Technology continues its pace of lightning fast evolvement – and whilst security systems, tools and techniques continue to become ever more advance, so too do the tactics and tools of the IT criminal underworld. To underline and startlingly emphasise this point, we look to the latest UK Government’s report into business security breaches – which found that 74% of SMEs reported a breach in the last year alone (pwc). Sobering figures indeed.
Businesses must be aware and stay continually up-to-date with the very real risks of a cyber breach. This blog article should serve as a firm starting foundation for understanding exactly what outcomes are experienced, when a company’s IT systems are penetrated.
Trade that comes to a screeching halt
An IT security breach is capable of immediately ceasing almost all business activity – creating backlogs, dissatisfied customers and stressed employees. Whilst the financial cost of this downtime will vary from company to company, when we look to Fortune 1000 companies, the cost of unplanned application downtime is palpable – totalling to between $1.25 and $2.5 billion; these figures represent an average hourly cost of $100,000 per hour (IDC).
Lost goodwill – irreplaceable. Bad publicity – potentially never ending
Beyond the dead set financial costs, lies something at risk that is truly priceless – the goodwill of your customers (as well as those who were yet to become customers). We need only look to the IT security breaches in recent time of Yahoo!, Carphone Warehouse and Hilton Worldwide to truly gain a picture of the impact of a cyber-attack.
Yahoo! who’ve continually lost market share in the last decade, fell victim to a hack that exposed the details of 500 million user accounts. This would have been serious enough, however the situation was compounded by an 18 month delay in investigating; the result of which has put buy-out negotiations with Verizon Communications on a knife edge. What’s more, a recent survey highlights just how unpopular this news will be with Yahoo! users themselves, as 90% of people say that they expect to be informed of a breach within 24 hours (FireEye).
Carphone Warehouse are facing potentially years of investigations by the UK data watchdog for the interception of 90,000 customers’ credit card details – something that will repeatedly impact upon the company’s image with each news update on the case. Finally, whilst Hilton Worldwide’s POS infiltration may not have impacted the brand’s share price, the headache of bolstering their security, and offering all affected customers free credit report services, has represented nothing short of an administrative nightmare.
The bad publicity that came about as a result of these breaches is, to this day, impacting upon each of these company’s profit margins. Estimating when, or indeed if, such a loss of confidence will ever subside is impossible.
Lost trust and lost custom – A bird in the hand…
Whilst steps can be taken to rebuild brand image and win over new customers who may have abandoned a company post-breach, winning new customers is considerably more time-consuming that servicing current ones. What’s more, this issue is becoming all the more serious, with more customers today switching to competitors once a breach is revealed. As testament to this, over 2013-14, IT security breaches resulted in 15% more lost customers, than in the year previous (Digicert).
The threat of further attacks
When the news of a successful IT breach breaks, the prospect of that company becoming a target for more cyber criminals is almost unavoidable. This places pressure on a company to react quickly with bolstered security. Unfortunately depending on the IT system in question, this can be a logistical nightmare at best, and technically impossible at worst.
We help businesses of all shapes and sizes in protecting their vital IT assets. For a consultation with our team as to how we can help protect you from a cyber breach, simply get in touch for a free, no-obligation conversation. Alternatively, our free downloadable guide offers more insight into avoiding (and surviving) a cyber-attack.