Why do companies pay so much attention, effort and money in ensuring that their IT security services are in order? It’s because the information and data contained within their systems have a direct monetary value. Like nuggets of gold locked up in a vault, data that is pertinent to a company’s functions and operations have financial implications—which is why wrongdoers are trying to hack into IT systems in the first place.
If your company’s IT security services aren’t up to par, illicit entities might just “lockpick” their way into your system, and you’ll end up with a legitimate money leak in the form of data breach. The proof is in the numbers:
1. There is an uptick in the cost of data breaches
In the 2015 Cost of Data Breach Study: Global Analysis sponsored by IBM, 350 companies were analysed for research. The research revealed that in 2014, the average amount of money lost by a company due to data breach totalled at $3.52 million. In 2015, the average amount increased to $3.79 million.
2. Globally, the average cost for data breaches rose from $145 to $154 per attack.
However, data breaches such as the one experienced by movie studios, video game companies, music outfits, which involves leak of their intellectual properties can cost a company millions. Data breach costs vary greatly from less than a hundred dollars to millions. Without the proper IT security services, your company could fall under the latter.
3. The cost doesn’t just boil down to mere dollars.
More than the actual dollars lost, there is a growing fear over the possible damage to reputation, class action lawsuits and the operational downtime that has companies trying to patch up a data breach instead of working on something profitable. A data breach is debilitating in more ways than one.
4. In just 2 years, the cost of data breach has increased by 23%.
Technology has allowed faster transactions and the faster flow of knowledge. Unfortunately, this has also made it easier for hackers to launch a cooperative front when trying to hack through big systems.
5. The push from these threats have encouraged companies to be more proactive with their IT security.
In the same study mentioned above, one bank, JPMorgan Chase has attended to the rise of data breaches by investing $250 million and hiring a staff of 1,000 individuals dedicated to IT security services in 2014.
6. The number of compromised records in 2015 ranged from 2,200 to more than 100,000 records.
The 2015 Cost of Data Breach Study: Global Analysis mentioned that among the 350 companies participating in their study, some experienced compromised records of just 2,200 while some experienced a high that reached more than 100,000 compromised records. The study defined one compromised record as one individual whose information has been stolen from the database of a company.
7. Data breaches cost diminished goodwill from customers.
If a company can’t protect its consumers’ information from hackers, people will not be willing to provide their information to that business out of fear of identity theft—thereby leading to lost business. The consequences from this had a total average cost of $1.57 million in 2015.
8. The cost of data breach varies by industry.
Some industries are more vulnerable to a data breach than others, especially in terms of financial losses. In the study, some of the highest averages went to healthcare organizations that lost $363 per stolen record and the education sector which lost $300 on each account of a data breach. The lowest rates are from the transportation ($121) and public sectors ($68).
Data breach threats are legitimate threats as these numbers have proven. So, if you’re a company and a big part of what you do involves online transactions, your IT security services need to be tight. The faster you can act on a data breach, the sooner you can stop bleeding money—and even better if you can prevent one altogether.