The Complete Guide to Managing IT and Cyber Risk

What is IT and Cyber Risk

Information technology is no longer a siloed function within an enterprise. Today, technology powers almost business units and organizations within a company. With that technology comes risk in the form of a cyber attack, a data breach, social engineering attack, and any other cyber event that can disrupt business operations or damage the company’s credibility. As with any other form of risk (financial, operational, etc.), companies must embrace some IT risk to achieve their business goals, be it the adoption of new technology or forgoing an update or upgrade of legacy technology to save money. Each technology decision comes with a set of risks.

Identifying, analyzing, and mitigating the risks that the company accepts based on a given strategy falls to information security leaders and their teams to ensure that the organization stays secure while on the path to growth.

What is IT Risk Management

IT and cyber risk management is a critical function in today’s businesses. As more organizations have come to see IT risk as an essential part of an overall enterprise risk management program, defining, tracking, and mitigating cyber risks has become a regular talking point in Boardrooms across the globe.

IT risk management is the process by which information security teams identify risks, understand the potential impact that they could have on the organization, and prioritizing remediation based on their potential impact to determine how to allocate resources to mitigate potential risks to the extent possible.

Read more about IT and cyber risk management.

Managing cyber risk, like any business function, requires an understanding of how the organization is tracking, analyzing, and mitigating risks.

Risk Assessment Templates

The cornerstone of all IT risk management programs is the risk assessment. Sometimes mandated by cybersecurity regulations to achieve compliance, risk assessments enable an organization to understand the risk landscape at the organization level.

Risk assessments are typically done using a risk assessment template or framework. Many organizations turn to leading standards and regulatory bodies for guidance on how to approach their risk assessments. Top organizations that have published robust risk assessment templates are the National Institute of Standards and Technology (NIST), the International Organization for Standardization (ISO), and the Center for Internet Security (CIS).

Read more about risk assessment templates.

Risk Quantification Methods

Following a risk assessment, information security teams are responsible for analyzing and quantifying the risk discovered. Quantifying risk in a meaningful way enables executive management to integrate IT risks with the forms of business risk they have been basing decisions for decades.

As many CISOs and information security leaders have begun to embrace risk quantification in their programs, so too has the discussion around which risk quantification method is best - to understand what risk quantification methods are most commonly used and how to choose one for your organization, read more here.

Risk Registers

Especially for larger organizations responsible for tracking large volumes of risks for the enterprise, risk registers are an optimal way to keep track of and aggregate risks for the entire organization. By developing IT risk registers, information security teams can understand which cyber threats are of the most significant impact and probability. Leaders can prioritize asset allocation to manage those risks in line with the overall risk management strategy.

See examples of cyber risk registers here.

Cyber Risk Management Tools

Managing IT risk has become a Board and executive-level issue. As more business leaders demand more insight into CISOs risk management program, the manual and modular processes that served them well when operating in a silo are beginning to break down. As a result, a new generation of cyber risk management solutions has emerged to help modern CISOs.

Learn what to look for in an IT risk management tool here.

In recent years, we have seen a tectonic shift in the way executives and Boards approach cyber risk. Before the Equifax breach, IT and cyber risk operated mainly in a silo, and information security leaders would typically report to the Board annually on the organization’s cybersecurity posture. However, today, Boards and CEOs are demanding greater insight into security practices and IT risk data. As a result, CISOs must prepare and embrace their role as the bridge between business-side executives and technical security teams.

Using a Risk Matrix to Present to Executive Management

Risk matrices are a standard method for conveying risk information to business leaders. In the case of cyber risk managers and information security leaders, a cyber risk matrix is the culmination of your organization’s efforts to identify, analyze and quantify, and mitigate cyber risks facing the organization. As a result, this helps business leaders understand where the organizations stand on cybersecurity and help all stakeholders understand where to direct resources for risk mitigation and develop response plans.

Read more on Cyber Risk Matrices and how to make one for your organization.

Why Black-box Risk Quantification Falls Short in the Boardroom

A trend that has followed on the back of CEOs and Boards requiring more insight into the cybersecurity posture of the enterprise has been the rise of “black-box” risk quantification and reporting tools. These platforms and tools often ingest risk assessment data and produce reports with obscure quantification of the organization’s cybersecurity risk. This is detrimental information security leaders and organizations at large for a host of reasons. CISOs should be wary of products that offer little insight into how they quantify cyber risk.

Read more about the problems that can arise when CISOs rely on black-box risk quantification.