For many businesses, technology isn’t just a tool they utilise to streamline daily working practices, it’s the entire foundation of their organisation. Making the most of technological advances means businesses don’t just operate on a smarter level, but the absolute fundamentals of their enterprise are in safe hands.
From employee training and efficient customer communications to highly effective marketing strategies and the ability to develop new and innovative approaches, the bond between business and technology accentuates commercial success and profitability. But is everything as rosy as it seems? Scratch beneath the surface and you’ll find that this seemingly harmonious relationship is anything but perfect.
It appears that the growth and our subsequent reliance on technology within business comes at a price. The working relationship between commerce and technology is a double-edged sword, as with aggressively implementing new technologies comes a variety of digital transformation risks. And businesses of all sizes are inadvertently exposing themselves to more digital risks than ever before.
As a business hoping to maintain a positive relationship with technology in the hope of driving more growth, it’s important that your organisation quickly identifies and manages these digital risks before your profitability is interrupted. And this is where digital risk management comes in. Digital risk management has to be included in your due diligence for digital assets.
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What is Digital Risk Management?
Digital risk management is the implementation of specific processes designed to monitor digital risk channels effectively and ensure that your enterprise is risk-ready, not just for today but for the future. The adoption of these new processes or technologies means you’re taking the steps necessary to reduce digital risk within your enterprise. And as these risks can impact everything from your financial growth to your operations and even your business reputation, it’s vital that you’re committed to a regular digital risk assessment and that this process is carefully managed within your organisation.
What Types of Digital Risks Are Businesses Facing?
When scrutinizing these business dangers, we must recognise the different classifications of digital risk that may be highlighted during a digital risk assessment. It’s worth noting, that all industries from financial and business services to manufacturing and retail are all exposed to some or all of these digital risks. Let’s explore some of these here.
Cyber Security Risks
Regrettably, all businesses with an online presence are exposed to multiple cybersecurity risks. Essentially, hackers and cybercriminals are looking for valuable information and sensitive data that they can use for their own means and benefit. If a cybersecurity risk were to be identified in a digital risk assessment, then your enterprise is at risk of a serious security breach. Something which could not only impact the everyday operations of your business but also permanently damage your reputation.
Compliance Risk
Every business must uphold the laws, regulations and organisational standards expected of them within their chosen industry. To maintain compliance across all these factors, businesses must adhere to all the relevant governing requirements to avert compliance risks within employee behaviour, health and safety, data management and others areas. When businesses are keen to implement new technologies, they could be at risk of failing to comply with these regulatory standards, endangering their reputation and conformity with significant digital transformation risks.
Automation Risk
The introduction of automated practices within daily operations gives businesses the chance to streamline entire departments, or multiple tasks within one role, freeing up more time to focus on other areas and in turn, benefit from economic growth. When identified within digital risk management, automation risk has the potential to create issues with obsolete technology and social disruptions within your business.
Workforce Risk
High employee turnover, skill shortages, employee safety and other issues could all pose a risk to your business growth once digital technologies take hold of your business. A digital risk assessment will highlight these potential problems and give you the insight you need to evaluate and monitor these damaging scenarios.
Third-Party Risk
As businesses begin to grow, their dependence on technology isn’t the only area they need to manage risk. Relying on third parties to complete outsourced tasks such as digital marketing, software development or even accounting and HR services could leave your business vulnerable to sensitive data breaches including employee and customer data, financial accounts and the daily operations of your enterprise.
How Is The Severity of These Risks Assessed?
Now that we recognise and understand the potential digital risks of running a business operation, we must acknowledge the gravity of these risks and turn our attention to assessing their severity. By performing a digital risk assessment and using the results to uphold stringent digital risk management practices, your organisation won’t only survive within a digitised world, it will also have the opportunity to thrive.
Understanding your day-to-day operations and breaking down your business into areas associated with digital risk e.g., third party, cybersecurity, compliance, financial etc, will pinpoint the individual weaknesses of each department giving you the information you need to participate in effective digital risk management solutions. Performing an assessment will highlight the potential impact of these risks on your reputation, your growth and operations, allowing you to determine which of the most severe risks need to be dealt with cautiously and promptly.
Digital Risk Management Solutions
Managing your digital risk means preparing your business for the future and protecting your growth. Developing digital risk strategies will help you stay one step ahead and ensure that your most valuable assets are protected.
Centring your digital management efforts around your business’s most crucial and fundamental operations and participating in an internal audit is a good place to start. Let’s examine some additional digital risk management solutions here.
Implement a GRC Solution
The implementation of a GRC strategy (governance, risk and compliance) is a simple yet effective way to manage the complicity of your business. Investing in a GRC software solution is a positive step towards digital risk management, as businesses can meet all their business objectives whilst consistently measuring how well they are performing within governance, risk and compliance obligations.
Be Wary Of Unwanted Exposure
When your precious business assets such as your customer data, financial information, employee data and business operations are vulnerable, it’s important that you’re monitoring other sources where your business assets could be receiving unwanted exposure as part of your digital risk management solutions.Consider the following sources:
- File sharing sites
- Dark web pages
- Criminal Forums
- Paste sites
- Git repositories
- Social media
Consider a Tactical Approach
Blocking actions such as firewalls, email security, behavioural analytics, anti-malware and data loss prevention allow businesses to place physical barriers around their network to significantly decrease the threat of digital risks.
You could also identify the weak points within your system by taking on a White Hat Hacker approach and having them test the security capabilities of your digitised business.
Consider an Operational Approach
Implementing domain monitoring to ensure your brand and your trademark rights are protected. It’s a simple yet highly effective way to reduce digital risk and maintain a stringent management strategy.
If your business experiences a digital incident, investigate the risk, review your initial approach and contain and manage the risk effectively. This approach will improve your understanding of the risk and ensure you’re developing a well-informed and up-to-date strategy.
Consider a Strategic Approach
Digital risk management should be approached strategically, therefore ensure that digital risk assessment is an integral part of your operations. This tactic gives you a better understanding of the areas of your business that are most at risk, giving you a clearer digital picture and the opportunity to act quickly.
In Conclusion
Now that you’re more familiar with the threat of digital risk, you’ll now be able to develop your own digital risk management strategy and implement it with confidence.