In the modern-day and age, as an increasing number of enterprises jump on the ‘digitization’ bandwagon, and companies welcome with eager arms the amalgamation of technologies such as artificial intelligence and machine learning into their security infrastructure- the course of the business landscape has been significantly altered by the advent of digitization and technology adoption.
A couple of decades ago, even the mere notion of an online enterprise might have seemed ludicrous. Fast forward a couple of years, and now we’ve got an entrepreneurial landscape that gives rise to e-companies that pride themselves on how user compatible their digital interfaces are. To further demonstrate the extent of the change within the business landscape, consumers can now pay through a contactless method, deposit money into their account from the luxury of their homes, along with executing complex functions such as remotely setting the interior cabin of a car to a suitable temperature.
Needless to say, advancements in technology, for the most part, have given way to a digitized revolution within the business landscape. It is also worth mentioning, that the monumental alterations seen in the the digital enterprises today also hinges on the ever-increasing number of IoT devices connected on a single network, which implies that the change seen is generational, and will only get bigger from here onwards.
As the technological advancements seen in recent times become a focal point for an organization’s future business prospects- organizations of every kind- including government, intelligence and private entities have all embraced with open arms the ease that technological progress brings.
With that being said, however, most organizations usually fall short in coming to terms with the realization that advancements in technology come at the expense of several risks and vulnerabilities. If left undealt with for a prolonged time, these loopholes present within an organization’s security infrastructure have the potential to topple down entire corporations, as is made evident by the fact that a staggering 60% of small businesses close down within 6 months in the aftermath of a cyberattack. There are several majors to combat cyberattacks and one such is the use of a VPN. To get more insight about the best VPNs of 2020 visit VPN overview.
Fortunately, despite the ever-increasing complexity and sophistication of the current threat landscape facing organizations, a growing number of security teams are focusing on Enterprise Risk Management (abbreviated as ERM), as a means to achieve long term sustainability within an organization.
In an attempt to aid our readers on their conquest to uphold cybersecurity measures within their organizations, we’ve compiled an article that delves deep into the potential that Enterprise Risk Management has in boosting cybersecurity. But before we can get into all that, let’s start off by describing what ERM is exactly.
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What Does the Term “Enterprise Risk Management” Mean Exactly?
When it comes to ensuring long term sustainability of an organization’s security goals, one of the greatest security measures that an organization can implement is risk management. Simply put, Enterprise Risk Management refers to a plan-based business strategy that focuses on the fulfillment of several goals, including the identification, assessment, and preparation for any potential threats. Typically, these threats include both physical and figurative vulnerabilities, with an acute focus on any threat that interferes with an organization’s internal operations and objectives.
Furthermore, with ERM, organizations can define what an acceptable loss is, particularly within the context of their specific enterprise. Typically, companies define an acceptable loss as the damage that has the potential to disrupt the routine operations of a business. The effective implementation of Enterprise Risk Management also entails organizations the luxury of prioritizing certain threats over others, along with equipping them with the ability to decide which risks should be managed more actively. The magnitude of the benefits offered by ERM can further be recognized by the fact that the security practice is implemented in a wide array of industries, including everything from aviation, construction to energy and finance.
What is the Problem with Traditional Risk Management Methods?
As we’ve repeatedly mentioned leading up to this part in the article, the benefits offered by Enterprise Risk Management are extremely beneficial. The advantages offered by ERM, become even more advantageous when we take into account the shortcomings of going down the traditional risk management route.
Although the ERM security practice has only recently started attention within cybersecurity articles, organizations have been managing risk for a long time. In the past, however, organizations have managed the risks facing them by investing in insurance. When it comes to managing physical losses, organizations rely on buying property insurance that covers for detrimental losses, whereas companies rely on liability insurance and malpractice insurance to cover for the other types of damage.
In spite of the the practice of buying their way out of the responsibility of securing their organizations having worked in the past, the modern threat landscape, combined with the imposition of strict governmental policies, severely out dates the practice of traditional risk management, rendering it entirely ineffective.
Instead of focusing exclusively on financial losses, businesses should also focus on the other aspects of risk management, particularly, the reputational damage done in the aftermath of a business failing to identify risk factors. Quite contrary to the practices followed in the past, businesses can no longer buy their way out of securing their companies, and need to take the necessary steps towards effective ERM.
How Can Organizations Create An Effective ERM Policy?
Once organizations realize the potential that ERM has to steer forth their company into secure territory, they still need to formulate an effective Enterprise Risk Management policy. Perhaps the most important step that businesses can take is to clearly describe the goals that they hope to accomplish with the ERM.
While formulating a robust and effective Enterprise Risk Management strategy, organizations should also take into account the following things:
- As we’ve already mentioned above, one of the most influential steps that companies can take is to clearly define the scope of their ERM implementation. While formulating a framework, ensure that you’ve covered all aspects of cybersecurity, along with prioritizing certain threats and vulnerabilities over others. All in all, try to create a framework that caters to an arsenal of diverse risk factors and triggers.
- As is the case with the successful amalgamation of any new policy, policy makers and the security staff of an organization should use clear language and foster as much effective communication as possible. Since the effective implementation of ERM depends on every employee, the IT staff needs to be clear cut in their language use and communicate clearly.
- While formulating an ERM framework, organizations can specify their needs into the mix. Although, creating a framework from scratch is usually what most companies prefer, it is often times quite redundant. Depending on the industry that your organization belongs to, there might be a pre-existing framework that would work just as well.
- Ensure that your organization has specifically assigned owners to each category, which will ensure that the goals of each category are met.
- After you’ve successfully created your ERM policy, you can tell the scope of its success by measuring through Key Performance Indicators, which seeks answers to some of the more fundamental questions about your ERM. Typically, these questions include what the organization hopes to achieve, and the specifics of the roles assigned to each employee, etc.
In conclusion
At the end of the article, we can only hope that we’ve done our part by aiding our readers in the effective implementation of Enterprise Risk Management within their organizations. Not only does ERM help secure an organization, it also allows companies a window of opportunity to seek out other ventures.
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