A security breach is an incident that results in unauthorized access of data, applications, services, networks and/or devices by bypassing their underlying security mechanisms. This can be as small as stolen names or drivers license numbers to distributing malware, SEO/e-mail spam, or phising sites. It is important for all businesses to understand the consequences of a data breach.
Data security has become a large part of IT conversations as the world has witnessed major corporate enterprises such as Target, Yahoo and Marriott Hotels, fall victim to cyber security hacks. However, small and medium sized businesses are also at risk and it can be much more difficult for them to bounce back than enterprise-sized counterparts. Furthermore, when a security breach occurs, it’s not just information technology that’s vulnerable, but the entire business is in jeopardy and its future hangs in the balance.
Companies need to learn the top consequences of a security breach, but first there are five questions businesses want to think about.
- What is the value of the companies data?
- Who has access to the companies data?
- Where is the companies data stored?
- Who is protecting the companies data?
- How well is the companies protected?
Knowing the answers to those questions makes understanding consequences due to security breaches a lot easier. Some of the top ones are listed below.
- Financial Hits
A company may pay tens of thousands of dollars in ransom to get back their data or they may need to retain a lawyer and additional IT Support. But mostly, it comes down to trust, or rather loss of trust. The company that experienced a security breach is going to loose business when their customers or clients turn elsewhere.
- Damage to Reputation
If a company has put their customers’ personal information in jeopardy, it’s safe to say there may be some “trust issues” moving forward with their clients and customers. However, consumers will be less likely to give their business to a company that has dealt with a data security breach and will move onto a competitor. Similarly, potential employees, investors, and partners may shy away from working with a company who has a damaged reputation.
- Loss of Proprietary Information/Intellectual Property
There’s a lot of valuable information within a company that doesn’t just include social security numbers and names. For example, the creativity and tools that gives a business it’s competitive edge. If a data breach occurs that information can be released to the public. The tools that companies use to push their business to the top of their market are no longer influential. The theft of this type of information can cause a business to completely lose their competitiveness and flounder.
- Other Costs
Surface level costs are just the beginning to a date security breach. Besides the legal fees or ransom that may be needed, there may be hefty fines incurred by regulatory bodies. On top of that, there’s a good probability that insurance premiums will go up dramatically.
It’s crucial to incorporate IT security and data security into company business strategies so that they don’t find themselves unprepared if a data breach were to occur. If you don’t know where to start, Graffen is here to help you determine how to protect your business. If you already have a strategy in place, we will make sure it’s rock solid. We’d love to discuss further with you!