This is part 3 of 9 in the Getting More Out of Your Security Budget Series
Historically, penetration testing has been seen as a technical requirement that only IT departments need to be worried about. However, with the increased connectivity of applications and the expansion of attack surfaces, penetration testing and overall cybersecurity health has never been more crucial for organizations. Ignoring the catastrophic potential damages that data breaches can inflict, not only on the organization but also on its customers and vendors, can result in negative reputational, financial and legal impacts if the company survives. Many organizations do not survive the aftermath of data breaches, in fact, 60 percent of small companies go out of business within six months of falling victim to a data breach or cyber attack.The damage that a data breach can cause is not limited to just the IT department, it affects the whole organization. The negative impacts of data breaches directly affect business operations and decisions. These effects have prompted business decision makers to be more involved in the overall security strategy of their organization.
There are 4 main reasons that drove decision makers to become more involved in cybersecurity
As the cyber landscape continues to evolve and merge into business consequences, it is clear that organizations’ decision makers cannot afford to overlook the importance of penetration testing and cybersecurity health.
One of the most common reasons why penetration testing is shifting to a business requirement more than a technical requirement is due to regulatory compliance standards. Many industries, such as healthcare and finance, have to adhere to strict regulations and laws regarding data privacy and security. Regulatory bodies such as Health Insurance Portability and Accountability Act (HIPAA) and Payment Card Industry Data Security Standard (PCI DSS), require organizations to conduct annual or semi annual penetration tests to identify and address any potential security vulnerabilities.
HIPAA requires healthcare organizations to protect patients' confidential medical information. Any breach of this data can result in serious penalties, such as fines and legal action. IBM’s annual “Cost of a Data Breach” report showed that the average cost of a healthcare data breach is now $10.1 million per incident, signifying a 9.4 percent increase from its 2021 report. To comply with HIPAA regulations, healthcare organizations must conduct quarterly penetration testing to identify and address any security vulnerabilities in their systems.
Similarly, PCI DSS requires businesses that handle credit card information to meet strict security standards. This includes quarterly penetration testing to identify any vulnerabilities that could result in a data breach.
Other regulations such as GDPR (General Data Protection Regulation) in the European Union require organizations to protect sensitive data and maintain adequate security measures. Compliance with these regulations often requires annual or semi annual penetration testing to identify and address any potential security vulnerabilities.
In 2017, Equifax suffered a massive data breach that compromised the personal information of over 143 million people. Equifax was fined $575 million by the US Federal Trade Commission (FTC) for failing to maintain adequate security measures, including quarterly penetration testing. The breach also caused significant reputational damage to the company, leading to a decline in its stock value and a large loss of customers.
Organizations that fail to comply with regulations face severe penalties, including fines and legal action. Organizations will also face reputational and customer damages. Customer’s need to trust their organizations, and if the organization betrays that trust this will directly impact their business performance. By conducting quarterly penetration testing and fulfilling compliance requirements, businesses can identify and address potential security vulnerabilities and demonstrate their commitment to data privacy and security to their customers.
Penetration testing helps organizations identify vulnerabilities in their systems before they can be exploited by attackers. By conducting quarterly penetration testing, organizations can evaluate their security measures and identify weaknesses that need to be addressed. This allows businesses to take proactive steps to mitigate risks and prevent potential data breaches.
Conducting quarterly penetration testing can help businesses stay ahead of the curve in terms of emerging threats. Manual penetration testers can simulate various attack scenarios and identify weaknesses that could be exploited by attackers, using very similar thought processes as hackers. This information can then be used to inform security strategies and implement appropriate measures to address the vulnerabilities.
The benefits of penetration testing go beyond simply identifying vulnerabilities. Penetration testing allows organizations to prioritize security investments and allocate resources effectively to reduce the risk of successful attacks.
