How can companies effectively balance the need to outsource certain business functions with the responsibility to protect customer information and maintain data security?

Companies can effectively balance the need to outsource certain business functions with the responsibility to protect customer information and maintain data security by thoroughly vetting and selecting trustworthy third-party vendors who have strong data security measures in place. They should also clearly outline data security requirements in contracts and regularly monitor and audit the vendor's compliance. Implementing strong internal data security protocols, such as encryption, access controls, and employee training, is crucial to safeguard customer information when outsourcing. Regularly reviewing and updating data security policies and procedures, as well as conducting risk assessments, can help companies proactively identify and address potential vulnerabilities in their outsourcing arrangements.