It is a matter of existential threat:
We live in a world where organizations have become overtly technology dependent with digitalized systems and online services. Reported breaches of information security have been rising at an alarming rate. It is not a matter of ‘if’ your organization will face a breach anymore. Nowadays most organizations are aware that they may have already been breached or are in the radar of sophisticated cyber criminals. Terms like ‘cyber fatality’ doing its rounds in corporate parlance reaffirms that a high level digital breach can actually spell doom for an organization. It is easy to understand why cyber-crime is accelerating if we look from a hacker’s perspective. It involves limited risks while the potential rewards are rather high. With certain governments’ sponsoring cyber espionage in the world of cybercrime hackers get paid for just ‘trying’.
One also needs to keep in mind the “consumerization” of IT that has been a source of concern among IT professionals for years, along with the increase of Bring Your Own Device (BYOD) trend. Consumer-grade equipment tends to be more vulnerable to attack and prone to failure. As more mobile devices get used for businesses, the risk of data theft goes up. Once upon a time cyber security used to belong exclusively to the IT department and was considered important but only as a small piece of the business. Businesses have outgrown this model, as what used to be considered information technology has evolved to embrace business itself, permeating every aspect of it, governing its range, speed and of course possibilities.
The phrase cyber risk does not refer to a specific risk. For example, most organizations may tend to focus on data privacy issues while for some it may be related to daily operations. It can be a singular or a group of risks which are clubbed together due to two major similarities that at some point they seemed impossible and that they have the potential of great negative impact on the business. Cyber risks also denote an organization’s overall security posture – how much risk is the business at and what steps should it take to ensure the damage is least for the organization. Combined with cyber insurance, it covers what a company can do in terms of security coverage to combat the daily threat it faces.
Cyber risks should be a business priority:
The way an organization handles information technology, more specifically cyber security, reflects the way they think about the company’s place in the contemporary market. Fast-evolving, multi dimensional threats exist across all sectors though the exact risk spectrum varies by industry. Rapid consolidation through mergers and acquisitions means that many companies now operate across multiple industries and locations. An organization’s security framework may be sufficient for its original sector or geography, but expansion calls for security measures to be reviewed in multiple steps.
Cyber risks should be a business priority not to convert the CEOs and CFOs and various other business leaders into technologists, but for businesses to adapt to the digital landscape in which they operate in. This requires effort from both management and IT to find an adaptable middle ground to reduce breach incidents.
Reasons why it is imperative to care for cyber risks:
Cyber risks may be technological in nature, but their effects are purely business effects and as such any business is measured and judged by how well they handle them. Some of the crucial ones are:
Customer protection: When we talk about cyber risk what is most often at risk are personal information of customers like their credit card info, medical records, addresses and phone numbers and other such sensitive information. Most data breaches try to acquire and exploit information in a way that can have a serious impact on the lives of the people to whom it belongs. Real people are affected if their data is compromised and the process of undoing that damage can be stressful and expensive.
Financial Costs: Data breaches are rather expensive. Some of the most obvious vectors impacted are falling stock prices, investigative and forensic efforts, identity protection services for affected customers, PR initiatives, media and legal consulting among others. Indirect financial costs include loss of customers, both current and potential, reactionary cyber security remediation and any time incurred during remediation.
Product protection: One of the major targets of cyber attacks is proprietary business data. For many companies, this data is their business. If it becomes public, or is sold to competitors or a state entity, the profitability of the breached company can be severely harmed. Digital documents are extremely important to most businesses and their disclosure is a business problem, not just an IT problem.
Reputation: For an organization losing crucial information due to a breach can result in criticism, mockery and lack of confidence by customers in the said organization. If people associate a certain brand name with a data breach incident, it is unlikely that they would choose to use services or product at a later point in time, regardless of what measures have been implemented since then. Current customers may be motivated to switch to a competitor if they feel they can no longer trust a company with their information. Furthermore, a company with a known breach may attract other cyber attackers assuming the company has weak security. The reputation issue extends beyond the company to those managing it.
Integrated cyber risk approach
Businesses, for a better understanding of their cyber risk posture, must incorporate cyber security habits into the entire organization. Cyber security is a challenge for most businesses primarily because of the layers they accumulate. Overlapping systems built up over a period and the addition and subtraction of existing employees each with different IT habits create a complex and multi-faceted cyber environment that is difficult to manage and navigate. Most of the cybercrime victims had installed anti-virus or cyber security suites; the problem is one of user-habit. A huge percentage of known breaches involve stolen credentials where mostly the credentials are offered up by the victim, either by persuasion or because of ignorance. Investments in high-quality, expensive cyber security suites or firewalls will not be utilized to their full potential if organizations fail to address employee naivety of basic cyber security analytics essentials.
As traditional and digital worlds converge, security threats to business operations become increasingly complex. Emerging technologies, user mobility and the sheer volume of data exchanged daily all represent opportunities for hackers to target the digital assets. One attack is all it takes to jeopardize an organization’s stability, if not its very existence.
With such high stakes, successful business leaders transform their cyber security strategy by giving it due consideration and aligning it with core business objectives. A deeper understanding of known and unknown threats from an organizational perspective, business-critical information and how to implement digital security effectively throughout an organization helps improve and protect business performance.
Mahendra is a former Happiest Mind and this content was created and published during his tenure.
