While internet security may not be a top priority when starting a business, ignoring potential risks can be disastrous. One of the mistakes executives and managers make is assuming their company is less vulnerable to cyberattacks than larger corporations. Small businesses, on the other hand, have an equal probability of becoming victims of cybercrime. The most frequent cause for this is that SMEs may lack the resources that larger corporations do. This leaves them more susceptible to cyberattacks and less likely to survive a successful attack. Sencode looks at cybercrime‘s impact on business.
So, in what ways does cybercrime negatively impact business? Companies frequently face indirect costs because of cyberattacks. Like the potential of a significant interruption in operational processes, for example, which can result in revenue loss. Cybercriminals can stifle a company’s normal operations in a variety of ways. Infecting computer networks with malware or installing malicious code on a server that prevents access to your website.
So-called “hacktivists” often breach the information systems of state agencies or global companies in the name of whistle blowing. In 2010, for example, Wikileaks supporters fought back against credit card giants Mastercard and Visa. By launching cyberattacks that temporarily brought their websites down, they caused huge disruption to their organisations.
Loss of Revenue
One of the worst ways cybercrime impacts business is a sudden decline in sales as wary clients seek safety with competitors. Companies can potentially lose money as a result of hackers attempting to extort money from their victims.
As it prepared to release “The Interview,” a comedy depicting a failed assassination attempt on North Korean leader Kim Jong Un, Sony Pictures was targeted. Hackers gained access to the company’s sensitive data, including embarrassing e-mails and staff performance reviews.
Impact on Costs
Dealing with the consequences of cyberattacks after the event is way more costly than implementing proactive protection. Being caught off guard may cost a business in a plethora of ways. Firstly, you will need to seek out and pay for a cyber security professional and security software. It may also be mandatory to notify anyone whose data is part of the breach. Even once the issue is overcome, insurance premiums are likely to increase and inflict more long term financial pain.
Intellectual Property Theft
Product designs, technologies, and go-to-market strategies are frequently among a company’s most valuable assets. According to intellectual property advisory Ocean Tomo, intangible assets accounted for 87 percent of the value of S&P 500 companies in 2015.
Most of this intellectual property is in the cloud, which makes it vulnerable to cyberattacks. Within the last ten years, nearly 30 percent of U.S. companies have admitted having their intellectual property stolen by China.
CD Projekt Red, the game studio behind AAA titles such as ‘Cyberpunk 2077’ and the ‘Witcher’ series received a ransom note from a disgruntled criminal hacker. Their threats to the game developers included making their source code public and refusing to decrypt their valuable work.
Cybercrime‘s impact on business may also affect the reputation of an organisation. Companies who are victims of bigger cyberattacks may suffer severe damage to their brand. This is despite the fact that it is difficult to measure. Customers and even suppliers may be hesitant to trust a company whose IT infrastructure has been in a breach at least once.
When criminals obtained access to the personal information of its customers in 2014, JPMorgan Chase & Co. (JPM) faced a similar smear. Hackers gained access to 76 million personal accounts and seven million small business accounts, gaining access to information such as names, addresses, phone numbers, and email addresses.
Changes to Company Policy
Businesses usually suffer from cybercrime in several ways. To ensure that sensitive data is safe, businesses must reconsider how they gather and keep data. Customers’ financial and personal information, such as credit card numbers, National Insurance numbers, and birth dates, are no longer in many businesses’ possession.
Some businesses have shut down their online stores for fears they will not be able to protect themselves from hackers. Consumers are also more interested in learning how the companies they do business with manage security concerns. They are more willing to favour companies who are open about the security measures they have put in place.
Cybercrime‘s impact on business can be catastrophic for a business of any size. An attack can happen at any time and cause irreparable damage. With just a little forward planning and a small budget, the risk of cybercrime having a negative impact on your business can be greatly reduced. Raising awareness in staff, ensuring operational policy is adequate, and using software and hardware that are reputed to be secure by design, are all ways you can mitigate the impact of cyberattacks, and ensure business continuity.
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