Develos/IT Risk Management - what is it?

IT Risk Management - what is it?

Risk is an inherent element of running a business and can manifest itself in various forms. Currently, IT risk management is starting to play an increasingly important role. The reason is simple: new technologies have enormous potential, but they constitute another extensive attack vector that criminals willingly use. So, what does IT risk analysis mean and how is IT risk analysis performed?

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IT Risk Management - What is it?

In the simplest terms, IT risk management is the process of identifying, assessing and controlling risks related to information technology in an organization (company, foundation, community, local government body and more) .

In other words, it is about knowing what the organization is at risk of using individual IT resources (this applies to both IT solutions and services, as well as various types of electronic equipment) and respond appropriately to eliminate threats or mitigate their possible effects.

Why is risk management in an IT project so important?

As already indicated at the beginning, modern technology gives companies and other organizations great opportunities, but is also associated with new sources of risk. It also increases the group of potential attackers - they may be not only local criminals, but even hackers from the other side of the globe who would not be able to locate the country of origin of the attacked company on a map.

Thanks to appropriate risk management in IT (both in individual IT projects and throughout the entire organization), you can get the best from technology and at the same time reduce the likelihood of falling victim to criminals. It is a fact that not all threats can be completely prevented, but usually the effects of possible problems can be at least mitigated. This will potentially avoid the loss of money, reputation or guarded trade secrets.

However, please remember that IT risk management is a continuous process. Regular monitoring of risk and the effectiveness of actions taken is necessary to maintain the security and effectiveness of IT systems. It is not enough to perform the analysis once (e.g. after falling victim to a hacker attack), make a few decisions and leave the case closed.

The types of threats, the degree of probability of their occurrence, the vulnerabilities of individual resources used by the company, as well as the types of these resources may change significantly over time, which means that sooner or later such a one-off IT risk analysis will become is simply out of date.

Why is risk management in an IT project so important?

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How to realistically perform IT risk analysis?

The process of performing IT risk analysis may be different for each company, depending on what resources it has and what project management methodology it uses. Quite obviously, IT risk management will be very complex in a huge company that relies largely on office work, which involves the use of numerous software and electronic devices.

However, it may be much less complicated (which does not mean that it is not worth attention) in small, mainly stationary operations that require the implementation of modern technologies to a small extent. Therefore, the exemplary IT risk management scheme that we will discuss below is illustrative and is a shortcut that can be a starting point for developing individual processes and solutions.

IT Asset Inventory

Inventory is a concept that may at first be associated primarily with stores and trade in general, but it is also of considerable importance in the context of IT risk management. It is difficult to determine , what threatens the company and what it must watch out for if it does not first determine which resources need to be analyzed.

It is not the case that every IT resource is associated with the same threats and vulnerabilities, and at the same time, each company may have a completely different range of resources. Hence, a reliable inventory of, among others, pendrives, disks, computers, laptops, smartphones, printers and other devices, operating systems, all kinds of software and consumables used in the company is an essential element of IT risk management.

Determining potential risks for each inventoryed resource

Once we know exactly what resources we have, we can begin the next stage of IT risk analysis, which is to determine what specific threats are associated with each of them. Some potential threats they may be common to entire categories of resources, e.g. various types of storage media, SaaS software, laptops and personal computers, others may be more individualized.

The most frequently mentioned threats to IT resources include:

cybernetic attacks, e.g. on the companys website, the place where it stores customer or user data - they can be carried out for various purposes, from sabotage, through blackmail and extortion of funds, to economic espionage;
hardware failures;
software errors;
human mistakes;
technological obsolescence of hardware and software .

As you can see, some threats may result from the bad will of the so-called bad actors, i.e. internal and external bad actors (hackers, dissatisfied former and current employees), and others may be a coincidence or the natural life cycles of IT resources.

Indication of vulnerabilities, i.e. real weaknesses of resources

Being aware of the threats lurking in individual IT resources in the organization, one is ready for the next stage of IT risk management. It is about determining the susceptibility of resources to various types of threats. Vulnerabilities are nothing other than weak points that people unfavorable to the company could exploit or that could lead to an increase in the frequency of negative random events.

For example, vulnerabilities may be the result of failure to install necessary security updates, weak passwords (and not changing passwords frequently enough), system deficiencies or errors, vulnerabilities, or failure to implement necessary security processes and solutions (e.g. antiviruses, VPNs) ).

A common weakness of many organizations is also the low awareness of employees and other working people on projects regarding the existing threats and how to act to avoid them. Hence, for example, when deciding on body leasing IT, it is worth choosing an entity that has experienced professionals aware of the best practices in the field of cybersecurity .

Indication of vulnerabilities, i.e. real weaknesses of resources

Risk Definition

In this step of IT risk management it is analyzed how much impact the exploitation of a given vulnerability may have on the organization and how likely it is that such exploitation will occur. The impact can be measured in various aspects, such as financial losses, reputational damage or disruptions in conducting business and providing customers with access to services or data. Probability is most often assessed based on the state of current security measures, previous history of incidents and general trends in cyber threats.

Every organization should have defined risk acceptance thresholds that determine what levels of risk are acceptable and what levels require intervention. By comparing identified risks (usually converted to numerical values) against these thresholds, you can improve and speed up your decision-making process.

Making a risk decision

The fact that using an IT resource involves some risk does not mean that it should be abandoned. If this were the case, companies would basically not be able to use any modern technologies, because each of them them carry some minor or major threats. On the other hand, not every risk is worth taking.

Therefore, IT risk management also involves weighing all the pros and cons and then making specific decisions related to a given source of risk. You can simply accept them, but also try to limit them in various ways, transfer them to other entities (e.g. insurance companies, subcontractors) or avoid them altogether.

Planning a companys response to the identified IT risk may include:

increasing security (at the digital level, but also, for example, strengthening physical barriers that make it difficult to gain direct access to tangible IT resources, i.e. getting into the server room);
creating emergency plans (often in several variants, so as to be prepared for as many possible scenarios as possible, especially the most probable ones);
purchasing insurance ;
training (e.g. in recognizing and responding to threats, safe work practices, data handling) and testing (e.g. by sending false phishing emails and verifying reactions) of employees.

It cannot be denied that IT risk management in an organization is not an easy task. However, we hope that with this material we have put you on the right track and you now know why it is so important!