With instances of cybercrime continuing to rise dramatically throughout 2020 and 2021, cyber security has become a focus for many organisations. Examples of high-profile data breaches and hacks have spurred this focus even more, with Dixons Carphone, Tesco, and many more experiencing such breaches in 2021 alone.
Unfortunately, just as there are many businesses proactively preparing, a lot of businesses are being forced to react to a hack. Experiencing a data breach and then attempting to build a cyber security presence in a short space of time is one of the worst ways to approach the problem.
To help organisations adopt a more proactive approach, we thought it was important to highlight the consequences they could face if they were the victim of a successful hack. Keep reading to find what could happen to your business if you were hacked.
Service Outage/Loss of Revenue
There are several ways that your business can lose revenue from a data breach or hack. Firstly, an attack such as a DDOS can cause a service outage for your business. An example of this would be your eCommerce website or mobile application becoming inaccessible to your customers.
Naturally, this means that customers can’t shop with you through these methods. This leads to a loss of revenue for your business for as long as these services are down.
It also places a lot more pressure on your IT team to bring the services back up, which can lead to overtime pay being required.
As well as a loss of revenue and potential damage to your infrastructure, it can cause permanent or long-lasting damage of another variety which brings us to our next point.
Reputational Damage
Whether it’s a hack or a data breach, the reputational damage that your organisation can suffer can last a long time or even be irreversible.
Many businesses that suffer reputational damage do so due to a data breach. If a hacker breaches their network and retrieves sensitive customer data, this data can be sold or leaked.
Regardless of the kind of data, this kind of breach displays a lack of cyber security and signals to customers that they should refrain from storing their data with you in the future. Naturally, this means that they will tend to use competitors over your business.
Repairing this reputation is incredibly difficult and requires a huge amount of investment into PR, marketing, and strategic reputational management. The financial strain this can place on an organisation is enormous, combined with the loss in revenue from service outages.
Regulatory Fines
Data breaches are now punishable by steep regulatory fines. Breaches of GDPR for example can lead to fines up to £17.5 million or 4% of an organisation’s annual global turnover. Even for larger businesses, this is potentially disastrous, combined with the reputational and service-based financial losses they will suffer.
For smaller organisations that utilise personal information, a GDPR breach can still lead to fines of over £100,000.
When compared to the costs of putting a rigorous cyber security system in place, it’s a no-brainer for businesses. Recent years have shown that no business is immune to the effects of a data breach or hack, so there is no reason to not protect your business’ vital assets.
On top of regulatory fines, individuals affected by a data breach can claim compensation from the business responsible. With the minimum data breach compensation amount reaching around £1,000 and rising from there, the potential losses for an organisation go well beyond just the regulatory fines themselves.
Improving cyber security systems and processes
The final significant consequence of a hack or data breach on a business is the requirement to improve its cyber security systems and processes.
For organisations that have little or no cyber security in place, this can be an incredibly time-consuming and costly process. They will need to either outsource this process or hire cyber security professionals to manage it internally.
If they do have some cyber security presence, a full investigation will need to be launched to find out how the breach or hack occurred. Vulnerability assessment, penetration testing, and other forms of review will need to be conducted.
Once the cause has been ascertained, the costs to improve and remediate these vulnerabilities will also need to be considered.
If you are worried about the potential impacts of a cyber-attack or data breach on your business, get in touch with us today. Our cyber security experts can walk you through how to properly protect your business and ensure that you never have to face the consequences of being hacked.