Additionally, conducting quarterly penetration testing can help businesses meet the expectations of their stakeholders, including customers, investors, and employees. Customers, in particular, are increasingly concerned about the security of their data and are more likely to do business with companies that can demonstrate their commitment to data privacy and security.
Penetration testing is an essential component of any business's risk management strategy. By identifying and addressing vulnerabilities, businesses can reduce the risk of successful attacks and protect their assets and reputation. Penetration testing also helps organizations stay ahead of emerging threats, prioritize security investments, and meet the expectations of stakeholders.
In addition to regulatory compliance and risk management, penetration testing can provide a competitive advantage for businesses.
PricewaterhouseCoopers (PwC), an audit and assurance company that works in cybersecurity, reported that 69% of consumers surveyed believe that the companies they use are vulnerable to being hacked and attacked by cyber criminals. The same survey found that 87% of consumers are even willing to walk away and take their business elsewhere if, or when, a data breach occurs.
Businesses that conduct quarterly penetration testing can stay ahead of their competitors by maintaining a robust security posture. They can demonstrate their commitment to data privacy and security, which can be a key factor in winning new business, retaining existing customers, and building a strong reputation in the industry.
Penetration testing can also provide businesses with valuable insights into their security posture and how it compares to their competitors. By benchmarking their security measures against industry standards, businesses can identify areas where they need to improve and implement appropriate measures to address vulnerabilities.
Penetration testing can provide a competitive advantage for businesses that prioritize cybersecurity. By demonstrating their commitment to security and privacy, businesses can gain the trust and confidence of their customers, investors, and partners. Penetration testing can also help businesses reduce the risk of successful attacks, minimizing the potential costs associated with data breaches and system failures. In today's business landscape, where cybersecurity threats are becoming increasingly prevalent, conducting quarterly penetration testing is a wise investment for any organization that wants to protect its assets and reputation and stay ahead of their competitors.
Penetration testing can also be cost-effective for businesses. While the initial investment in conducting a penetration test may seem high, the cost of not conducting one can be much higher. A data breach can result in significant financial losses. Identifying and addressing vulnerabilities before they can be exploited, allows businesses to reduce the risk of such costs.
Conducting quarterly penetration testing can help businesses avoid the costs associated with downtime and system failures. By identifying vulnerabilities and implementing appropriate measures, businesses can minimize the risk of system failures, ensuring that their operations remain uninterrupted.
Penetration testing can help businesses optimize their security spending. By identifying the most critical vulnerabilities and providing guidance on how to prioritize remediation efforts, businesses can allocate their security budget more effectively.
Quarterly penetration testing can help organizations avoid the costs associated with data breaches and system failures. By identifying and addressing vulnerabilities proactively, businesses can reduce the risk of successful attacks and minimize the potential costs associated with data breaches, legal fees, remediation costs, and loss of revenue. This can result in significant cost savings in the long run.
While the initial investment may seem high, the cost of not conducting one can be much higher. Penetration testing can help businesses optimize their security spending, avoid the costs associated with downtime and system failures, and reduce the risk of successful attacks and data breaches.
Penetration testing is no longer just a technical requirement for IT departments but has become a critical business requirement for organizations. The increased connectivity of applications and the expansion of attack surfaces have made it necessary for organizations to prioritize cybersecurity health. Regulatory compliance, risk management, competitive advantage, and cost-effectiveness are the four main reasons driving business decision-makers to become more involved in cybersecurity. Compliance with regulations such as HIPAA, PCI DSS, and GDPR requires quarterly penetration testing to identify and address potential vulnerabilities. Penetration testing helps organizations identify vulnerabilities, prioritize security investments, and allocate resources effectively to reduce the risk of successful attacks. By conducting quarterly penetration testing, businesses can demonstrate their commitment to data privacy and security, which can provide a competitive advantage in the industry. Ultimately, organizations that invest in penetration testing will protect their assets and reputation, minimize potential costs associated with data breaches, and stay ahead of their competitors in today's cybersecurity landscape.