The advancement in technology has brought a shift in the way criminal activities are now conducted. The arena of cyberspace has become the new hotspot for criminal activities. Phishing scam, identify theft, hacking, and theft of intellectual property are some of the most recurring cybercrimes.
All businesses, small or big, are at risk of cybercrimes. In 2017, cybercrimes caused a loss of $600 billion to the global economy. For businesses, this loss takes multiple forms: financial, reputational, and operational.
Hackers exploit the loopholes in a company’s network security systems to steal data or send a virus. Cyberattacks are elusive and are getting more sophisticated every day. Hence, businesses need to be on the outlook for any virtual attack.
Let us see how cybercrimes impact small businesses:
- All businesses are in the race of outperforming their competitors. In such a fiercely competitive world, reputation can be a highly decisive factor in determining the fate of a business. A cyberattack can result in a breach of valuable personal data. If a company suffers from a cyber attack, it does not bode well for the company’s reputation.
It conveys the message that the business is careless and does not have sufficient internal control mechanisms. The breached company cannot guarantee the safety of customer’s and their partner’s sensitive and private information. This would be a major turn off for any potential buyer and investor. Reputational damage will translate into financial loss.
Loss of Intellectual Property and Corporate Information
- A cyberattack can wipe out electronic data stored on the company’s system. This data is extremely important for the functioning of the company. The electronic data is invaluable as it is gathered through years of hard work. Important data can include customer’s personal information, R&D reports for a new product or trade secrets etc.
The introduction of a malicious virus into the system can cause a permanent loss of important intellectual property of a company. On top of that, data recovery can be a costly and time taking process.
- As the saying goes: data is the new oil. Hackers are always in search of valuable information that can be sold at a high price on Dark Web. in 2015, McAfee Labs issued a report titled Hidden Data Economy. In this report, it was outlined that the login credentials of companies offering different services were sold illegally. The price went as high as $1400 per user.
- Countries all around the world have enacted data protection and privacy laws. Businesses are required to comply with these laws and deploy security measures. These laws exist to ensure that the personal data of customers and other stakeholders remains safe.
If your business is unable to fend off an incoming cyberattack and breach of sensitive information occurs, you may face fines and regulatory repercussions.
- Your clients can sue you and generate lawsuits against you. In a worst-case scenario, the government might revoke your operating license. These legal battles will not only cost you huge sums of money but will also reflect very badly on your company’s brand image.
Disruption of Business Activity
- Almost all business functions are virtually connected. This means that an attack on your network will disrupt the entire operational setup of your business. A powerful distributed Denial-of-Service (DDoS) attack can paralyze your entire system in a short span of time.
Giants such as Amazon Web Series, PayPal, Twitter, and GitHub have been targeted by hackers in the past few years. The major consequences of a DDos attack are as follows:
- Disruption of business activity for an undefined amount of time
- Loss of data
- Legal repercussions
- Financial losses culminating into bankruptcy
From the above discussion, it can be concluded that cyber attacks are one of the biggest threats businesses face these days. The smart way to deal with this threat is to take preventive measures that can successfully thwart a cyber attack.
Hiring a company that provides IT security and risk management services is an important step in the right direction. Contact Outsource My IT and help them secure your business from cyber threats