IT risk management
What is IT risk?
Information technology or IT risk is basically any threat to your business data, critical systems and business processes. It is the risk associated with the use, ownership, operation, involvement, influence and adoption of IT within an organisation. IT risks have the potential to damage business value and often come from poor management of processes and events.
Categories of IT risks
IT risk spans a range of business-critical areas, such as:
- security - eg compromised business data due to unauthorised access or use
- availability - eg inability to access your IT systems needed for business operations
- performance - eg reduced productivity due to slow or delayed access to IT systems
- compliance - eg failure to follow laws and regulations (eg data protection)
IT risks vary in range and nature. It's important to be aware of all the different types of IT risks potentially affecting your business.
Potential impact of IT failure on business
For businesses that rely on technology, events or incidents that compromise IT can cause many problems. For example, a security breach can lead to:
- identity fraud and theft
- financial fraud or theft
- damage to reputation
- damage to brand
- damage to your business' physical assets
Failure of IT systems due to downtime or outages can result in other damaging and diverse consequences, such as:
- lost sales and customers
- reduced staff or business productivity
- reduced customer loyalty and satisfaction
- a damaged relationship with partners and suppliers
If IT failure affects your ability to comply with laws and regulations, then it could also lead to:
- breach of legal duties
- breach of client confidentiality
- penalties, fines and litigation
- reputational damage
If technology is enabling your connection to customers, suppliers, partners and business information, managing IT risks in your business should always be a core concern.
In its guidance, the National Cyber Security Centre (NCSC) provides a clear explanation of why IT risk management matters.
IT risks should be carefully assessed and measured. This is where an IT risk assessment comes in - a process of identifying security risks and evaluating the threat they pose. Once risks are identified and assessed, you will manage them through a comprehensive IT risk management process.