The Pros and Cons of Performing a Risk Assessment

Performing a risk assessment is a crucial element of an organization’s cybersecurity. Not only do they identify risks and vulnerabilities, but they also help organizations prioritize based on business impact. A risk assessment should be an integral part of your organization’s cybersecurity program. The following are the obstacles organizations face when considering a risk assessment and our recommendations for managing these obstacles.

Obstacle 1: Risk Assessments Can Be Difficult to Complete

Many organizations avoid conducting a risk assessment because they feel it is time-consuming and complicated to perform. However, there are several different types of risk assessments that can be performed depending on an organization’s needs, including quantitative or qualitative assessments.

Once an organization has decided what type of assessment will work best for them, they must develop a plan. Organizations should consider:

  • Who will participate in the assessment
  • Which business units will be affected by the assessment
  • What are the objectives of the risk assessment

When proper planning is performed prior to a risk assessment, the actual assessment can be conducted relatively quickly.

Obstacle 2: Risk Assessments Can Be Expensive

To offset cost inefficiencies, we recommend hiring a consultant to lead the assessment process and reduce the number of hours your employees are away from their daily workloads. The cost of a risk assessment can range from a few hundred dollars to thousands of dollars.

Depending on your industry, compliance guidelines, and other factors, your organization might conduct a risk assessment more frequently than once per year. If you cannot identify security gaps at the end of an annual risk assessment, it is beneficial to wait at least another year before performing the next risk assessment. Our recommendation is to conduct a risk assessment annually.

Risk assessments may be used as proof of due care during a security incident. In our litigious society, a data breach may end in court. Being able to prove your organization is taking risks seriously and showing continued improvement between assessments could be enough to sway a decision in your favor.

Despite the cost of performing an annual risk assessment, most organizations save money as a result of the gaps they are able to find and resolve after the assessment.

Risk assessments are a crucial element of an organization's cybersecurity. Consider the following when conducting a risk assessment.

Benefit 1: Risk Assessments Provide a Roadmap for Your Organization

Your organization’s risk assessment will provide you with a roadmap to inform how your cybersecurity program evolves throughout the year. It will help you prioritize what to focus on first, where to spend the bulk of your time and resources, and how much time you need to devote to new initiatives as they arise.

The goal is to reduce your exposure to a risk or vulnerability so cybersecurity incidents don’t occur in the first place. Unfortunately, you cannot mitigate every possible risk or vulnerability, but your risk assessment can also be used to help you respond more quickly when incidents do occur.

Benefit 2: Risk Assessments Can Be Used as a Competitive Advantage

A risk assessment can be used to gain a competitive advantage over your competitors. With the right information, you can understand your exposure to threats and how to prepare for these threats were they to occur.

An organization’s risk assessment will minimize existing vulnerabilities with proper training programs and security awareness education for everyone in your organization. Include both employees and third-party partners who have access to sensitive or regulated data in your training. We recommend:

  • Requiring two-factor authentication for administrators
  • Monitoring user activity
  • Securing workstations throughout the office
  • Using tools like endpoint data encryption

Another area where you can use your risk assessment to your competitive advantage is in client proposals. Explaining the elements of your organization’s risk assessment process communicates your organization is actively working to secure customer confidential data.

Benefit 3: Your Risk Assessment May Help You Negotiate Better Insurance Costs

We recommend talking to your insurance agent about your risk assessment activities. Some policies and carriers offer discounts if you prove you are actively improving your risk profile. After all, insurance is the transfer of risk. If there is less risk to transfer, then you may be able to reduce your insurance cost.

Risk assessments may feel as though they are more work than they are worth. Although the assessment can feel like a tedious process, you will find it is an important part of your team’s activities. In addition, your customers will appreciate your efforts in keeping their information safe from harm or theft.

The Anderson ZurMuehlen Technology Solutions and Cybersecurity teams are proud to be a resource to you. If you have any questions regarding the benefits of a risk assessment or would like information on conducting your assessment, please reach out to our team.

This article was written by Jason Schaller, Director of Security Services in our Helena office.

The Pros and Cons of Performing a Risk Assessment

The Pros and Cons of Performing a Risk Assessment

Performing a risk assessment is a crucial element of an organization’s cybersecurity. Not only do they identify risks and vulnerabilities, but they […]

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