How Much Does Cybersecurity Cost?
In today’s world businesses around the world as well as in Australia, face increasingly...
The impact of cybercrime on a business can be catastrophic. Many types of cybercrime can shutter a business permanently. This is one reason that experts in our industry suggest that you craft a cybercrime business continuity plan to accompany the plans you likely already have to manage other forms of disaster.
The best thing you can do to help your company with cybercrime disaster recovery is to have a plan in the event a cyberattack happens. Staying ahead of threats is central to risk management.
Where this gets complex is that you may not fully understand the effects of cybercrime on your business before it happens. So let’s review.
What is a cybercrime
As Techopedia explains it, “cybercrime is defined as either a crime involving computing against a digital target or a crime in which a computing system is used to commit criminal offenses.
As a broad category of crime, cybercrime includes such disparate sorts of activities as illegal access of data, use of computer communications to commit fraud, or the ransoming of systems via digital means.“
Though you may assume that your company is safe, it’s most likely that you are not.
Computer hackers prey on small and medium-sized businesses. National Cybersecurity Alliance says, “There is an idea within some SMBs that they are too small to be attacked because there is less value in their information. It is simply not true. In fact, small businesses are more likely to be targeted with a ransomware attack.”
Elsewhere on our blog, we’ve discussed some of the types of cybercrimes that companies may face. Just a few of these include
These, and other forms of data breaches, put your intellectual property, financial information, and customer data at risk. And all of these can disrupt your business operations.
Cybercrime effects on small businesses
The effects of hacking and other cybercrimes on a small business can be immense. Here are a few of the ways that these crimes can impact your business continuity.
Financial Damage
Financial damage is a primary impact of cybercrime on business. When a cyber-attack happens, the damage to the company’s finances can come in a variety of forms.
- First, of course, a hacker can simply drain the bank accounts if they can access them. This can include corporate bank accounts, but if personal information is accessed, then identity theft could cost individual employees dearly. And, of course, access to your business’ customer’s credit card information could be a nightmare.
- Secondly, ransomware attacks can demand a financial payout in order to end a Denial of Service scenario. According to information provided by National Cybersecurity Alliance, “46 percent of all small businesses have been the targets of a ransomware attack. Of the companies hit with a ransomware attack, nearly three-quarters (73 percent) have paid a ransom.
- A cyberattack can cause many forms of increased costs:
- costs of notifying clients of a data breach
- costs of providing records to law enforcement
- increased insurance premiums
- Your costs may skyrocket.
- You may be stuck dealing with these costs with reduced revenues. If the cyberattack causes any form of disruption in your daily business, revenue will be lost.
Compliance problems
If you work in an industry with governmental compliance rules and regulations, a cybercrime can cause havoc. Your business may need to suspend operations or meet additional levels of scrutiny to continue to serve your clients.
Operational disruption
Investopedia tells us, “In addition to actual financial damages, companies often face indirect costs from cyberattacks, such as the possibility of a major interruption to operations that can result in lost revenue.”
Consider the impact of a disruption on the lives of your staff, on your clients, or on your personal finances. It’s a terrible truth that the criminal activity of others can impact your business in so many ways.
Reputational damage
Some effects of hacking and cybercrime go beyond financial. You may recover the money you’ve lost, but what of the reputation of the enterprise itself?
Isaca explains, “That’s why many organizations employ incident response teams. Analysis of an attack and restoring business operations is key to ensuring that organizations do not fall prey to the same attack or, ideally, the same attacker. However, with a proper incident response and disaster recovery element, technically recovering from an attack simply becomes a matter of restoring services and implementing the appropriate cybersecurity controls to protect an exploited organization.
What takes much longer to restore is public brand perception and customer retention. Companies have shown their fear of customer loss in the past by implementing rather dramatic controls in an effort to keep their customers.”
The way that your company responds to cybercrime can impact your business’ reputation for years to come. If you work in an industry that is deeply tied to the protection of sensitive data–healthcare, for example–a data breach can cause a permanent loss of trust. In any industry, a cybersecurity incident can leave a long-lasting wound.
Time and cost to recover from hacking
As Isaca implied above, a company can recover from a cybersecurity breach in time. A well-managed response can help recovery.
Even so, National Cybersecurity Alliance says, “the cost of mitigating a data breach for small-to-medium-size businesses (SMBs) is far higher than most business leaders are aware. According to AppRiver Software, (USD) $149,000 was the average cost of a data breach for an SMB in 2019. However, most SMB leaders estimate the cost of a data breach to be around (USD)$10,000. Only 19 percent of survey respondents acknowledged that costs could surpass (USD) $100,000.”
Prevention is always the best course. But should that fail, you’ll want to ensure that you have a solid cybercrime business continuity plan. Your plan should be able to be implemented for an attack of any size and severity.
Let our team of cybersecurity experts help you stay ahead of threats & attacks against your organisation. Contact StickmanCyber today to learn more about our Threat Monitoring, Detection, & Response services.