Why Is Cybersecurity Important for Small Businesses?
Digital security has become an investment necessity. Cybersecurity one way that businesses protect their company, customers and financial information from any type of cyberattack. These attacks represent an ever-evolving danger to organizations, employees, and consumers, as they are designed to access, destroy and extort sensitive data or money. In some cases, smaller companies are considered easier marks and are targeted more as a result. From direct protection of the company (and potentially anyone involved) to legal consequences, there are many reasons as to why IT security is so important to stay up to date on. Here are five reason cybersecurity is essential for small businesses.
1. Cybersecurity Protects the Company
Most importantly, the businesses themselves are vulnerable and at-risk in the case of a cyberattack. Protection methods like encryption help secure finances, customer information, emails, business strategies, important company documents, and many other major assets commonly targeted by cybercriminals. Without network security, this information can be accessed, made public, or even worse, sold to competitors or on the dark web. These documents are crucial to the success of a company, as well as for keeping an edge on competitors. That being said, losing complete control of these documents can directly harm businesses, and in some cases, be their demise.
While some question the importance of internet security, there are several things to keep in mind:
- According to a study done at the University of Maryland, computers with internet connections were attacked (on average) 2,244 times per day;
- According to Small Business Trends, 43 % of cyberattacks target smaller businesses;
- The same article details that 60 % of small companies lose their business within six months of the cyberattack;
- The same article then goes on to say that only 48 % of breaches stem from malicious intent, while 52 % are caused by human error or system failure.
Cybersecurity is essential in protecting vital company information and ensuring the health, growth, and longevity of businesses.
2. Cybersecurity Prevents Legal Consequences
There are legal ramifications associated with dealing with cyberattacks, aside from the loss of customers and revenue. If there are lackadaisical preventative measures, or in some cases, none whatsoever, the federal government may involve themselves and penalize the business. Naturally, there are computer security laws that regulate organizations, and as with many rules, failure to comply comes with penalties:
- Gramm-Leach-Bliley Act(GLBA) 1999:
- This law mandates standards for how personal/financial information is collected, stored and accessed.
- Violations of this law are subjected to $100,000 for each violation and business directors may be fined up to $10,000 personally and face up to 5 years in prison.
- Health Insurance Portability and Accountability Act(HIPAA) 1996:
- This law mandates how medical information is collected, stored and accessed.
- Violations of this law are largely based on the number of records exposed but can range in fines from $50 to $50,000 per record. The fines are capped per year but can be fined at a maximum rate for multiple years. Violators can face one to ten years of prison time as well.
- Federal Information Security Management Act(FISMA) 2002:
- This law mandates how the economic and national securities of the United States are regulated on a federal level.
- Violations of this law are potentially subject to penalties including formal censure from Congress, as well as reductions to public funding.
All these government regulated punishments aside, there may be additional lawsuits and other repercussions from customers who are affected by a breach.
3. Cybersecurity Maintains the Organization’s Reputation
Consumers place a great deal of trust into the businesses they spend their time and money on. When there is a data breach, in most cases, their information is compromised, and that trust is diminished quickly. Customers prefer to keep their information private, and to communicate in total privacyas well. Major data breaches are not generally kept hush-hush either, so media outlets covering the attacks can severely damage an organization’s reputation.
A company’s reputation is crucial for growth and a lack of focus on cybersecurity (especially when it leads to a breach) can prompt consumers to take their business elsewhere. Aside from the media attention that digital compromises receive, current customers may feel compelled to turn to a competitor due to lack of trust. If the digital attack isn’t taken care of in a timely and efficient way, weak security may always be associated with the company, and ultimately may jeopardize the company’s reputation as a whole.
4. Cybersecurity Saves Money
Cyber breaches can be extremely costly to a company. Aside from the direct backlash of a data breach, many costs such as legal fees, money lost due to downtime, stock price decline, investigator/forensic effort, and any legal action that is taken against the company can be mitigated with adequate security measures.
Overall, it is better to initially invest in cybersecurity as a proactive measure rather than react to an expensive cyber vulnerability. One step past that, while a breach is being cleaned up and taken care of, the focus is taken off of the company and placed on fixing the issue. While the cyber issue is being taken care of, the company’s productivity may lessen or come to a complete halt, which directly decreases profits.
5. Cybersecurity Protects Customers
Customers are at the heart of a company; without them, a company has nobody to sell products or services to. Cybersecurity is meant to protect these people and their information. These attacks are not just directed at the company, but also at the clients. That being said, cyber breaches are just as detrimental to the customer as they are for the organization.
Customers place trust, money, and information into a company when they are involved and a data breach impedes on that trust and information. According to CSO, the International Data Corporation (IDC) predictsthat by 2020, a quarter of the population of the world will be affected by data breaches. With these predictions readily available across the internet, customer concern for protection increases as well, making a company’s cyber protection measures even more crucial.