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Why should you put a price tag on your business’ reputation ?

Dom Cobb, the main character of Christopher Nolan’s movie “Inception”, released in 2010, has a few monologues about ideas. For Dom, ideas are the most powerful force in the universe. And he compares them to viruses:” Resilient…highly contagious”. 

And here’s the trick : in contrast to brand image, engineered from scratch by an organisation itself, the reputation is built by the “others” stakeholders, both inside and outside the company. 

In other words, public opinion crafts your company’s reputation. And remember,  people are buying trust, not products or services. 

What happens when cybersecurity joins reputation costs. 

In a digitalized and interdependent world, the upsurge in cyber attacks and data breach have put many companies in the spotlight.  

And although the attacked organisations present themselves as “victims” of the cybercrime, in the eyes of their shareholders, partners, employees and public opinion, these organisations have failed on their duty to properly protect their assets and data.

If the exogenous or endogenous factors that trigger a crisis situation are multiple, security and data breach are now on the Board’s agenda. 

Thus the 4 major risks feared by companies are : 

  • Financial risk and cash flow control
  • Customer/employees personal data risk and legal consequences
  • Risk of business/operations interruption
  • Reputation risk

These major risks feed into each other. 

A Forbes Insights Report, in collaboration with IBM, indicated that almost half of all organisations, 46 percent, experienced reputation and brand damage due to a security breach. Additionally, 19 percent had suffered from reputational damage, caused by third-party security breach or IT system failure.

And the financial impact by cost category is the following : 

  • 29 % Reputation and brand damage
  • 21 %  Lost of productivity 
  • 19% Lost revenue 
  • 12 % Forensics
  • 10% Technical support
  • 8% Compliance/regulatory 

But if the worst arrives, cyberattacks and ransomware is more than that. 

It is still difficult to model financially immaterial costs like the loss of credibility, loss of clients confidence, loss of trust among employees and partners.

Only companies that have undergone major cyber attacks can testify to the damage suffered in the medium and long term. 

So how to avoid making the headlines and reduce costs if it happens ?

Especially when ideas are ” Resilient…highly contagious”. 

A company undergoing a cyber attack has 3 deadly enemies: 

  • The lack of time 
  • The lack of internal coordination
  • The lack of technical and professional knowledge 

And 3 friends: 

  • Cybersecurity culture, beyond awareness
  • Business centric crises process and response plans
  • Top technologies and trained teams

In the PPT Framework – People Process Technology- the most valuable assets in a company are people, especially because they are making things happen. 

Employees manipulate more sensitive data than ever before. 

After the 2020 study co-published with Professor Jeff Hancock from  Stanford University , “Understand the mistakes that compromise your company’s security”, security company Tessian review in 2022  their first figures, after the pandemic era : 

  • Phishing email : 52% clicked because it looked as though it had come from a senior executive at the company, unlike 41% in 2020;
  • Lost of a customer or a client due to an employee sending an email to the wrong person:  29% in 2022, up compared to 20% in 2020;
  • Scam via text message : 56% of employees have received a scam via text message, and 32% complied with the request in the scam messages

Education and tailored cyber awareness plans reduce the incidents, protect the reputation and transforme the employees into genuine human firewalls. 

But if an unexpected occurs and the crisis is triggered, corporate and operational communication should be considered business as usual. Proactive and informative communication delivered on time is the key to take appropriate response.

And if you still have doubts about the price of reputation, just ask Snapshot, who still remembers this 2018 tweet from Kylie Jenner causing in a few hours  a sharp drop of 6 percent in the stock market price, the equivalent of $1.3 billion. 

Contact us to help you to reduce your cyber risks and protect your business. 

Ideas are ” Resilient…highly contagious”. Some of them are valuable, and this might be good for business.