The Equifax data breach led to the exposure of the personally identifiable information of 143 million people. This is just a tip of the iceberg when speaking of the threats that businesses face daily. While the company has managed to remain afloat despite the reputational and financial loss brought about by the breach, it would be tough for small business to rise from such a monumental blow. Sadly, such risks are the norm in the modern-day business world.
From fighting market changes to trying to eliminate the threat that competitors pose, modern day businesses need to be ready to co-exist with these threats. Since risk is ever dynamic, with new dangers arising each day, it only makes sense to try and be steps ahead of these threats.
Here is how to create a business that is threat-ready:
The Value of Data in Risk Management
The data your company collects is quite invaluable in risk management. This can include data obtained from vendors, customers, employees, and even investors. When used correctly, not only can it provide some insights on what risks your business is up against, but it can also portray the best path for eliminating threats. By addressing all the places your data transfers between parties or when it is touched by internal employees you can ensure its safety by accounting for each avenue and scoring the weight of the threat by leveraging a risk assessment matrix.
Ideally, you will need to invest in state-of-the-art data analytics and storage tools. This will help draw quality insights from the data. The tools might include security tools, quality control programs, and even vendor management systems. Ideally, working with this group of tools for data analysis should help improve waste management, customer services, profit margins, and cyber-security.
On the flip side, mission-critical data will also need to be protected. In the wrong hands, such data can not only be used for identity theft but also bring down your business. As such, you should use access control measures and data security tools to reduce the exposure of both production data and intellectual property.
Limit Human Error
Sadly, human error might easily maim your data protection goals, among other risk management strategies. The fact that an employee might access business data using unsecured Wi-Fi networks or even make errors in risk management presentations can lead to the downfall of your business.
Employees need to be aware that the nitty-gritty details of their daily operations have a ripple effect on the entire business’ risk posture. For instance, customer service representatives should know that losing a single customer due to poor communication can lead to losing more customers. The trick is to build a culture of risk management in your organization.
How to Build a Risk-Focused Culture
It will never be enough to create documents on your proposed risk management policies and call it a day. Risk management trickles down to everyone working on their operational activities with risks at the back of their mind. While building a risk-focused culture is the first step towards being ahead of business threats, it isn’t easy.
It calls for business leaders to include risk analysis in their decision-making process. Employees also need to understand the role they play in fighting threats. For instance, employees should be intuitive enough to differentiate phishing emails from regular emails. However, it takes time to build this type of culture.
Risk Management Should Be Organization-Wide
In some cases, there might be a disparity of opinions between the leaders of risk management, and the people who implement the policies. For instance, your business executives might think that a virus is your biggest security threat, whereas the IT team knows that there might be zero-day threats in your system. While the managers might refuse to invest in patch management, this disparity can lead to the IT workforce being resistant to the proposed strategic changes.
Ideally, the risk management decision needs to involve the entire organization. When employees feel that their opinion counts in the risk management process, they will commit to improving the success rate of the strategies. On the flip side, employees will also identify threats that risk manager might never have identified through only brainstorming. In case an issue arises from the decisions made, employees should always feel free to approach the managers.
Be Flexible With Your Plans
Risk landscapes change with time. As a result, focusing on a rigid plan might lower the chances of mitigating risks. Since business boundaries also fade as it grows, your risk treatment plans also need to be scalable enough to adapt to business changes.
Instead of being risk-averse to evade new risks, you should always look to update your risk treatment plans. Something as simple as having board meetings after every two weeks or month to address your current risk management posture might be enough. In case you identify any significant gaps, you can always launch a committee to investigate and address the issue.
Risk management goes beyond crafting detailed policies for treating risks. The entire workforce needs to be on the same page on your decisions. Once everyone understands the role they play in mitigating business threats, it becomes easier to fortify your business against them.