Photo credit: Ivan Marc/Shutterstock.com

With the EU's General Data Protection Regulation taking effect later this week, 85 percent of firms in Europe and the United States will not be ready to fully comply on time and one in four will not be fully compliant by the end of this year, according to a recently released report.

The report, “Seizing the GDPR Advantage: From Mandate to High-Value Opportunity,” is from Capgemini's Digital Transformation Institute. France-based Capgemini is a global legal tech consultant.

The report, which came out last week, seems to contradict other recent studies that place compliance figures at a higher level.

Still the company argues that the new law creates new opportunity “for organizations who get it right.”

For example it found 39 percent of consumers have increased their spend with firms that are protecting their personal data.

That conclusion coincides with one from IBM's Institute for Business Value, which recently released a survey that found a majority of companies saw the new law as an opportunity that could help them improve privacy and data security, and serve as a “spark for new data-led business models.”

The Capgemini survey included 1,000 executives and 6,000 consumers across eight countries—the United States plus seven European nations.

With the Friday deadline approaching, the report said 63 percent of U.S. respondents stated they will be largely or completely compliant.

The report said there is “a mixed picture across Europe” however. British businesses are the most advanced, despite only 55 percent reporting they will be largely or completely compliant. Spain at 54 percent, Germany at 51 percent and the Netherlands at 51 percent are close behind. Of the eight countries surveyed, Sweden seems to have the most work to do, with just 33 percent of Swedish firms saying they will be compliant on time.

The research suggests that some companies are overlooking both a possible business opportunity as well as the consequences of noncompliance.

Nearly one-third of firms indicated they are focusing on compliance only, and not looking for a competitive advantage. Although non-compliant organizations face fines of up to 4 percent of annual revenue, nearly 19 percent said ensuring they are prepared is not a priority.

In other key findings, the report said:

  • The GDPR is an opportunity waiting to be tapped—individuals are more willing to engage with, and be more loyal to, organizations that protect data. When convinced, individuals have increased spend with an organization by as much as 24 percent.
  • But if consumers are unhappy with organizations' GDPR compliance performance, over 70 percent said they are prepared to decrease spend, stop doing business with the organization, and warn their friends.
  • To convert the GDPR from mandate to opportunity, organizations must take a series of steps, ranging from educating customers and citizens and winning their trust, to building a culture of respect for personal data within the organization.

“Executives now have a great chance to use GDPR to create a customer-first privacy strategy,” said a statement from Willem de Paepe, global GDPR leader at Capgemini. “Beyond gaining consumer confidence and increased spending, knowing exactly what data is held allows firms to use analytics more effectively and improve operations.”