How to Conduct a Proper IT Risk Assessment

The Importance of IT Risk Assessment

Modern organizations rely on information systems and technology to run efficiently, produce bottom-line results and fulfill their varied missions. Whether your industry is academic, corporate, government, for-profit or nonprofit, the safety of your networks is of paramount importance.

IT attacks and security breaches cost U.S. businesses millions of dollars each year, rob individuals of their identities and compromise sensitive information such as personal health records and intellectual property. Breaches can negatively impact your customers and cause long-lasting damage to your organization’s financial footing and its brand image. That is why proper risk assessment is an imperative.

First, consider the mission and goals of your organization. Healthcare companies see risks differently than financial institutions. Defense organizations do not have the same priorities as social media platforms. Once you define your organization’s top priorities, take these next steps:

Consider Threat Environment

Determine potential threats by looking at external and internal factors and how your IT structure might be affected. Some areas to examine include:

Geographical environment and natural disasters: Where your business is located can have a direct impact on your IT structure. Your California office may experience earthquakes, fires and mudslides while that New England office might see frequent power outages due to blizzards. Pull historical data from governmental agencies, the National Weather Service, and local and regional first responders. Also, gather anecdotal recollection from employees, officers, vendors and other stakeholders.

Human-caused: Human threats can be accidental or intentional, but either can be costly and dangerous. The 2018 ballistic missile warning that panicked residents of Hawaii was likely caused by an employee who hit the wrong button. And when AccuWeather sent out tsunami warnings to the East Coast, Gulf of Mexico and the Caribbean, it was attributed to a lack of human intervention in computer code. Other internal threats may be the result of phishing scams or lost credentials. While none of those scenarios are malicious, employees with bad intent and access can wreak havoc on your internal systems.

Systems, networks and applications: Your hardware, software and data are only as secure as you and your IT team make them. They must be up-to-date, always evolving and work in sync across departments.

Conduct Vulnerability and Risk Analysis

Working within your threat environments, identify potential IT threats. Where are your strengths and weaknesses and from which threats will you be most susceptible to loss? Assign a cost analysis to each area so you can also prioritize. For example, if you lose access to your server, how long will it take to retrieve information, repair damage, replace components and recover functionality? Losses should also include productivity downtime and how it might impact your customers. Outages and data breaches are financially costly, but a breach that erodes customer confidence may have a more lasting negative impact than any single incident. And hacks that steal intellectual property could have catastrophic long-term consequences for your organization.

Build a Defense

Your IT risk assessment should identify potential threats and prioritize your organization’s reaction to them so you can build adequate defenses before an issue arises. These are the steps to take before, during and after a breach, outage or attack:

Institute protection: Based on the risks and vulnerabilities you identify in your assessment, follow best practices to safeguard your systems, networks and data, from IT security clearance based on employee rank to using cloud technologies to protect data from a physical break.

Take mitigation actions: Understanding what-if scenarios that could affect your IT infrastructure will allow you to implement a plan of action. Have a check-list of what to do in the event of power outages and security breaches that allow you to immediately put a stop in effect that will prevent a situation from escalating.

Plan for recovery: Once the incident has passed, how are you going to get back up-and-running and in what order will you access critical data? The return of functionality needs to be based around your overall business mission and operations.

Organizations need effective IT strategies and solutions to function optimally. They also need leaders who can align business goals with IT safeguards with an eye to the bottom line. If you are interested in a leadership career in IT, Claremont Graduate University’s online MS in Information Systems & Technology is a technically focused, design-centric program designed to teach pragmatic IT solutions for real-world business challenges. Learn more here.

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