Introduction
Security is a major concern for all companies. Whether it is physical or financial, most companies invest heavily in securing their offices, buildings, and staff against all kinds of threats. Physically, security staff, along with fences, CCTV cameras, and identity cards, are the primary protection against outsiders. Insurance for staff and the business is an example of financial security. Legal contracts that are written according to the legal aspects and signed by businesses are a form of security in business-to-business endeavours. However, the modern world has created a new virtual world on the internet that also needs security from external forces. Cybercrimes have become common and a major threat to management and businesses. Virtually no company is free from the looming threat of cybercrime. As a result, cybersecurity is increasingly in demand. The future holds cybersecurity as a critical security aspect. In this article, we will discuss the need for cybersecurity for businesses and how management can help minimise this modern threat.
Increasing Cybercrime, technology usage, and IoT
The modern digital world is ever-increasing in its reach. The evolution of smartphones and mobile networks as providers and users of the internet has created limitless opportunities in the internet world. Mobile apps have become a mainstream business platform for developers and IT companies. Another branch of technology that is dependent on the internet is the IoT (Internet of Things). This technology has also become mainstream and is being used as a backbone for smart homes, smart agriculture, and even smart cities.
All these technologies need to collect, propagate, and store information. Part of this information consists of private and critical information about individuals, companies, and governments. As these must be guarded against prying eyes, several additional technological solutions like encryption, firewalls, and antivirus are used. Even then, data is not deemed safe on the internet because of cybercriminals and cyberwarfare. On average, cybercrimes are costing organisations US $4.24 million, as per a 2021 report by IBM. It is also estimated that these crimes will cost $10.5 trillion a year by 2025 (Source: Cybersecurity Ventures).
Information is the new oil.
For the most part, businesses are dependent on the internet nowadays. The popularity of social media has created a new world where marketing has acquired new dimensions. With real-time analytics and innumerable marketing tools, the internet is a place where brands are built, customers are brought, and profits are made. The booming e-commerce industry has attracted millions of small businesses to the internet and created thousands of start-ups that are dependent on this technology. As a result, there is an enormous amount of critical and personal data on the internet. It includes personal information like birth dates and genders, social security numbers, and credit card numbers. On the management scale, the company's intellectual properties, software, employee databases, and critical business-related data are moved online or stored on computers.
All this data has immense value for outsiders like competitors, malicious hackers, foreign governments and intelligence agencies, terrorist organizations, and others. This information can be used for malicious intentions like an infiltration, impersonation, and many more security-related intentions. There is an ever-increasing demand for private and vulnerable data on the internet by these organisations. Independent nefarious hackers earn money by exploiting the system vulnerabilities of governmental and non-governmental organisations, corporations, and small businesses' data and selling the information to these organisations to earn or win hefty sums of money.
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Here are some ways cybercrimes affect businesses and management.
Insider information leaks and loss of competitive edge
Insider information can be used to a competitor's advantage. Critical company data like copyrighted content, software databases, and source codes can be hacked by insider employees. Often, this data gets leaked due to the lack of accountability on the part of management. For example, not changing the email and password credentials of former employees can lead to a compromise of the company's security as this can be used by the employees.
According to Verizon,1 in 4 data breaches are caused by insiders. Insider threats have several underlying causes. Ignorance is the major reason for data breaches or cyberattacks. As hackers can cleverly impersonate company employees online through authentic credentials, innocent employees get trialled. The victims of social engineering are, for the most part, responsible for the data breaches. There are also other intentions, like greed, revenge against the former company, and malice against colleagues. In such cases, employees are driven by emotions and victimise the company by gaining access to the company's digital assets.
Ransomware and additional costs
Source: Michael Geiger Unsplash
Ransomware is a type of malicious software that gets into a computer and encrypts all the native documents and data. The only way to decrypt the computer and access the data is by entering a password. However, only the cyber attacker holds this password and the company needs to pay the hacker money, often in cryptocurrencies, to get the password. This can threaten the existence of the business if the affected computer or computers hold critical data needed for daily operations. For example, if an e-commerce store's product order data is subject to ransomware attacks, the shop will not be able to open the computer and access the delivery address of customers and the items that they have ordered. This can lead to the shutdown of the business and possible lawsuits. Backing up the data in several places regularly can help to some extent.
According to a survey, 71% of these ransomware attacks are targeted at small businesses (Source: Health IT Security). The reason for this is the lack of cybersecurity tools, methods, and awareness in small businesses. Often, they have a limited operational budget and thus increase their exposure to cyberattacks.
