One of
challenges of cyber security at the CXO executive level is that legacy cyber
security solutions have historically been seen as just an expense for the
most part. However, next-generation solutions are poised to become
one of biggest profit opportunities for many firms. Senior management
has been reluctant to move on these next-generation solutions very quickly
however, and it’s no surprise. They have spent millions (or in some cases
billions) on legacy security solutions that simply don’t work. Many
managers know this truth first hand while others have only read about it.
Some senior executives know
their present security solutions are not working but don’t want to pay twice or
three times for what they feel they should have gotten from the first
investment. They and their IT staff also lack the know-how to
assess new solutions. Other companies see this merely as a “tech-buying”
budget decision. Many of these managers are reluctant to admit that what
they have is not working, while simultaneously hoping they don’t get hacked.
The fact is, next
generation cyber security is poised to create one of the largest opportunities
to enhance profits available to business today. Why?
Because legacy solutions are not just flawed, they eat up to 80% of
network bandwidth capacity and computer processing power. They are at risk for large chunks of
downtime. This means large chunks of money right off bottom line profits
(just ask Sony), to say nothing of the cost of fixing compromised systems and
networks when the attacks are over (U of M and Saudi Aramco). This
failure to achieve real cyber security also stifles new and innovative product and service
offerings because these products cannot be secured for export. IP is too easily stolen, copied or counterfeited (Analyst
Report IDC Oct. 2008).
What we have learned over
the years is that firms don’t focus on what they are not measuring. In
the telecom industry it was revenue-assurance solutions that were
quickly created when telecom providers began to measure unbillable network
call records for the first time and discovered that it had grown to over six percent of
their total revenue from a fraction of one percent ten years earlier.
Last year President Obama said the world is losing a trillion dollars to
cyber related crime each year. The U.S. government is beginning to
measure this but most firms still don't.
In the near future,
products, services and online platforms that have next-generation, built-in
security and privacy features (so that customer information and the
products/services themselves cannot be easily be hacked) will be given higher
valuations by Wall Street and investors. The lack of such a strategy for
enhancing profit and shareholder value will eliminate many firms as serious
competitors in their market space.
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