A quick guide to effective Cyber Asset Value Quantification

Cyber risk comes in all shapes and sizes, right from data breaches that leak confidential data to unsecured IoT devices that compromise critical healthcare infrastructure. Considering this, how can businesses evaluate and quantify the actual value of their cyber assets?

Effective quantification of every cyber resource’s worth is essential to assess risk exposure and make informed decisions.

For instance, Group Health Cooperative of South Central Wisconsin (GHC-SCW) fell prey to a cyberattack that compromised sensitive information of over 533,000 individuals early this year. Such damage goes beyond just financial or reputational losses in such incidents. Better awareness of these intrinsic values is essential for mitigation of associated threats to cyber assets.

Our quick guide provides a step-by-step approach to evaluate and quantify the value of your organization's digital assets. These methods will ensure a better understanding of your cyber assets and their impact on business operations.

Before we move on to the finer details, take a look at Figure 1 - 7 steps to assess and quantify digital asset value to understand how businesses can go about on this front.

Step 1: Zero in and classify

A comprehensive cyber asset inventory ensures a clear overview of the organization’s online footprint. Yet, identification of each digital asset can prove tricky in cyber asset quantification exercises.

Cyber asset inventory is more than just a list of hardware, apps, or network components. It calls for a constantly updated inventory of every digital asset, right from databases and websites to Intellectual Property (IP) and social media accounts.

Manual methods like spreadsheets or databases fail to address the inventory needs of today’s distributed business infrastructure. This is where automation using a Cyber Asset Risk Management (CARM) platform significantly aids asset identification and classification.

Once the inventory is complete, organize assets according to their categories. These exercises can utilize characteristics like intellectual property, customer information, or operational data.

Infosec teams can comprehensively map assets using CARM’s automated inventory and classification features in such exercises. This is vital to create a structured cyber asset quantification framework.

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Step 2: Assess and assign asset criticality

Post inventory and classification, each cyber asset must be categorized as per its criticality. One method is to determine each asset’s impact on business operations. This will give an accurate assessment of the importance of each aspect to your business.

For instance, how critical is your Health Information Exchange (HIE) platform for the business when it comes to factors like revenue generation or customer loyalty? Or how much will downtime due to an attack on your ERP system affect your operations? Can your clinic ever recover if there is a customer data breach due to vulnerabilities in your mobile app?

Regulatory aspects associated with the specific asset can also be factored in as part of this exercise. A case in point is the applicability of Health Insurance Portability and Accountability Act (HIPAA) on sensitive information.

Determination of asset criticality must be followed by prioritization based on their importance to the business. Leverage methods like scoring each factor to arrive at a total criticality score for each asset. This enables the creation of a priority list based on ranking of assets from highest to lowest business criticality levels.

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Step 3: Zero in on each asset’s value

This is where the real calculations begin. It calls for an assessment of a digital asset’s value with the help of quantitative parameters like:

·????? Financial valuation

·????? Market valuation

·????? Cost of replacement

·????? Intangible value of the asset

During this phase, financial valuation involves an estimation of the direct revenue contribution by each digital asset. It is also common to calculate the cost savings or efficiencies gained through its use. For instance, multiple methodologies can value the revenue contributions from a Telemedicine system.

Market valuation entails comparison of sales of similar digital assets in the market. Industry benchmarks can be handy for gauging their value. Replacement cost estimation relies on calculating the cost to replace (or rebuild) the digital asset in case of a detrimental event.

Intangible value considerations include the impact on brand reputation, potential customer loss, and impact on future business due to an asset's compromise. These add up to a comprehensive assessment of the digital asset’s value.

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Step 4: Determine risk exposure

Start off with an identification of all potential threats such as cyber-attacks, data breaches, and system failures. Factor in even the impact of unexpected surprises like possible regulatory changes as part of this exercise.

Proactively factor in the effect of black swan events during cyber asset valuation calculations. A case in point is INTERPOL’s findings which indicate a substantial rise in cyberthreats during the early days of the COVID-19 pandemic. Even political events like elections or unstable regimes may introduce cyber threats to organizations.

Evaluate all possible vulnerabilities associated with each asset. For example, vulnerabilities can come in the form of outdated software, weak security protocols, and lack of backups.

The next step is to estimate the impact on the overall business due to possible financial losses. This calls for an assessment of the effect of such incidents on business operations, as well as potential reputation damage.

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Step 5: Craft mitigation strategies

This phase is all about proactive defense tactics. Here, the first action item is to implement regular software and systems updates. This will address security vulnerabilities and ensure the latest security measures. Complement updates with regular security audits to identify and address any weaknesses in security infrastructure.

Establish robust backup and recovery processes to minimize the risk of data loss in case of a security breach. This ensures quick and efficient recovery of critical data.

Educate employees on best practices for cybersecurity and data protection through comprehensive training programs. These programs must cover topics such as how to recognize phishing attempts, use strong passwords, and secure data handling procedures.

Explore the option of cyber insurance policies for coverage of potential losses. For instance, such policies can cover financial losses, legal fees, and costs associated with data breaches.

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Step 6: Period valuation reviews and updates

Regular reviews will ensure the accuracy of digital asset valuations and risk assessments. Evaluate the digital assets' current market values and assess potential risks. Periodic reviews provide a comprehensive understanding of digital assets' value and risk exposure within your organization.

Continuously update the asset inventory to reflect any changes. Promptly add new digital assets to the inventory, even as you remove obsolete or deprecated ones. Such ongoing maintenance ensures that the asset inventory remains accurate and current.

Establish best practices to monitor changes in the business environment, technology landscape, and regulatory framework. Such changes significantly impact the valuation and risk exposure of digital assets. Staying informed about these developments enables your team to proactively adjust valuations and risk assessments that reflect the evolving landscape.

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Step 7: Document and report findings

Meticulous documentation of digital assets' valuation and risk exposure assessments is essential to make informed decisions. Facilitate these objectives with comprehensive reports that delve into the intricacies of the assets' value and potential risks.

Reports must be effectively communicated to key stakeholders. Include top leadership, investors, and relevant departments to ensure optimal decision-making and risk management strategies.

Accurate valuation of cyber assets and associated risks is crucial to maintain security standards. With its advanced Asset Monitoring and Threat Prioritization tools, Culinda's CARM platform offers an end-to-end solution to proactively identify assets, assess vulnerabilities, and manage associated risks. Its extensive feature set provides risk quantification capabilities to prioritize risks, proactively address threats, and meet regulatory requirements.

Contact us today for a quick consultation on how to further your Cyber Asset Value Quantification strategy with Culinda.