Automating Risk treatment decisions!

Generative AI
May 16, 2023


Organizations face a myriad of complex risks, ranging from cybersecurity threats to regulatory compliance challenges. The need to engage risk committees and the board in informed decision-making becomes paramount. In this process, security leaders play a vital role, going beyond the traditional task of reporting cyber risks to the board, they are responsible for enabling the board to comprehend and understand the true impact of these risks in business terms. By providing the board with comprehensive insights into the potential consequences and implications of cyber risks, security leaders empower them to make decisions with confidence and ensure the organization meets shareholders' expectations within the regulatory framework.

Enabling the board with multiple risk treatment options is a pivotal aspect of this process. It goes beyond the conventional approach of reporting to the board and extends to equipping them with the necessary tools and information to make informed risk decisions on behalf of the organization. This approach transcends the limitations of traditional reporting, enabling the board to comprehend the significance of risks in relation to overall business objectives. Armed with this understanding, the board can effectively allocate resources, prioritize risk mitigation efforts, and support the executive in meeting shareholders' expectations.

Challenges in current cyber risk reporting approaches 

The challenges inherent in current approaches to risk reporting and decision-making are numerous and significant.

·  One key challenge lies in the subjective reporting of risks, where security leaders struggle to articulate risks in a meaningful way.  

·  The use of technical jargon and a never-ending list of security acronyms further complicates the communication of risks to key stakeholders.

·  The lack of suitable tools and resources for creating comprehensive risk treatment options hinders effective decision-making.

·  The absence of benchmarking against industry peers limits the organization's ability to gauge its risk posture and compare its performance vis-à-vis other similar companies.  

These challenges collectively create a gap in the board’s ability to make informed risk decisions, hindering its capacity to support the executive team in proactively addressing cyber risks and protecting the organization’s assets.  

Time for a new approach: Automate risk treatment options  

It is time to embrace a new approach that empowers the executive team and the board with valuable insights into risks, enabling them to comprehend various options for managing risks, backed by evidence and data. This can be achieved by automation and leveraging advanced technologies to simulate multiple risk treatment options. By automating this process, organizations can gain efficiency, accuracy, and agility in their decision-making processes.  

This new approach enables risk managers to explore multiple scenarios, evaluate their effectiveness, and enable the board to make informed decisions based on data-driven insights. It empowers organizations to proactively identify and mitigate risks, optimize resource allocation, and ultimately enhance their overall security posture. Automation is the key to unlocking a new level of effectiveness and resilience in managing and treating risks in today's digital landscape.

Three steps for risk automation

Automate the controls inputs into risk insight

Leverage advanced machine learning techniques to automate the conversion of control inputs into meaningful risk insights. By simulating how controls work together against specific types of cyber threats using frameworks like MITRE ATT&CK and DEFEND, cyber risk managers can gain a comprehensive understanding of their risk landscape. By analyzing the effectiveness of controls against identified cyber threats, organizations can prioritize their risk treatment efforts.

This automated process eliminates the need for manual intervention, saving valuable time and costs while ensuring trustworthy and accurate risk assessments. It also enables risk managers to focus on the most critical risks, optimizing resource allocation and enhancing the overall effectiveness of risk mitigation strategies.

Automate the cost impact of the risk   

When it comes to decision-making, the board and risk committee rely heavily on financial numbers to assess the health and stability of an organization. Trustworthy cyber risk cost trend is crucial in understanding the financial implications of potential risks. It encompasses various factors such as regulatory changes, reputational risks, and potential liabilities that directly affect board members and business operations.  

By conducting a year-over-year analysis of cyber events, we identified notable trends that provide valuable insights into cost impacts. For instance:  

·  A downward trend of 4% in costs related to legal services and breach counsel suggests a stabilization in the market for these services.  

· Similarly, comprehensive crisis management costs show a slight decrease of about 1%.  

·  On the other hand, organizations affected by regulations like GDPR and CCPA experience increasing costs associated with regulatory penalties.  

Armed with this trend data, risk managers and CISOs can provide boards with enriched context for completed, ongoing, and future control maturity improvements, enabling them to make informed decisions that effectively manage costs while mitigating cyber risks.

Simulate risk treatment options

Security and risk leaders are expected to provide the executive team with a clear understanding of the available options for making informed decisions. Automating the simulation of multiple risk treatment options is essential for presenting the various scenarios to the board in an effective manner. This can be accomplished by leveraging advanced technologies to evaluate different scenarios and assess the potential outcomes of each treatment option. 

Automation enables risk managers to efficiently analyze and compare different strategies for mitigating risks, considering factors such as cost, effectiveness, and impact on business operations. Through this automated simulation, organizations can gain valuable insights into the potential consequences of different risk treatment approaches.

By evaluating various scenarios and their corresponding outcomes, organizations can make informed decisions about the most effective risk treatment options. This empowers them to allocate resources strategically, prioritize control improvements, and optimize their risk management strategies.

For example, you might convey, "Rather than allocating reserves, our focus will be on strengthening user access controls near customer data by the end of the quarter, demonstrating our readiness to handle potential increased penalties."

Key benefits

In conclusion, adopting an approach that automates risk treatment decisions offers the following key benefits

Demonstrating Prudent Behavior

By leveraging automated tools and data-driven insights, security leadership teams, as well as the board and executive, can showcase a demonstration of prudence in their decision-making. This aligns with the expectations of regulators who place a high emphasis on organizations exhibiting responsible risk management practices. Organizations can demonstrate proactive effort in identifying and addressing potential risks, demonstrating their commitment to a robust risk mitigation approach.

Increased Trust and Faster Decision Making from the Board

Automating risk treatment decisions not only provides valuable insights but also fosters increased trust and confidence from the board. Armed with data-driven information and comprehensive risk scenarios, the board can make informed decisions promptly. This enables them to respond effectively to emerging risks, allocate resources strategically, and enable the security leadership team with risk treatment prioritization. The increased trust and faster decision-making capabilities contribute to a more resilient and proactive approach to risk management within the organization.

Efficiency Boost and Cost Savings

One of the key advantages of automating cyber risk decisions is the significant efficiency boost it offers. By streamlining manual processes, security leaders can save valuable time and resources that were previously spent on labor-intensive tasks. The automation of risk treatment options enables teams to focus on higher-value activities, such as strategic initiatives and proactive risk management. In addition, the elimination of manual processes reduces the risk of errors and inconsistencies, leading to potential cost savings in the long run.