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Why SMEs and SMBs Fail After a Cyberattack?

by Jawad Jamil | Jul 19, 2018
Cyber attacks in Australia

Malicious cyber-attacks happen every minute, every day, all over the world. From the smallest startups to the largest organizations, cyber-attacks have become a common occurrence.

Companies, whether how big or small, suffer from cyber-attacks. The number of cyber-attacks almost doubled from 82,000 in 2016 to 159,700 in 2017, driven by ransomware and new attack methods.

However, the small and medium-size businesses and enterprises face far greater threats, risks, and challenges combating cyber-attacks. In fact, 60% of SMBs who faced cyber-attacks had to shut down within 6 months as they could not recover.

In this article, we will give you the main reasons for SMEs and SMBs failing to recover after a major cyber-attack.In addition, we will also discuss what we can do to prevent such attacks.

Unable to afford crucial IT and IT staff

A robust IT department is critical for staying abreast of and implementing protections from the latest security threats. However, to be truly protected, companies must purchase multiple security systems to guard key entry points.

The IT department must protect four main security components; the user identity, the device used, the network they’re connected to and the cloud services they’re using. This normally leads to purchasing at least four different security platforms.

The challenge is not only in deploying multiple security systems but also managing them and maintaining their daily operations. SMEs and SMBs cannot afford to hire more IT staff as they don’t have the budget for it. Whereas the big corporations can afford the whole IT department stacked with large security teams.

This disparity in staff and proper IT often leaves SMEs and SMBs a lot more vulnerable to cyber-attacks. And, worse, when a major attack happens, they are unable to recover because they lack the technology and staff to do so.

Inability to provide ongoing cybersecurity training

Ongoing security education and threat awareness also play a role in why SMEs are an easy target. it is important that staff are continuously trained and updated on current threats and the different ways to mitigate or respond to them.

For smaller enterprises with limited resources, this is not always an option as it requires sending staff to conferences, courses, and other expensive educational training programs. Programs which the small businesses cannot afford.

This lack of cybersecurity training leaves SMEs and SMBs vulnerable as they don’t know the kind of threats, they are looking for ahead of time, how to respond to them when they do hit, and are often totally blindsided on how to fix them.

Ransomware is much more devastating for SMEs and SMBs

Ransomware is a huge security problem for any size company. Ransomware was the fastest growing threat in cybersecurity in 2017.

Most ransomware attacks don’t have a happy ending—at least for the victim and typically end in favor of the attackers. For a big organization, that might be a hard blow to take, but still, it will be a manageable one, while for an SMB or an SME, it will devastate any chance of getting back to regular operations.

A bad reputation can’t be ignored in the age of the internet

Companies serving customers have a responsibility to keep them safe. Keeping private information secure is an expectation, and in some cases, the law. So, when personal information is compromised, customers rightly feel violated and often seek financial restitution through the courts.

For SMEs, costly breaches can not only break a company’s bank but lead to a media storm of bad press. Ultimately, a company’s failure to protect customers’ private information can and will live forever in the annals of the internet, bruising a company indefinitely. The news can also lead to current customers leaving and potential one’s going elsewhere.

While it’s true a dent in the company’s reputation is a hit for any size company, large organizations have more resources to handle a crisis. They often possess a large legal team to fight any battle in court, and PR firms to employ crisis communications. Small businesses are not always quite so lucky. Additionally, once hit with a security breach, many smaller operations lack the financial resources to hire a PR firm to handle the bad press, let alone employ a large legal team. Devoid of such resources, SMEs often succumb to bad press and can be bankrupted in court

What lies ahead for SMEs, SMBs, and cybersecurity

SMEs and SMBs do have inherent advantages over larger companies. For example, their agility enables them to be flexible and adjust to changes quickly. They lack the red tape and complexities larger organizations have to overcome to get things done fast.

Keep in mind, an SME needs to seek solutions matching their size and needs, and not necessarily the same solutions used by a big organization. Smaller companies can crowdsource and be the first to use security collaboration tools, taking advantage of their cost-effectiveness.

Smaller companies with smaller IT teams can use and consider autonomous systems to help them not only detect but also mitigate security threats. The idea of a full protection solution doesn’t belong only to the top-tier companies and can be introduced and adopted by SMEs if they keep an open mind to the new wave of cyber security solutions emerging.

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8 Reasons Your Small Business is at risk for a cyber attack