Despite evolving security tools, data breaches are still common. While many breaches are handled quietly and are only announced to relevant customers, others become international headlines. Because breaches are now larger and more sophisticated, they are also more expensive. A single breach can cost a company upwards of $100 million dollars. Therefore, it is important to evaluate the true cost of a data breach and make investments to prevent one.
There are multiple facets to the cost of a data breach, and many of them aren’t obvious. By understanding where the costs come from, businesses can be better prepared to prevent or handle a breach.
- Public Relations: In a media-driven world, one of the biggest costs surrounding a data breach is the public relations fallout that can result from an incident. Expertly navigating a breach requires advisors, well-trained spokespeople, and carefully planned marketing initiatives throughout the entire process. Costs come in the form of the price of these professionals as well as the time required of employees to facilitate interviews and mitigation initiatives.
- Lost Business: One of the more obvious ways in which breaches cost companies money is in the form of lost customer business. Both affected and unaffected customers may take their business elsewhere. Furthermore, a company must offer any affected customers some type of compensation, usually in the form of a complimentary gift or service (for example, free credit monitoring for consumers whose credit card data may have been stolen).
- System Upgrades: Once teams have determined the root cause, the remediation of a threat may require an expensive technical upgrade. An initiative of this scale is costly and may or may not be in the existing IT budget.
Because of the potential cost of a breach, it is wise for organizations to make up-front investments to prevent or quickly mitigate one. There are a number of ways to accomplish this.
- Follow Standards: There are numerous regulatory and industry standards for technical systems. Consumers and businesses can determine which standards are most relevant for protecting data that is of the highest sensitivity in their industry, then adjust planning and development models to incorporate standards for securing that data.
- Employ Experts: Investing in developers and security experts that understand evolving security concerns is one of the best ways to ensure a secure solution. The cost of recruiting and retaining these professionals is high, but it is still relatively small compared to the cost of a breach.
- Update Systems: One of the simplest ways to ensure the security of a system is to update it. It’s also important to install the latest anti-virus software on any endpoint that touches the network.
While no organization can ever guarantee its immunity against a data breach, it can be a helpful exercise to evaluate the costs of a breach as a way to prioritize resource investments. By considering proactive prevention activities in the context of potential costs, providers can have peace of mind regarding their ability to cope with or prevent a breach.
For more expert guidance around data breaches and cloud security, contact eXemplify and learn how we can help organizations deploy and manage secure solutions.