[et_pb_section admin_label=”section”][et_pb_row admin_label=”row”][et_pb_column type=”4_4″][et_pb_text admin_label=”Text” background_layout=”light” text_orientation=”left” use_border_color=”off” border_color=”#ffffff” border_style=”solid”]
Cybersecurity is often perceived as merely a response to operational risks. In reality, it’s much more than that – it is a crucial part of preventing systematic risk, because without cybersecurity the future of a business which cannot fully and safely execute its digital transformation is in danger.
People usually talk about risk when approaching the subject of cybersecurity. Risk is often also the first argument put forward when defending the security budget: “If we do nothing we risk…”
But what do we risk, exactly?
The standard response here is often very straight-forward: a data breach, a production delay, losing several days’ work while restoring systems, or no longer being able to send clients an invoice at the end of the month.
Presenting the risk in this way is to essentially label it as ‘operational’. While this is an important point, we should not link cybersecurity to just the everyday operations of a business. Instead, we should focus on something more worrying: the ‘systematic’ risk. This is the key concern that should be used to highlight the importance of cybersecurity.
For economists, systematic risk is something that relies on the financial system of an organisation, but not on certain markets or economies in particular. According to the BCE (European Central Bank), it is a risk capable “of negatively impacting the growth and well-being of individuals”.
When applied to a business, systematic risk is therefore something that has the potential to impact negatively on the company’s growth, its capacity to remain stable or alter its position in the market. Even if organisations feel that innovation is crucial, many of them will delay digital transformation and innovation projects because the risks associated with cyberattacks are judged to be too great.
Conversely, a business would be affected by systematic risk if it ignored digital transformation, as today this is a key differentiator in many different industry sectors.
Cybersecurity should be a fundamental element in a company’s digital strategy
Digital transformation has demanded that businesses reinvent themselves and take account of innovative data control practises (for example Open Data, Big Data and collaborative data) while responding to new business requirements. The importance and degree of digital transformation varies according to the industry a business operates in, but ignoring such a huge global movement would surely be a huge risk for any organisation.
Businesses incapable of undertaking such a transformation could find themselves easily replaced by more digital competitors, and could lose their precedence and position as an industry expert. This is particularly true of the retail industry where shops and big brands can no longer ignore the benefits of digitisation; technology allows them to offer a personalised online and connected service, based on a deepened understanding of clients to improve their loyalty or assure optimal stock management.
However, to make this technological transformation happen, it is necessary for businesses to have a strong and solid digital foundation. Without effective practises, tools and processes dedicated to cybersecurity, initiatives based on digitalisation could make an organisation more fragile, and leave them exposed to avoidable operational damage (data breaches, regulatory or legal problems). It is precisely this which contributes to the systematic risk of technological advancement: by ignoring the threat of cybercrime because they are scared, and because they don’t have a solid digital foundation, organisations risk setting themselves up to fail.
The true ‘business case’ for cybersecurity lies in its ability to help organisations prosper and grow in the age of digital transformation. The right cybersecurity solution can allow a business to undertake a technological transformation as smoothly as possible, while making sure the company does not lose its position as a market leader and ensuring it is not overtaken by more naturally agile and digitised competitors.