You’ve definitely read or heard news stories about cyber-attacks on companies across the world. In fact, it’s no longer a secret that cybersecurity threats have become increasingly frequent and quite costly. Nobody is safe from cyber-attacks. Every organization that conducts its operations via the Internet, communicates through email and chat, or uses any form of Internet-related features is at risk of cyber-attacks.
There are numerous ways your business can be a victim of cyber-attacks. For instance, one of your employees can accidentally or deliberately send an email that contains sensitive business or customer data to the wrong recipient, or you may lose a company laptop or mobile device with confidential business information. A hacker can even manipulate his or her way into your network and steal or corrupt your files. There are endless ways a hacker can install a phishing program on your computers or the entire network and gain access to your business or customer data.
With the increasing complexity and frequency of cyber-attacks today, it is important for every business or organization to be aware of the seriousness and impact of cybersecurity risks on their businesses and what they can do to avert the attacks.
Impact of Cybersecurity Attacks on Your Business
A cyberattack that has been successfully executed can cause significant damages to your organization. It can not only adversely affect your bottom line but ruin your company’s reputation and customer trust. Investors normally shy away from businesses that have fallen victim to cyber-attacks. The value of your company can also take a significant dip after a successful security breach. For example, after it was revealed that Yahoo! had suffered two massive data breaches that affected more than 2 billion users, the company’s price dropped by $350 million in an acquisition deal by Verizon.
Cybersecurity risks are not exclusive to large corporations but can affect small and medium businesses too. Just about anyone who uses the Internet for communication, shopping, paying bills, entertainment, or for any other purpose is prone to cyber-attacks. You cannot afford to ignore cybersecurity.
The impact of cybersecurity breaches can be divided into several broad categories including financial or economical, reputational, and legal. Let’s take a look at each type of impact and how you can safeguard your company from the adverse effects of cybersecurity breaches.
Financial Impact of Cyber Threats on Your Business
There are many ways a cybersecurity attack can create a substantial monetary loss for your business. The monetary losses can arise from theft of sensitive information about the company or its customer’s finances such as payment card and bank details. Monetary losses can also arise from a successful cyber theft attempt that ends up in loss of money or disruption of trading operations such as an inability to process online transactions.
A successful hacking attempt will not only devalue the financial worth of your company as seen in the case of Yahoo! but may also result in a cancellation of an important business deal or contract. A business that suffers a cyber-hacking attack will also incur significantly excessive costs of recovery and repair of the affected networks, devices, and the general IT infrastructure. Depending on the level of damage, recovery costs can be quite substantial.
Impact on the Company’s Reputation
A successful cyberattack can mess up the reputation of your business and erode the trust you’ve built with customers, suppliers, and shareholders over many years. Remember trust is one of the most critical components of customer relationship. Everyone who deals with your business needs to be assured of the safety of their personal and financial details.
If your company’s security system is compromised, you’ll likely lose customers, lose sales, and consequently suffer a massive reduction in profits. A reputational damage due to cybersecurity breaches will negatively impact your relationships with suppliers, business partners, investors, and other companies whose interests are vested in your company. For a moment, your business may be viewed as a leper to keep away from.
Legal Impact of Cyber Attacks on Your Business
There are data protection and privacy laws that regulate security management of all personal and financial data your company holds – whether it’s customer or employee data. If your security is compromised and the customer or employee data either accidentally or intentionally leaked to other parties with malicious intentions, then you’ll have failed to put in place appropriate security measures and you may liable for non-compliance fines and sanctions from regulatory bodies. Failure to comply with data security standards set by Payment Card Industry Data Security Standard (PCI/DSS) or the recently implemented General Data Protection Regulation (GDPR) for companies with operations in the European Union may result in high monetary penalties.
Minimizing the Impact of Cybersecurity Breaches on Your Business
Security experts often advise companies to focus on the basics of computer security as the starting point in prevention and mitigation of cybersecurity breaches. When you think of cyber threats start by figuring out what you need to protect most, which in most cases include the company’s finances, credit card transactions, customer and employee identities, the people you deal with, and your company’s reputation. You can then develop the right processes and procedures to protect these precious assets.
It also worth knowing that not all cyber-attacks are executed by sophisticated criminal organizations. Some are just lone actors who’ve identified a loophole in your information security infrastructure. They are just like the regular home burglars who search for vulnerabilities in your security and exploit the flaws to gain access. A burglar would not bother to pick your front door lock if your kitchen window is wide open. Likewise, a hacker will only attack your business if you’ve left too many loopholes in your security system that can be exploited successfully. To ensure that your system is secure, take time to run penetration tests preferably by professional IT security services such as Venkon. Penetration tests are simulated real-life attacks on your system to identify and mitigate threats to your security system before hackers strike.