DDoS and operational disruptions
Cyberattacks can also severely disrupt the operational capacity of a business in many ways. For example, there have been multiple DDoS (Distributed Denial of Service) attacks on companies like AWS (Amazon Web Services) and Cloudflare in the recent past. As a massive network of websites was dependent on these websites for their operations, these attacks severely disrupted those businesses directly and indirectly (Source: A10 Networks). Such attacks are targeted not only at IT giants like these but also at small businesses as well. Small e-commerce stores and business websites will incur profit losses amidst such operational disruptions.
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Data breaches can result in legal charges and hefty fines.
Source: Tingey Injury Law Firm Unsplash
Heavy fines for IT companies by legal bodies have become the norm for a time (Source: Tessian). The European Union's GDPR is considered one of the toughest data security laws in the world. Following the increase in concerns for data privacy on the internet, many other countries have passed laws that regulate the collection, storage, and usage of personal data. In many countries, websites are required to clearly state the data they are collecting, the intentions of collection, how they will use the data, and if they are using third-party software for any of these purposes before customers choose to continue. App stores have implemented rules that require app builders to state these. However, all these are easy for IT giants and large corporations. Small businesses struggle with the implementation of these legal aspects. In massive data breaches, small businesses incur immense losses in fines.
Reputation Loss and the swaying of customer trust and loyalty
In a study by Comparitech, after a data breach, the share value of 34 companies fell by 3.5% on average in both New York Stock Exchange and Nasdaq. Companies and businesses are built on mutual trust between customers and the company. When customers give their personal and financial information on the internet, they require the companies to safeguard that information by all means necessary. When a company becomes a victim of cyberattacks and data breaches, or if it is found selling the data to a third party, the customer trust gets shattered. In the age of social media, this can spread like wildfire and severely damage the reputation of a company across the globe. This can hinder the growth of the company as the trust that was lost can never be recovered.
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Adware and productivity loss.
Adware is a type of less dangerous malicious software that is widely found on the internet. Over 48% of all malware are adware programs (Source: Kaspersky). The task of the program is to lead unsuspecting website surfers through a chain of advertisements or advertising websites so that the attacker can earn money through PPC or get possible conversions through the ads. However, this can also lead visitors to other malicious websites and increase their exposure to further detrimental cyber risks. Through the malware, attackers can bait visitors to click a link and steal critical information. This can also be used to lead them to ransomware sites and complicate cybersecurity.
In work environments without web surfing filters, antivirus software, and necessary firewalls, the adware can quickly gain control over an employee's computer. This can compromise the cybersecurity of the whole network and the company. Moreover, malicious adware can lead employees astray on the internet and cause productivity loss for the company. With the advent of artificial intelligence recommendation systems, adware is getting smarter every day and learning how to lure employees by showing relevant ads. In a work environment, this can affect employee productivity.
Cyberwarfare and internal security.
Finally, cybercrime is not only a concern for management because of individual hackers but also because of the new kind of warfare that knows no boundaries. Cyber warfare is becoming common in all the recent international conflicts. Specialised cyberwarfare wings of government agencies are targeting the information systems of other nations during wars and internal power struggles. These are used to mine vulnerable information with which they can control the events of wars or elections. A swarm of fake accounts are used on social media sites to alter the beliefs of the general population. These accounts post public comments or posts on social media to sow discord and incite hatred. Russia's social media interference in the US presidential elections 2016 and China's infiltration of Indian and Taiwanese websites are some examples of the threat of cyberwarfare (Source: First Post).
These can be a major threat to public administrators and managers of governmental bodies. In the case of Bharat Biotech, a vaccine development company, China's cyberattacks compromised the company's internal data security (Source: Reuters). In these cases, not only does the company need to fear for its data safety but also countless others' safety. These data breaches can topple internal security systems and cause chaos in critical situations. Leaking data like undercover military personnel, military satellite orbits, and the location of key leaders for simultaneous assaults can have detrimental effects on the survival of a nation. Such information can be tactically used to win wars or cause public discord. Public administrators also find it hard to fight against outside forces that spread misinformation and incite propaganda through social media during key power transmission events like elections. This causes prime to lose trust in their institutions and resort to violent protests.
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Conclusion
Management systems are undergoing a massive transformation in this digital era. As the dependency on the inherent increases, the exposure to cyberattacks also increases. Because most modern businesses cannot compete without the internet, computers, and data, it appears that defending the digital environment is the only option. And it must be noted that no business is free from the threat of cyberattacks on the internet. Hence, collecting valuable information, propagating it, and storing it in the cloud or native databases must be properly protected with digital and physical security. Server rooms must be properly protected within secure premises away from infiltrators. Creating awareness in the workforce helps thwart most cyberattacks.
By taking proper protective measures, companies can not only protect their reputation and customer loyalty but also avoid legal charges and hefty fines. Moreover, it can safeguard itself from most mainstream cyberattacks like DDoS, phishing, and data breaches. Thus, companies can easily maintain their operational standards without any disruptions. Only management can integrate this much-needed protection into their management systems.
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