The True Cost of Ransomware Attacks On Your Business
Imagine turning on your office computer one morning, and a pop-up message came on the screen saying, "Attention – Your System is Locked. If you want your data and programs unlocked, you must pay a fee of $100,000."
You try to close the message, but the text wouldn't go away no matter what button you pressed. It suddenly dawns on you that this is no prank and that your business is under attack. You now have no access to the tools you need to do your work. Some deadlines are due and the only way to meet them is by giving in to the ransom demands.
Pressured, you gave into the attacker's wishes and wired the money as instructed. They unlock your computer, and you regain access to your system. You're now back at work and ready to put this situation behind you. Or, are you? Is it really over?
The cold hard answer to this question is NO.
The cost of ransomware is more than just the demanded money. In fact, the price you'll pay to recover from such an attack amount to more than just cash.
It impacts your relationship with your customers and employees and how you run your business moving forward.
Worse, it could be the start of a reprised ransomware attack. Hackers know that you easily give in to such schemes, and they'll exploit that vulnerability until your business is done.
At Intelligent Technical Solutions (ITS), we help hundreds of businesses protect against ransomware attacks using advanced technology and by raising cybersecurity awareness.
In this article, we'll share the true consequences your business will face when struck by a ransomware attack. We'll also provide tips on what you can do to prevent becoming the next ransomware victim.
What is Malware/Ransomware?
Ransomware is a form of malware that prevents users from accessing their systems or files. Using encrypting software, hackers pull off the attack by locking the user's computer or files until they pay a hefty ransom.
The software makes its way through the target's network when users visit malicious websites or download an unverified file. Hackers also carry the attack via an attachment from a phishing email or payload by other malware.
Ransomware attacks have consistently increased in the past years, with businesses worldwide targeted by hackers. What's worse is that victims who paid ransom are targeted again for the same attack.
The True Cost of Ransomware
In 2021, the Sophos State of Ransomware surveyed 5,400 IT decision-makers about their dealings with ransomware attacks. It revealed that a company's ransom payment for such attacks averages at $170,404.
It was also noted that the average cost of addressing a ransomware attack was more than $730,000. It includes downtime, lost orders, and operational costs. The amount can even shoot up to $1.4 million when the victim agrees to settle the ransom.
But the problem with ransomware attacks doesn’t end with settling the attacker’s demand. In fact, it’s only the start, as the actual crisis comes with its fallout. Believe it or not, its cost can be more distressing than the ransom itself, leaving some businesses unable to recover.
The following are the outcomes that your business will encounter when struck by ransomware.
Every business must safeguard the Personal Financial Information (PFI) and Personal Identifying Information (PII) of clients and customers. Regulatory authorities such as the US Department of Health and Human Services (HIPAA compliance) or the Federal Trade Commission impose hefty fines on companies who let such info fall into the hands of criminals.
Fines reach up to millions of dollars but are usually not levied if there have been no other prior issues about confidentiality. For firms with previous breaches, fines can add to millions of dollars.
This is one of the immediately felt effects of a ransomware attack.
When your system is inaccessible, your employees won't be able to perform their duties. This will severely impact your business as you wouldn't be able to produce your commodity. From there, bad things can follow, such as disappointed clients, loss in revenue, and more.
To rub salt into the wound, you are still obliged to pay your employees' wages despite the condition. The bigger your team is, the greater the expense will be.
Loss of Customer Trust and Potential Clients
Most states require companies to report cybercrime incidents they experienced. This means they must disclose possible breaches and data theft of their clients.
Of course, doing so has immense repercussions. Customer confidence will plummet since you couldn't fulfill your duty of protecting their data. You can also expect them to pull out their account and look for a different service provider where they will feel safer. Meanwhile, potential customers will cross your name off their list once they find out about the attack.
All these will eventually lead to a drop in sales and a loss in revenue. Recovering will also not be easy. It will cost you tons of time and money to put your business back in its normal state.
Drop in Employee Morale
Losing a customer's trust is one thing but losing an employee's faith is another.
Employees are as concerned about their privacy as your customers. Successful ransomware attacks in your company signify that hacker can get through your network and do what they want. It includes stealing valuable data of your team members, such as banking details, social security numbers, tax IDs, and more. Believe it or not, these data are no less important than your customer's information.
Nothing hurts productivity more than uninspired employees. If employees feel unsafe in your team, you can expect a drop in their morale. Soon, they'll be passing their resume to your competitors, leaving your team struggling to stay afloat. There's also the probability of employees sharing your trade secret with your competition.
What You Can Do to Avoid These Costs
You can start by raising awareness about ransomware. Since ransomware attacks rely on your vulnerability, you must keep your network closed from attackers at all times. Conduct regular cybersecurity training that will help employees identify and suppress potential cyberthreats.
Make sure that all antivirus and firewall software are up to date. These programs work great in detecting possible network breaches and isolating malware.
Create backup files to avoid bogged productivity. Having a secured copy will allow your team to continue with their work despite a crisis in network security.
You may also want to consider hiring a seasoned Managed IT Service Provider (MSP). MSPs use robust programs and modern technology to keep attackers at bay. They also offer proactive systems checks to ensure the efficiency and safety of your network. Hiring an MSP will also allow you to focus on your role as you no longer have to look at your network security often.
Are You Aware of These Ransomware Costs?
The cost of ransomware attacks doesn't stop at the ransom. There's also the probability of getting fined by government agencies for not being able to secure the personal data of your customers.
Customer loyalty will undoubtedly be affected. Many may opt to leave for other providers, while potential clients may look for others. Team members will also experience a decrease in morale, which leads to bogged productivity and reduced work quality.
To prevent paying such a steep price, ensure that your team practices good cyber hygiene. Update your cybersecurity software regularly and raise awareness within your team. You can also opt to hire the services of an experienced MSP as they can help boost your protection.
At ITS, we help businesses protect themselves from ransomware attacks by employing multi-layered cybersecurity and sharing our knowledge on how to stop cyber threats.
Learn more about how you can protect your business from ransomware by downloading our eBook Ransomware Attack Protection.