Cybersecurity professionals are facing an unprecedented amount of scrutiny. Not only are they responsible for securing and protecting their organizations, but they also need to prove that their ideas and strategies for doing so have a meaningful impact. This can be hard when the threat landscape is constantly changing and new tactics to fight cyberattacks shift regularly.
Without meaningful metrics, it can be a challenge to measure the types of and the number of risks that have been mitigated — and how much this has saved an organization from a financial or reputational standpoint. This blog discusses why measuring risk management performance is important and explores the best ways to measure risk.
Why is it important to track risk management metrics?
Risk management typically involves actively managing cyber risk within a defined area that is necessary for business continuity. Unfortunately, this process alone doesn’t offer actionable insights into how good the business is at identifying and managing cyber threats overall. More specifically, it doesn’t identify areas within your risk management process that need improvement or where your risk management team might be struggling.
To flag those areas for improvement, you need to take a closer look at and track how well your risk management process is performing. This is where risk management KPIs and metrics come in. By evaluating performance metrics, you can have a better understanding of your organization’s level of risk exposure and whether or not those vulnerabilities are being managed – ultimately, strengthening the organization’s security posture.
What are the challenges of measuring risk performance?
It’s important to be aware of the common challenges associated with collecting risk metrics and KPIs to overcome these obstacles. By properly measuring risk performance, you can ensure a higher degree of security compared to many companies today. Here are the top 4 challenges that make risk metric collection difficult:
- Unclear responsibilities: Oftentimes, risk managers don’t allocate responsibilities to appropriate team members. As a result, it becomes unclear who is responsible for metrics collection and reporting.
- Absence of data availability: It’s critical to store and have access to the right kind of data because it drives your strategic decision-making process. The more data you have, the more insights you have to base your next decision on. Unfortunately, many security teams experience data quality issues – working with inconsistent data, missing data, or redundant data. As a result, team members have to allocate a significant amount of time and resources to gather data – leading to inefficiency and unproductivity in the risk management process.
- Insufficient threat intelligence: When a potential threat occurs, you have to act fast. Threat intelligence can drive efficient decision-making processes – but only when relevant information is delivered quickly. Based on outdated software and tools they are using, many security professionals experience a delay between when a breach occurs and when it’s detected. Unfortunately, threat latency can lead to significant recovery costs and significant reputational damage.
- Lack of confidence: Many organizations lack confidence in the accuracy of their risk metrics. If the security team measures incomplete or outdated data from a single source, it could lead to inaccurate reporting and conclusions.
Once security teams address these challenges, they will be able to efficiently identify risk metrics that can provide critical insights into their security program maturity and effectiveness.
How can businesses measure risk?
There are two types of metrics used to evaluate security performance: Key Risk Indicators (KRIs) and Key Performance Indicators (KPIs). Both metrics are critical, quantifiable ways to measure risk exposure within an organization. KRIs evaluate and measure the effectiveness of the risk management process. On the other hand, KPIs evaluate the key areas deemed crucial for success and illustrate how consistently the organization achieves key business objectives.
By examining KRIs and KPIs together and over an extended period, you will be able to illustrate how far away the organization is from a given business security goal or objective. In doing so, you gain a better understanding of the likelihood that your organization can achieve its strategic objectives, as well as how effective your security and risk management programs are performing.
What are the 5 key risk management metrics to track?
Oftentimes, risk management teams fail to collect the correct metrics needed to analyze data that inform strategic direction. Here are some key risk management metrics and KPIs you should be tracking.
1. Number of risks identified
It’s important to track the number of risks identified in different areas within your organization. In doing so, you can better understand the potential threats and vulnerabilities to the network, system, project, etc. To gain a holistic view of your risk management performance, you would need to compare the number of risks identified to the number of risks that occurred, and finally compare it to the number of risks mitigated.
2. Number of risks that occurred
It’s also critical to quantify the number of risks that materialized into incidents to help better inform your risk management strategy. This metric can offer better insights into whether or not your risk management process is effective. Let’s say you’ve noticed a high number of risks that materialized into full-blown issues in your organization. Then, that would suggest the risk team would need to update their management and remediation tactics to prevent future risks from materializing. Essentially, the ultimate goal is to minimize the number of risks as much as possible.
3. Percentage of risks monitored
First and foremost, it’s always important to monitor 100% of all identified risks. Risk teams can then leverage security ratings to help them prioritize higher-impact risks for remediation efforts. Conducting routine risk assessments and continuous monitoring for all identified risks can empower your organization to detect increased cyber threat levels. This will also empower your team to take immediate action on specific cyber risks that are more likely than others to materialize.
4. Percentage of risks mitigated
Risk mitigation is another crucial step in the risk management process. Not only does the organization need to assess and analyze the types of risks present, but also has to develop a robust strategy to eliminate or reduce those risks. Risk teams can leverage risk assessments to help them prioritize and allocate resources where needed. In doing so, they can reduce inefficiencies that come from wasted efforts on low-impact risks. Risk teams should always aim to have their risk mitigation plan effectively reduce or eliminate 100% of the prioritized risks.
5. Cost of risk management programs
According to Cybersecurity Ventures, global cybercrime costs are expected to reach $10.5 trillion annually by 2025. For that reason, it’s critical to have an effective risk management plan in place – saving your business money in the long run. Risk management programs can be costly, but without a doubt, can save organizations money by thwarting cyber risks before they turn into issues. With a robust risk management strategy in place, organizations can bounce back much quicker, maintain their reputation, and avoid having to pay significant recovery costs.
How SecurityScorecard can help
Overall, it’s important to choose clear and understandable metrics for anyone who looks at your reporting — ensuring colleagues and the leadership team can read them without having to ask for an explanation. SecurityScorecard Security Ratings enable you to seamlessly establish cybersecurity metrics and KPIs and measure risk management performance. Our ratings continuously monitor a wide variety of metrics, so you know exactly what your vulnerabilities are, where they are located, with the ability to manage them in real-time. Curious to know what your score is? Get your instant free score now.