How Much Should You Spend on Cybersecurity?
More money is being spent on cybersecurity than ever before. In 2021 itself, Gartner expected the security and risk management spending to surpass the $150 billion mark. The consulting giant estimated a surge in investment across all the major cybersecurity segments – application security, cloud security, identity access management, network security equipment, consumer security software, and more.
Clearly, enterprises are taking the plunge and responding to the growing cyber threats, and understandably so. The need for cybersecurity is becoming more and more relevant with ever-expanding digitization initiatives. So, like other business functions, cybersecurity also requires a financial investment and needs considerable space in the budget. But how can businesses objectively determine the required level of investment? Let’s discuss.
How Much Should You Spend on Cybersecurity?
Security breaches can have disastrous consequences, especially for small to medium-sized businesses and startups. In fact, 60 percent of small businesses go out of business within the first six months of being a victim of a cyberattack or security breach. Therefore, security should be high on priority, but it can be challenging to determine the starting point. To that end, creating a cybersecurity budget should be the first and the most crucial step toward a better and more secure environment.
The right budget must address the spending on important facets, including the geography, sector, culture, type of data stored and managed, regulatory requirements, and complexity of IT infrastructure. The budget will be higher for businesses with stringent compliance requirements, and it can also increase if any new threat is acknowledged that can lead to a security breach. The security budget for firewalls and antivirus remains constant, but new technologies and a dynamic IT landscape bring new threats that can lead to increased spending.
Ideally, the security spending of 6-7 percent of the total IT budget should be dedicated to cybersecurity. If compliance is also added as an integral part of security, that should be another 4-6 percent of the IT budget. So, on average, the total cybersecurity spending budget should be approximately 10-14 percent of the total IT budget. Not adhering to this recommended spending is a critical oversight and can increase the possibility of a breach.
Which Security Aspects Should You Focus On?
Even if you have decided on a tentative cybersecurity budget for your business, it is essential to determine the specific security areas. To that end, here are the top technologies you should focus on:
- Wireless security
- Access and authentication
- BYOD security
- Data protection
- Malware prevention
- Visibility of network traffic
- Endpoint security
Maintaining cybersecurity is a significant challenge for all businesses in today’s evolving threat landscape. The conventional and reactive approaches to protecting systems against security threats are no longer sufficient. To keep up with the dynamic security risks, a proactive approach is required, along with real-time security assessments and continuous monitoring as a part of the security framework. That being so, let’s dive deeper into the creation of a cybersecurity budget.
How To Create Your Cybersecurity Budget?
Step 1 – Creating the Foundation
The first step is to get a detailed list of your assets and understand the related laws and industry regulations that can affect your business. Consider the following questions to create a foundation:
- What is the industry you are dealing with?
- What is the size of your company?
- Which assets and devices are being used in the organization?
- What is the type of data used in the organization?
- What are the laws and regulations that can affect your business?
Step 2 – Evaluation Process
In this step, understand the operational processes of the company. Here are some questions that can help:
- Where is the data stored and shared?
- What is the method of data storage and collection?
- What is the role of people involved in the business processes?
- What are the products and software being used by the company?
- What are the possible vulnerabilities of current products and software systems?
Step 3 – Defining the Cybersecurity Budget
The aforementioned details will clarify the security needs. At this stage, you can conduct a security vulnerability analysis. Here are some questions that can help in determining the cybersecurity budget:
- What are the security solution requirements for your business?
- What are the possible options and their cost?
- What is the time duration of their deployment?
The Bottom Line – Spend Wisely on Cybersecurity
Effective allocation of financial resources is one of the most important aspects of business success. Devoting the right budget to the most needed business areas is imperative. And cybersecurity is definitely one of those critical business functions. While determining a cybersecurity budget, you can consider the above tips to ensure that your security needs are met without any excessive spending.
Apart from that, you must seek expertise on the specific cybersecurity technologies required by your business. It is critical to bring on board skilled, competent, and certified professionals that can ensure that:
- The right technologies, tools, and techniques are being used.
- The cybersecurity budget is being effectively spent.
- The desired results as per the cybersecurity strategy of the company are being achieved – i.e., the IT and cyber security risks are well understood and mitigated.