Today, data breaches have become a significant threat to businesses across the globe. Therefore, considering the long list of resultant consequences to be faced as aftermath, it is crucial for companies to come out the other side of a breach intact.
The Annual Cybercrime Report 2019 by Cybersecurity Ventures says that these data breaches can cost global businesses around $6 trillion in 2021!
According to experts, implementing business resilience best practices can help companies overcome issues that come with a data breach.
So, what is business resiliency? Why is it important for companies? How to implement business resiliency practices during a data breach?
What are the Business Impacts of a Data Breach
During a data breach, companies’ confidential data are accessed by attackers without permission. It is not only about sensitive information going out to the wrong hands. These cyber attackers can also hack your database and conduct malicious activities, costing you both money and reputation.
As per Cost of a Data Breach Report 2020 by IBM, the global average total cost of a data breach in 2020 was $3.86M. If this situation continues, by 2021, a business is expected to fall victim to a ransomware attack every 11 seconds.
Now let’s consider some of the negative impacts of data breaches that make companies susceptible to financial and credibility loss.
Finance and revenue loss
If your company operates in regions with data protection legislation, you must pay implied legal fees, regulatory fines, and security expenses in case of a data breach. It can cost you a lot if it is a non-compliant company. All these expenses come in addition to the financial damage you have faced because of revenue loss.
According to 71% of CMOs, the most consequential cost of a company’s security data breach incident is the loss of its brand value. This could affect the company’s reliability, thus having to struggle to find the best candidates, investors, and customers.
Consumer trust, retention, and turnover
Seven out of ten consumers believe it is a company’s responsibility to secure their personal information. So, when there is a data breach, and the consumer’s personal data is hacked, they will quickly lose trust in the business. This can result in losing the most loyal customers, even affecting customer turnover. It could worsen if the company is not ready to accept the responsibility for data breaches.
That’s why today, businesses are more focused on building a better security culture. According to Gartner forecasts, global spending on cybersecurity is expected to reach $133.7 billion by 2022.
But, how effectively companies can deal with data breaches, especially in a hyper-connected world?
To handle a data breach incident and the resulting loss of revenue and trust, every company should have an incident response plan with effective threat modeling. That’s where the idea of business reliance comes into the picture.
What is Business Resiliency
Business resilience can be defined as a business’ ability to quickly adapt and respond to impending risks or disruptions. More like a combination of crisis management and business continuity strategies post-disaster.
Why is Business Resiliency Important for an Organization
Business resilience has become an essential part of the business. Why? Because it saves businesses with its potential for higher recovery.
Consider the unforeseen disasters, shifting market demands, and changing regulatory terms in today’s business world. In addition to these, there will be IT disruptions, sudden competitive movements, security threats like data breaches, etc. too. In order to survive all these unpredictable disruptions, businesses should achieve resilience at all means.
For example, take a look at how businesses worldwide were affected by the COVID-19 pandemic. Only those organizations with agile business resilience planning were able to adapt and survive the COVID-19 challenges successfully. By adapting quickly to shifting business priorities, they are ready for the ‘new normal' in the business battlefield.
On the other side, business resilience best practices will assure that all your business activities comply with the latest industry standards and regulations. This will, in turn, improve your reliability, brand value, and reputation, especially in front of your stakeholders and customers. The resilience plans will also act as a blueprint of all your operations, giving you a head start.
This can even cultivate a resilient organizational culture. It makes the whole business, including employees, quickly adapt to unforeseen challenges whenever the business operations or processes go awry. Or under threat like a data breach.
Originally published at LoginRadius