Digital risk is created by the new technologies that a company adopts to help accelerate its digital transformation. Digital risk management refers to how a company assesses, monitors, and treats those risks that arise from digital transformation.
Digital risk management is a critical part of business management. Digital risk management focuses on the threats and risks to an organization’s data and the IT systems that process it.
As organizations embrace digital transformation, their information security teams must keep the business secure while enabling growth and innovation.
How Does Digital Risk Management Work?
All this means that chief information security officers (CISOs) must develop digital risk management strategies that consider these new technologies and provide better decision-making capabilities.
Since digital risk is created by the new technologies a company adopts, a digital risk management program must be unique to that organization. That said, a digital risk management program usually encompasses the risks associated with these technology categories: third-party organizations, mobile, big data, the Internet of Things, cloud computing, and social media.
For example, the risks associated with social media presence, such as phishing and account hacking, can introduce numerous threats to an organization and damage its reputation. If a company’s security team can’t secure the company’s social media accounts (which are its digital communication channels) then customers and potential customers will worry that their personal information is also at risk.
Benefits of Digital Risk Management
Digital risk management is important because without it, you can’t be sure that the technology you use is truly worth it; the new technology might introduce new risks even as you want it to solve old problems. For example, if a new consumer-facing app suddenly crashes for an hour due to cyber attacks or just a simple software error, that could result in poor customer experiences and bad publicity. A misconfigured application might expose personal customer data to attackers, exposing you to regulatory enforcement and civil lawsuits.
By detecting and assessing possible vulnerabilities in a business IT network, companies can best prepare for cyber assaults and strive to mitigate the effect of a cyber event if one occurs. In addition, a digital risk management program’s procedures and rules can guide future decision-making on limiting risk while focusing on corporate goals. Digital risk management also assists you in demonstrating compliance with numerous data security mandates and industry standards, such as the EU’s General Data Protection Regulation (GDPR).
How to Implement Effective Digital Risk Management
Before you start evaluating digital risks, first develop a solid, transparent risk assessment process. Then you can fine-tune that process to fit your company’s legal, regulatory, and contractual needs.
The following are the core activities of digital risk assessment:
- Identify critical assets, such as IT systems, databases, websites, and payment processing systems; and determine their vulnerabilities.
- Understand the threats to the business. Determining how threats behave can help companies tighten the cybersecurity of their systems.
- Check for exposed assets. Companies should identify sources of unwanted online exposure, including social media, file-sharing sites, and Git repositories.
Develop a mitigating strategy to protect against digital risks. This includes:
- Reducing the attack surface by identifying systems that are vulnerable and (as much as possible) removing them.
- Assuring that IT security teams keep threat models updated by considering critical digital assets, including those associated with third-party organizations and supply chains.
- Integrating digital risk management into general incident management processes.
Digital Risk Management With Reciprocity ROAR
Managing digital risk takes time, and it isn’t easy. As such, information security teams must first understand what digital risk is and the types of digital risk that exist, so they can implement the most effective cyber risk management strategies.
With The Reciprocity® ROAR Platform, you obtain the visibility you need to stay ahead of risks and effectively convey the impact of risk on high-priority business activities. This contextual information enables you to prioritize investments and make sound business decisions while improving security.
ROAR has the resources you need to identify, analyze, and manage digital risk properly. Select the correct combination of controls, risks, and threats from a vast, pre-loaded content library to analyze the risk associated with your business process or endeavor. The Risk Operations Center gives you sophisticated dashboards and analytics that go beyond standard heat maps.
The ROAR Platform minimizes complexity, connects teams, and helps you stay ahead of threats by continually monitoring for changes that might negatively influence your risk posture by automatically developing linkages between business assets and processes, controls, and risks.
Schedule a demo to learn more about The Reciprocity ROAR Platform.