Cybersecurity – What is the Cost of Doing Nothing?

Cybersecurity – What is the Cost of Doing Nothing?

In today’s world, the importance of cybersecurity cannot be overstated. With a surge in cyber threats, from data breaches to ransomware attacks, individuals, businesses, and organisations of all sizes are at risk. The question isn’t whether you can afford to invest in cybersecurity; it’s whether you can afford not to. In this piece, we will explore the substantial costs associated with doing nothing in the realm of cybersecurity and discuss the importance of proactive cybersecurity.

The Cybersecurity Landscape

Survey results from the Cybersecurity Breaches Survey 2022 conducted in the UK provide a snapshot of the current cybersecurity landscape. In the last 12 months (2022), a staggering 39% of UK businesses identified a cyber attack as part of this survey. The most common threat vector they faced was phishing attempts, which accounted for a significant 83% of these attacks. This statistic underscores the prevalence and effectiveness of phishing as an attack vector, highlighting the need for robust email security and employee training in identifying phishing attempts. At Elite Group IT, we have a range of products that can help reduce the risk of a cyber attack, including ‘Elite Cyber Secure,’ which provides real-time training, simulations, and quizzes to staff to help identify and flag attacks. Additionally, our sophisticated reporting system allows for organisations to deliver targeted cybersecurity training to those who failed phishing simulation attacks.

Despite its lower prevalence, organisations cited ransomware as another major threat, with 56% of businesses having a policy not to pay ransoms. Ransomware attacks can be devastating, with cybercriminals encrypting an organisation’s data and demanding ransoms for decryption. However, organisations’ resistance to paying ransoms is a positive stance, as paying the ransom does not guarantee data recovery and can further incentivise attackers. The best way to defend against an attack is to prevent it all together, Elite Group IT’s Web Defender has two distinct plans aimed at meeting your or your businesses’ needs. Web Defender Plan 1: this plan provides essential security features for safeguarding Microsoft365 environments, including threat protection, attack surface reduction, and automated investigation and response capabilities. Furthermore, it established a foundational layer of security to shield against common threats. In addition to all the features included in Plan 1, Plan 2 delivers an array of advanced security features, comprehensive threat protection, and heightened capabilities for detecting and responding to sophisticated targeted threats. In summary, Plan 2 goes above and beyond Plan 1, offering a more extensive and advanced security solution to cater to diverse security needs.

The Costs of Doing Nothing in Cybersecurity

1. Data Breaches

One of the most significant and well-publicised cybersecurity threats is the data breach. When an organisation’s data is compromised, the consequences can be severe:

Financial Losses

Data breaches often result in direct financial losses. Organisations must cover costs related to notifying affected individuals, providing credit monitoring services for those affected, paying legal fees and regulatory fines, and conducting remediation and recovery efforts. The average estimated cost of all cyber attacks in the last 12 months, among organisations reporting a material outcome such as loss of money or data, is £4,200. For medium and large businesses, the cost is significantly higher, averaging £19,400. It’s important to note that the lack of a standardised framework for assessing the financial impacts of cyber attacks may lead to underreporting. Nevertheless, these costs serve as a reminder of the tangible financial consequences of inadequate cybersecurity measures.

Legal Consequences

Data protection regulations, like the General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA), require organisations to safeguard customer data and privacy. Failure to do so can result in significant regulatory fines and legal action.

Reputation Damage

A tarnished reputation is one of the most intangible but critical costs of a data breach. Restoring trust with customers, clients, and stakeholders is a lengthy and costly process. The loss of reputation can lead to decreased revenue and a decline in the organisation’s brand value.

2. Financial Losses

While data breaches account for a significant portion of financial losses, other cybersecurity threats can lead to financial ruin:

Ransomware Payments

Ransomware attacks have become increasingly prevalent. Cybercriminals use malicious software to encrypt an organisation’s data and demand a ransom in exchange for the decryption key. Paying the ransom is a double-edged sword; it might result in data recovery, but there are no guarantees. Furthermore, it encourages attackers to continue their criminal activities.

Opportunity Costs

Dealing with a cyberattack, from incident response to recovery, diverts resources and attention from core business activities and growth opportunities. The time and money spent on these efforts could have been invested in innovation, expansion, or other strategic endeavours.

