Business Resiliency: Learn from the Military
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A steel bar is resistant to stress and is capable of maintaining its form while bearing large loads. While steel is also known as one of the world’s strongest metal’s (Titanium, Tungsten and Iconel round out the top four) , it is also susceptible to shearing and completely breaking. A rubber brick, on the other hand, will bend easily under even small loads, but it’s extremely difficult to snap or break. Moreover, once the load is removed from the rubber, its flexibility returns it to its original form. This is how the rubber brick displays resiliency.
Business resiliency enables organizations that have suffered a damaging incident to bounce back to their former form. This is especially important for small and medium sized businesses because according to Tim Francis, enterprise leader for cyber insurance for Travelers, 60% of all cyberattacks in 2014 struck small to medium-sized businesses. If you think company strength will protect you from this type of adverse incident, you are mistaken. Since salary and benefits for the workforce represents one of the largest expenses for a company, the “Revenue per employee” ratio is often used by investor as a measure of company strength. This ratio is most useful when comparing companies within the same industry. Using this ratio, the following companies were fairly strong before they were attacked but they didn’t have the resiliency to bounce back afterwards:
- Code Spaces (Annual Revenue $2.4M, Employees: 12, Revenue/Employees: $200,000) was cited by SC Magazine as one of nearly 60% of small businesses that fail within six months of being hacked. The company was accessed through via its Amazon Elastic Compute Cloud control panel. The attackers attempted to extort the business by claiming a “large fee” would resolve data loss issues. Code Spaces was unable to continue operations as it acknowledged that the company had suffered debilitating damages to both its finances and reputation.
- In 2011 Distributed.it (Annual Revenue: $691,092, Employees: 2, Revenue/Employees $230,364) had secured 10% of the market for Australian domain names, held multiple international domain accreditations and had 30,000 hosting clients through 3,000 active resellers. Later that year the business suffered a severe cyberattack when attackers targeted and destroyed servers inside Distribute.IT’s network, including back-ups, then locked the IT team out, meaning the only way to get control was to ‘pull the plug’ at the datacenter
By way of comparison, in 2015 the revenue per employee ratios for IBM and Panasonic were $244,447 and $275,839 respectively. So how should a company build up resilience against a cyberattack?
Years of conflict have taught the military how to build resiliency and researchers with the National Center for Post Traumatic Stress Disorder (PTSD) have actually developed a scale to rate psychological traits that promote resilience. Called the Response to Stressful Experiences Scale (RSES), the measurement has been tested in more than 1,000 active-duty military personnel and identifies six factors that are key to psychological resilience:
- Positive outlook
- Active coping
- Learning and making meaning
- Acceptance of limits
With this as guidance, business leaders can take the following steps towards building cyber resiliency within your organization:
- Build a positive outlook by educating senior management on the cyber threat and the practical steps that can be taken to prevent economic and reputational losses;
- Actively cope with the threat through an active cybersecurity defense team with the responsibility to protect corporate assets;
- Build self-confidence by periodically testing your cyber defense and business continuity processes;
- Establish a continuous learning environment through regular and relevant training events for the entire staff;
- Understand your limits and manage cyber risks that can’t be eliminated; and
- Believe in your team
In addition to these worthwhile leadership activities, more pragmatic steps should include:
- Establishing a company-wide end to end approach to high availability based on technology, processes and your organizational requirements;
- Practical backup and disaster recovery procedures that are exercised regularly;
- An economic on-site or off-site data backup service that leverage cloud-based resources; and
- A business continuity management plan that reduces risks and improve availability while simultaneously controlling operational expenses.
With any luck, these steps will not only make your company more resilient, but it may also help you prevent the debilitating effect of a cyberattack.