on endpoints Reducing time to respond to legal demand and reducing ediscovery costs Gaining insight into data on endpoints through reporting, queries, and filtering based on metadata and/or user-specified keyword Satisfying ediscovery preservation orders, record retention, or collection requests CONCLUSION Considerations for Employing Backup Operations for ediscovery Should a corporation choose to utilize its PC backup operations for ediscovery, its IT organization must solicit support and involvement from its legal team. These stakeholders would collaborate to ensure that policies and technical processes for information retention and disposition are clearly articulated and consistently enforced. Here, the corporation should be clear on the distinction between its backup and archiving operations, instead of using backup to realize both operational objectives. The ediscovery protocols should also clearly define the scenario and 2010 IDC #

8 IT controls in place when the PC backup operations are employed to fulfill its ediscovery preservation and collection obligations. Taking these steps would help ensure that the corporate litigant's ediscovery practices are not challenged in court. These steps would mitigate fishing expeditions and avoid wasting time arguing against unreasonable search and collection demands from the opposing party. Determining the Appropriate ESI Legal Hold Infrastructure in Distributed Endpoints Firms face different regulations for how they manage their company information, including data on endpoints. Identification, preservation, and collection of active content in distributed endpoints remain primary concerns among corporations and drive the need for centralization of data. Cross-departmental information management committees to effectively develop, monitor, and manage corporate information assets in a consistent, repeatable, and legally defensible manner are essential to cost containment and risk mitigation objectives. There is no one-size-fits-all approach to enforcing information retention, legal hold, and privacy policies for data in distributed endpoints. IT, working closely with a legal counterpart, should consider the following: Understand the corporation's litigation profile, including attributes such as the number and types of litigation events per year, the average volume of ESI collection per event, the content types and content stores from which ESI is typically collected, and the process and organizational maturity of the corporation's information management and ESI legal hold management programs. Understand the existing corporate information retention, disposition, legal hold and privacy policies, and assess the gaps in the ability of the existing technology infrastructure to execute these policies consistently. Select the architecture that best fits the organizational, process, and technology capability, taking into account: IT infrastructure (This includes the degree of centralization versus decentralization, existing search and indexing architecture, volume mobile endpoints, proliferation of virtualized environments, existence of datacenter consolidation, application/platform decommissioning and retirement projects, and existence of platform or application upgrade plans.) Current information, security, and storage infrastructure technical processes and computer controls IT operational budget and manpower constraints including administration and maintenance, server, storage, and database overheads Network topology and bandwidth requirements 8 # IDC

9 In assessing the planned architecture, identify opportunities for leverage such as common policies, common technical controls, and extending the use case of the technology solution to address complementary compliance requirements. For example, will the classification and search technology enable the organization to address both disaster recovery and ediscovery collections or both ediscovery collections and compliant supervision? Copyright Notice External Publication of IDC Information and Data Any IDC information that is to be used in advertising, press releases, or promotional materials requires prior written approval from the appropriate IDC Vice President or Country Manager. A draft of the proposed document should accompany any such request. IDC reserves the right to deny approval of external usage for any reason. Copyright 2010 IDC. Reproduction without written permission is completely forbidden IDC #

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