I know some of you will read this article and think "oh wow - this guy has truly drank the Kool-Aid!" but before you pass judgement, give this a whirl and think about how this could be a game changer for your business.
This article is going to explore GRC, what it is, and why GRC is a Game Changer for Small Businesses.
Let's start with the basics. What is GRC anyways?
GRC, which stands for governance, risk, and compliance, is a vital set of practices and processes that help businesses align their goals, manage risks, and meet regulatory requirements. While commonly associated with large corporations and highly regulated industries, GRC can also revolutionize the way small businesses operate, allowing them to thrive and succeed in today's competitive and complex business landscape.
So, why should small businesses prioritize GRC implementation? Here are some key advantages of integrating GRC solutions into your business strategy:
1. GRC enables you to define and communicate your business's vision, mission, and values, aligning them with your overall strategy and performance. This ensures that everyone in your organization is united in working towards common objectives.
2. GRC assists in identifying and evaluating risks, implementing suitable controls and mitigation strategies to minimize the likelihood and impact of adverse events such as cyberattacks, fraud, data breaches, operational failures, legal issues, or reputational harm.
3. GRC aids in compliance with industry-specific laws, regulations, and standards, shielding your business from fines, penalties, legal action, or reputational damage that could threaten your operations and credibility.
4. GRC facilitates the monitoring and measurement of your business performance, allowing you to report on achievements and demonstrate value to stakeholders such as customers, investors, partners, employees, and regulators.
5. GRC supports process improvement, product and service enhancement, and the development of a culture of continuous learning and innovation, leading to increased efficiency, quality, and customer satisfaction.
Implementing GRC solutions for your business doesn't have to be daunting or costly. You can start by adopting simple GRC practices, including:
- Developing a clear and concise business plan outlining your vision, mission, values, objectives, strategies, and action plans.
- Conducting a risk assessment to identify and prioritize internal and external risks based on their likelihood and impact. (Search the web for key words such as "risk assessment" +"[insert your industry here]" +"free").
- Establish a risk management framework that defines risk appetite, tolerance, and responsibilities for effective risk management.
- Implement policies, procedures, guidelines, audits, and training to prevent, detect, and mitigate risks. (Formally known as "risk controls").
- Regularly monitoring and reviewing risks and controls, updating them as necessary to adapt to changes in your business environment, goals, or performance. (Can be once a year depending on your business).
- Ensuring compliance with relevant laws, regulations, and standards, keeping abreast of any updates or changes that may impact your operations. (Talk to a lawyer and an accountant for advice here).
- Documenting and reporting your GRC activities and outcomes, communicating them effectively to stakeholders. (It is super important to write things down, including when you reviewed things and who did the review. A simple "log sheet" that has "Date, Name, Comments" is more than enough).
- Seeking feedback from stakeholders and implementing improvements based on insights and lessons learned.
By following these straightforward steps, you can integrate GRC solutions into your business operations, safeguarding your enterprise, achieving objectives, and gaining a competitive advantage. Remember, GRC is not a burden or expense but an investment and opportunity that can truly transform small businesses.
But why would you bother in the first place? And what does an IT firm have to do with GRC?
It is actually quote straight forward. We all know we need to maintain compliance with tax laws. From collecting sales tax, remitting the money to the government, to paying corporate tax and so forth, these are things we already do. But have you documented what these things are that you do?
What about your IT processes? Most companies do not realize their fiscal responsibility to protect the data that they store. Many business leaders do not realize that in some jurisdictions, if you have a cyber security event that leads to losses, you could be personally liable! Yes, your business would be responsible, but if your actions (or lack of actions) led to the incident (i.e. you did not do what you were legally supposed to do), you are potentially exposing yourself personally to legal action.
The risk is just not worth it in my opinion. Especially when there is help readily available to protect your data, your customers, your company, and yourself.
There are laws currently in place throughout North America that mandate certain GRC criteria for any size business, even those that are 3-5 people working out of a basement. There are new laws being passed every year that push the companies that hold the data to protect it. What are you doing to ensure your data is safe, and that your business is compliant?
How are you managing risks? Are you doing everything possible to protect your business?
These are all critical questions that every single business leader needs to ask themselves on a regular basis.
Here is a quick short story that happened to a peer recently. This is a true and factual story, but I will leave all names out of the picture.
There is a small business in the US that the leadership team that runs a very successful operation serving other businesses. They do not have any retail operations - 100% B2B. They had an employee download an app a few weeks ago from some random app store. That app contained malware in it (known as a "Payload App" - basically, it poses to be something like a free game but in the background it has software that threat actors use to hack your environment). The phone became the vector of attack, giving the bad guys access to the internal environment. Not only did it cause their company to go down for over a week, but the threat actors also took out their 5 top customers. In total, the ransomware exceeded $2M USD. Imagine getting phone calls from your top 5 customers that basically make up the lion-share of your business, being told that your company was the source of a supply chain attack and just crippled your top 5 customers?
Had the company implemented proper measures ahead of time, the risk would have likely been identified that their staff cell phones are a risk to the business. They could have implemented simple (and inexpensive) software to mitigate the risk (maybe $5/phone/month). That simple step could have prevented the incidents from happening, and likely would have saved his business. (I am hoping they survive, but it does not look good at the moment).
Please talk to someone. Get informed. Don't look at GRC as a make-work-project, or "something the big guys do - I don't need to worry".
The statistics are available online. The vast majority of attacks that threat actors do is against the small business space. They are easier targets, the attacks can be automated (as per my example above - an app that keeps getting downloaded), and the criminals have realized it is easier to attack 100 small businesses versus 1 big target that will take months to hack and will likely have the systems in place to recover.
Ransomware attacks are a significant threat to both small businesses and large enterprises. Here are some statistics I pulled online (with links to their sources):
- In 2021, 37% of all businesses and organizations were hit by ransomware1.
- The average cost of recovering from a ransomware attack was $1.85 million in 20211.
- Out of all ransomware victims, 32% pay the ransom, but they only get 65% of their data back1.
- Only 57% of businesses are successful in recovering their data using a backup1.
- 82% of ransomware attacks in 2021 were against companies with fewer than 1,000 employees2.
- 37% of companies hit by ransomware had fewer than 100 employees2.
- A 2020 survey revealed that 68% of organizations in the United States had experienced a ransomware attack and had paid the ransom as a result3.
These statistics highlight the urgent need for small businesses to prioritize cybersecurity measures, especially in defending against the growing threat of ransomware attacks. A strong cybersecurity strategy is crucial in today's digital landscape, where the impact of a data breach can have significant financial and reputational consequences.
But how do you know where to start?
Simple. Back to why this article is being written.
By conducting a comprehensive risk assessment of your organization, you can pinpoint vulnerabilities, implement proactive security measures, and mitigate potential risks before they escalate into costly incidents.
Investing in a sound GRC strategy will ensure you are making sound cybersecurity decisions to not only safeguard your business but also fosters trust and confidence among your customers, partners, and stakeholders.
Remember, it's always better to prevent than to cure when it comes to cybersecurity.