What is Cyber Risk Quantification and Why Does an Industry Specific Approach Matter?

April 22, 2022
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Anil Gandharve
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Beth Dannemiller
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In our last blog we discussed the security challenges of omni-channel digital businesses and that security teams have limited oversight into the comprehensive ecosystem that impacts the overall cyber risk of the organization. In this blog we’ll explain how cyber risk quantification and an industry-specific approach to managing cyber risk provides quick time to value and aligns business stakeholders working on digital transformation and cyber risk strategy.

Simplifying the Language of Risk

Security conversations tend to be very tech stack and hindsight driven. Security teams struggle to communicate with the broader business units and leadership teams of the business operations that they're trying to help secure — and the further away from the tech stack you go, the harder it is for security leaders to have a conversation that aligns security strategy with business goals.

Due to the expanding complexity and frequency of cyber-attacks, risk conversations are taking place in every boardroom — nevertheless, boards have become weary of alarmist scare tactics to steer decision-making for cyber security investments. The challenge is that technology and security leaders struggle to connect the dots between cybersecurity risks, compliance and business operations when having these conversations. Cyber Risk Quantification (CRQ) is a streamlined and reliable way to translate cyber risk scenarios into financial terms. CRQ compares the potential financial impact of a cyber threat with the probability of the occurrence — it bridges the gap between technical and business -speak, informing decision-makers on what kind of impact various risk scenarios could have — helping them weigh different courses of action.

A New Approach to Cyber Risk

Alfahive is the only cyber risk quantification platform to deliver an industry specific, scenario-driven approach to cyber risk that helps you tie your financial risk directly back to your actual digital business processes and company KPI’s. Alfahive provides retail, hospitality and consumer-facing organizations expertly curated threat and industry-specific risk research that provides unique insights — empowering you to more effectively steer your investment choices and in form your budget spend based on the potential severity and financial impact of an event to individual business operations as well as the overall enterprise and digital business strategy.

Why Industry Specific Cyber Risk Quantification is Better

Our approach is different, on purpose. The Alfahive cyber risk quantification platform leverages advanced modeling techniques to estimate the range of probabilities and impacts of potential security events so that retail leaders from various business operations can calculate key financial risk metrics, such as value at risk or expected loss. We apply the model to industry specific use cases so that you can estimate impacts and loss probabilities, determine a loss distribution, and calculate dollar loss metrics. We offer a repeatable framework to determine how risks emerge and where best to allocate resources.

Scenario-driven. Alfahive leverages multiple cyber risk models to financially quantify exposure to cyber-attacks and third-party failures that can lead to significant financial loss. Cyber risk quantification with industry-specific context provides another dimension to guide cyber investment decisions. It helps ChiefInformation Security Officers (CISOs) and Chief Risk Officers (CROs) strengthen their business cases and bolster risk management, both on a day-to-day basis and in preparation for a potential future breach.

A Successful Rollout of Cyber Risk Quantification

Our approach to helping security leaders re-cast the Cyber-risk conversation in the context of Retail and Consumer Goods Industry models involves:

Inclusive Cyber security governance – Cyber risks are embedded into every part of your value chain and managing it requires you to follow the very same business model that you follow to run your business — an inclusive approach. It enables spreading the security control awareness, embedding it to be part of the daily business intelligence, and inspiring your country leaders, business unit teams and supply chain partners to take charge of cyber security. However, making it work requires using modern technologies with a consumer-grade experience and intuitive workflow management. We have crafted a unique approach to enable this change to drive transparency and inclusiveness in security governance.

Quantify your risks holistically – Inclusive governance is a great idea, but it works only when you have a robust data-driven decision-making technique. Risk quantification is a relatively new concept, but has seen high adoption in regulated industries, especially financial services. Embracing cyber risk quantification requires in depth security research and insights in the tactics, techniques and procedures most likely to be used by threat actors against your industry. What if there was a ready-to-use cyber risk repository for an industry that you could drag and drop in your context and with little customization you could see a risk quantification visualization? That is what our industry-specific cyber risk platform does for the Retail, Consumer Goods and Hospitality industries. We have created a list of Cyber Risk loss scenarios, backed by an industry-leading research team, and our platform uses AI and machine learning to continuously learn new cyber risks that are applicable to your industry.

Speak in the language your business uses – Finally, it requires transitioning from a caterpillar to a butterfly. It requires driving the culture change to establish a natural security language whereby technology, business and security teams can communicate and exchange ideas intuitively about the risks, threats, and losses in business terms. We created a Cyber security domain model for the Retail,Consumer Goods and Hospitality industry that enables mapping your business processes and KPIs to your systems and data, thereby building a connection between business impact and security risks.  Alfahive exists to improve your cyber health so that you can thrive in the digital economy. We are transforming the way businesses understand, measure, mitigate, and communicate cyber risks to their boards, employees, and partners.Our SaaS platform breaks down cyber communication barriers, accelerates human-machine collaboration, and enables industry-specific network effects.

We help customers get answers to questions like:

  • What is your overall risk in dollar terms and impact on the business?
  • How different it is from the number that you had last year around the same time?
  • Are you doing better or worse than your industry peers?
  • Is your future security spend aligned to the risk priority of your business?
  • Are there risks that you can transfer to other parties?

In our next blog we’ll explore our deep industry expertise that we use to protect retail, hospitality and consumer goods clients and how curated threat research provides more confidence and faster time to value for your organization. In the meantime, we welcome opportunities to co-develop directly with you and research unique scenarios that are top of mind for your organization.

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