3. Downtime and Productivity Loss

Cyberattacks can disrupt operations, leading to downtime and decreased productivity. The longer it takes to recover from an attack, the more revenue is lost due to this downtime. Organisations may also need to invest in new systems or technology to replace compromised infrastructure, further increasing the financial burden.

4. Intellectual Property Theft

For businesses, the theft of intellectual property can be devastating. Whether it’s the theft of trade secrets, proprietary technology, or research and development data, losing intellectual property can result in a lost competitive advantage, diminished market value, and a significant setback in terms of innovation.

5. Customer Trust

Once a breach occurs, customers may lose trust in an organisation’s ability to protect their data. This can lead to reduced customer retention and even customer churn as individuals seek out more secure alternatives. The cost of acquiring new customers to replace those lost due to a breach is often higher than retaining existing ones.

6. Regulatory Compliance

Failing to comply with cybersecurity regulations can lead to regulatory fines and penalties. The cost of compliance is far less than the cost of non-compliance.

Outsourcing & Supply Chain

Survey results show that organisations, whether small, medium, or large, increasingly outsource their IT and cybersecurity needs to external suppliers. This approach provides access to greater expertise, resources, and standards for cybersecurity. Notably, small businesses outsource 58% of the time, medium businesses outsource 55%, and large organisations outsource 60% of the time. While outsourcing can be beneficial, it’s essential to assess the risks posed by immediate suppliers. Alarmingly, only 13% of businesses assessed these risks, with many organisations stating that cybersecurity was not a significant factor in their procurement processes.

The Importance of Proactive Cybersecurity

The significant costs associated with doing nothing in cybersecurity underscore the importance of proactive measures. Cybersecurity should be viewed as an investment in protecting an organisation’s financial stability, reputation, and longevity.

Microsoft Intune is a cloud-based service, provided by Elite Group IT, which is used for managing & securing mobile devices as well as applications in an organisation. Intune is the go-to choice for organisations looking to implement modern management and security practices. Our experts handle subscription checks, portal access, initial settings, enrollment, deployment and more, with  your success in mind.

Here are some additional steps that individuals and organisations can take to bolster their cybersecurity:

1. Risk Assessment

Conduct a comprehensive risk assessment to identify potential vulnerabilities and threats specific to your organisation. Understanding your risks is the first step in creating a robust cybersecurity strategy.

2. Security Policies and Training

Develop and implement security policies and procedures. Employee training is a critical component to ensure that everyone within the organisation understands and follows security best practices.

3. Regular Updates and Patch Management

Ensure that all software, hardware, and systems are regularly updated and patched to address known vulnerabilities. Cybercriminals often exploit outdated systems.

4. Network Security

Implement strong network security measures, including firewalls, intrusion detection systems, and encryption protocols to protect data in transit.

5. Data Encryption

Encrypt sensitive data at rest and in transit to protect it from unauthorised access. Encryption is a crucial component of data security.

6. Incident Response Plan

Develop a clear incident response plan that outlines steps to take in the event of a cyber incident. This plan should include communication strategies, recovery procedures, and legal obligations.

7. Regular Testing

Conduct penetration testing and vulnerability assessments to identify weaknesses in your cybersecurity defences.

8. Backups

Regularly back up critical data and systems to ensure that you can recover quickly in the event of a ransomware attack or other data loss incidents.

9. Cyber Insurance

Consider cyber insurance to mitigate the fiscal impact of a cyber incident. While it doesn’t prevent attacks, it can provide financial support for recovery efforts.

Conclusion

The cost of doing nothing in terms of cybersecurity is significant and multifaceted. The financial, legal, operational, and reputational consequences of a cyber incident can be severe and sometimes insurmountable. While cybersecurity measures come with a price tag, they are a fraction of the potential costs and damages incurred because of a significant cyber incident. Proactive cybersecurity measures are an investment in safeguarding an organisation.

Elite Group IT is the Islands only privately and locally owned Telecommunication and IT service provider. Established from the merger of Wi-Manx and IT Works Limited in 2021, we are an Isle of Man company, investing in the Island and its community. We can meet your infrastructure, connectivity, and cybersecurity requirements. To find out more about what we can do for you, please email sales@elitegroupit.com or call 663333 to find out more.