Security – Do You Know Your Digital Risk?
Rapid technological advancement and rising global connectivity are reshaping the way the world works. From higher productivity to improved customer satisfaction, technology has played a critical role in the growth of businesses across the world. However, technological advancements have also made organizations increasingly vulnerable to digital risks. Despite this, businesses do not need to compromise on growth and advancement for the sake of security.
The security challenges within these digital environments can be better addressed if organizations know how to identify these risks and incorporate preventative security measures and controls, along with proactive solutions and detailed plans, to overcome their digital vulnerabilities. Let us discuss the different types of digital risks you should be looking out for, and how you can use this information to get a positive ROI.
Types of Digital Risks
New disruptive technologies have led to an increase in digital risk for businesses. These risks are seen in various industries and are more pervasive than cybersecurity risks. On a broader scale, digital risks can be classified into physical, technical and administrative risks.
The following risks are the most prevalent in today’s digital world and should be treated as top priorities for your business:
- Cybersecurity risk: This is the type of risk that most business owners are already familiar with. This is because of its potential for damage and coverage in the media. Cyberattacks continue to evolve as businesses become more technology-driven. Today’s cyberattack is not the same as it was twenty years ago. Attacks like ransomware, DDoS, etc., can bring a halt to the normalcy of any business. Though it is hard to say just how destructive a cybersecurity attack will be, they are almost always devastating.
- Data privacy risk: As we move forward to a knowledge-based economy, data has become the most valuable commodity in the world. This has resulted in hackers targeting critical business data and misusing them for personal gains. Targets for these kinds of attacks are usually those in an organization with the most access to data. This includes CEOs and other top executives. While these members may think they are immune to digital risk because of their rank, they are actually the ones in the most danger.
- Compliance risk: Businesses need to adhere to various regulations regarding data privacy, cybersecurity, organizational standards of practice, etc. These policies are put in place to protect customers, but they also have many benefits for businesses too. The safer your customers are, the safer your business will be. Any violation can attract heavy fines and penalties for a business. Thus, it is important that these standards are always met and adhered to.
- Third-party risk: When you outsource certain services to third parties, it might compromise the security of your IT infrastructure. For instance, a software tool you develop with an external vendor may introduce some vulnerabilities to your otherwise intact digital environment. This means that you should try to keep everything as in-house as possible. The more self-sufficient your business can be, the safer it is as well.
- Resiliency risk: This concerns the ability of a business to bounce back and continue operations after an unexpected disaster. This is more important than ever with the recent events in the world. The pandemic is just one example of a global issue that could greatly impact a business. Resiliency risk is ultimately what made many companies go under last year.
- Risks due to human errors: In the UK, 90 percent of cyber data breaches were caused by human errors in 2019. Whether it’s falling for phishing scams or misusing work devices, human errors can be quite costly for organizations if they go unchecked. This is why it is important to give members of your team as much training as possible. The higher their computer literacy, the more protected their business is. That extra training is worth the security it brings to your organization.
- Automation risks: While automation is reshaping the tech industry for the better, it could also give rise to a range of risks such as compatibility risks, governance risks, etc. This type of risk is hard to account for because it often comes with the latest technologies. Staying informed on automation is the best way to avoid this threat.
- Cloud storage risks: The flexibility, ease-of-use, and affordability offered by the cloud make it one of the most popular options for backup and storage. However, the cloud is also prone to various risks such as lack of control over data, data leakage, data privacy, shared servers, etc. This is why you must consider the drawbacks before switching to cloud-based storage. Also, never rely on it solely. Having multiple storage options gives you an extra level of protection.
Importance of Risk Assessment in Managing Digital Risks
The best way to start managing your digital risks is by performing comprehensive security risk assessments regularly. After all, how would you know what your current vulnerabilities are and where your biggest security challenges lie without an ‘under the skin’ examination? With a risk assessment, you can measure your security posture against various internal and digital threats and determine how equipped you are to deal with these risks. When you perform a security risk assessment you can proactively:
- Identify vulnerabilities: A risk assessment helps you identify which part of your digital environment is relatively weak against various security threats. You can identify which systems are likely to be targeted by attackers and incorporate measures to strengthen those systems. Without the information presented by your risk assessment report, you don’t stand much chance of improving your digital security posture against various vulnerabilities.
- Review and bolster security controls: In most cases, security incidents occur due to a lack of controls in the process. For instance, without proper cybersecurity awareness training and best practices training, employees are unlikely to follow security protocols on their own, which could result in losses due to human errors. Based on the risk assessment, you can upgrade your securities and incorporate preventive measures against various risks.
- Track and quantify risks: To effectively manage various risks, you need to know the effect of these risks on your business. With a risk assessment, you can quantify these risks by identifying the potential losses posed by various threats. This helps you incorporate necessary risk mitigation strategies to prevent your exposure to various risks.
The Value of Risk Assessment
IT and security budgets are often difficult to explain to management. Everyone understands the consequences of not investing in correct security measures. However, it isn’t that easy or simple to put an exact ROI figure on security investments. The value of risk assessment is based on how you choose to act with the information you get from these reports.
In this scenario, the real question is – what is the cost of not making this investment? Let us consider a major data breach for example. It is always about what you stand to lose in the aftermath of a breach. If your business is dealing with valuable customer data, a data breach can result in unrecoverable financial losses as well as reputational damage. Moreover, this might also result in regulatory non-compliance and attract heavy penalties from various regulators. In such cases, reviving a business after a major disaster can be almost impossible. A single breach could ultimately lead to the total loss of your business.
Here, the cost of investment in security solutions and cyber insurance is negligible since it concerns the survival of the business. You may not be able to measure the exact ROI of the airbags in your car but that does not mean that your survival is not dependent on them. Similarly, the information and insights gained from routine risk analyses are critical to the operation, resilience posture, and long-term success of your business.
Assess Your Risks the Right Way
Monitoring and managing your digital security risks is a continuous process that must be done regularly and should be a part of your ongoing operational strategy. To implement it the right way, you need to create a risk monitoring strategy that focuses on what risks need to be identified and how to identify them.
Reach out to us today to perform a complete risk assessment of your digital infrastructure and help you build a resilient security posture against various threats.