Every organization around the world is facing the increasing challenge of managing cyber risks as a deluge of threats come from advanced and inexperienced attackers alike. As attacks have increased, both cybersecurity budgets and board-level scrutiny on cybersecurity as a business risk have followed suit. This attention on cybersecurity highlights the challenges of CISOs, who must present abstract cyber risks as something more concrete for business leaders. Cyber risk quantification (CRQ) helps you accomplish that by calculating your organization’s risk exposure in monetary terms and applying that information to make decisions about managing risk in a business context.
“The CISO role must evolve from being the ‘de facto’ accountable person for treating cyber risks, to being responsible for ensuring business leaders have the capabilities and knowledge required to make informed, high-quality information risk decisions.” – Sam Olyaei, research director at Gartner
Security and risk management (SRM) leaders can use cyber risk quantification models and tools to help them better communicate risk, help boards of directors and executive teams make cybersecurity decisions, and prioritize cybersecurity risks based on impact to the business. The following are six things CISOs can gain from cyber risk quantification to help them align security needs with business needs.
1. Better Understanding of Cyber Risk
Faced with rising threats, an ongoing shortage of cybersecurity professionals, and increased attention on the business impacts of cyberattacks, CISOs must prioritize the various risks facing their organizations. Cyber risk quantification models and tools help them understand what threats exist as well as what data and business assets are at risk.
2. Visibility into Attack Routes
While all vulnerabilities may present some degree of risk, malicious actors may be able to plan attack routes to important business assets by exploiting just a few of them. Other gaps may seem significant, but if they do not present a serious threat to your vital business assets, you do not need to prioritize them. Advanced cyber risk quantification tools help you make those decisions by centralizing cyber risk data, so you have visibility into risks across the organization rather than trying to piece together different reports from a variety of tools. This centralized view is critical to helping you quantify your risk.
3. Cyber Risk in Monetary Terms
Once you know which business and data assets are at risk, you need to understand whether they present any real risk at all. All risks are not created equal. Part of the quantification process is understanding each probable threat and figuring out the likelihood of occurrence. What costs might your organization incur in a data breach? What are your most critical or expensive assets, and which ones are at highest risk?
Putting that cyber risk into concrete monetary terms can help you calculate the value of your assets in real business terms and prioritize mitigation based on both the cost of a breach and the cost to reduce threats. That information also helps you decide how much to spend on security tools and where those tools will have the greatest impact in financial terms. The identification of threats and assets is an ongoing process, not something that you can do once and move on. The evolving nature of risk and your changing environment means that you need to focus on relative risks and how to mitigate them.
4. Prioritized Risk Mitigation
Adding the financial context for identified risks is essential if you want your security team to prioritize which gaps to address first. If a threat materialized as an attack, what would be the potential damage to the business? A few examples of the potential damages and cost to the business include:
- What is the cost of shutting down a shopping website or an assembly line for a few hours, days, or more?
- What if employees are idle due to a network outage?
- Is there an additional cost to perform tasks manually instead of digitally in case of an outage?
- Are there any third-party costs, such as legal fees or costs associated with data breach reporting?
Costs are not limited to the possible cost of the cyber incident itself but also to the cost of remediation – and some of those costs relate to loss of reputation and trust by your customers and partners. Once you understand the potential business impact, how exploitable the threat is, and what it will cost to mitigate the risk, you have the information you need to decide which risks are the most critical for you to mitigate.
5. Optimized Cybersecurity Investments
You can make better budget decisions based on the real dollars at risk in the event of a breach to your critical assets. According to Gartner, organizations will spend $188.3 billion on information security and risk management products and services this year, and Gartner expects that spend to increase to $262 billion in 2026. While funding may be growing, there are many attack vectors and scores of security tools and services available, so choosing how to spend cybersecurity dollars can be difficult without the context supplied by a robust cyber risk quantification model or tool.
CRQ helps you focus on making choices based on the real risks that you need to mitigate. When you bring budget requests to the executive team backed by real numbers rather than vague threats due to malware, distributed denial of service attacks, and ransomware, it will help you get the spending approval you need and use it effectively.
6. Better Communication with Your Executive Team
Increasingly, the US, the EU, the UK, and many other countries are passing, enforcing, and updating regulations on reporting cyberattacks, as well as regulations on disclosing breaches, cyber policies, and risk management models. These changes require boards and executives to understand cybersecurity and related risks to the business.
Adopting the right cyber risk quantification model can help you ensure that decision makers fully understand the potential financial and business ramifications of different cyberattack scenarios and approve budget to implement cybersecurity solutions effectively and efficiently.
Cyber Risk Quantification Drives Business Decisions
Understanding the full implications of attacks and costs can help your security team focus efforts and budgets where they will make the biggest impact and transform security into a business enabler instead of a blocker. Cyber risk quantification can help you effectively reduce cyber risk, backed by an executive team whose members understand that cybersecurity spending, done right, is an investment in the business as a whole.
Want to learn more about how CISOs can adapt to their changing role? Read our ebook.