Cyberattacks are on the rise. And these security risks don't just plague large organizations. Cybersecurity concerns have also become a crucial worry for small businesses and startups.

As a result of this dynamic, more and more business owners are taking additional precautions to protect themselves from online threats. Often the first step in this process takes the form of a cybersecurity risk assessment.

In this article, we'll look at this critical security measure. We'll outline what a cyber risk assessment is, how it works, and why doing one is key to keeping your small business safe given the security situation in the modern economy.

What is a cyber risk assessment?

The goal of a cyber risk assessment is to review your organization's vulnerabilities — the places where your data could be stolen or areas where nefarious actors could attack your system. From there, you can develop strategies to minimize those risks.

It's likely that traditional risk assessments represent a routine part of your business planning. From protecting your supply chain to safeguarding your physical aspects, you constantly imagine worst-case scenarios and take steps to avoid them.

A cyber risk assessment fits into this overall process. It just turns the technique towards your potential online vulnerabilities. Through this strategy, you identify key connections, possible weak links, and methods to plug any security holes you find.

Through [a cybersecurity risk assessment], you identify key connections, possible weak links, and methods to plug any security holes you find.

Why should more small businesses and startups perform cyber risk assessments now?

The increase of cloud computing and remote collaboration has put a heavy emphasis on online resources. Businesses communicate with their customers through virtual platforms. At the same time, firms need to give their employees access to the data they need to carry out their jobs.

This trend, which has been building momentum for decades, was accelerated by the pandemic. Companies were forced to ramp up remote procedures as COVID restrictions went into place. As a result, many more companies now rely on these operations — ones that were put in place relatively quickly and under emergency conditions.

Given these dynamics, it's no surprise that many small businesses and startups face critical vulnerabilities that were only dim concerns just a couple years ago. In many cases, the firms might not even realize their true level of risk.

Meanwhile, cybercrime has become a growing threat in general. A report conducted by Checkpoint showed that cyberattacks climbed 28% in 2022 compared to the previous year. During the third quarter of 2022, specifically, the number of average weekly attacks per organization came in at over 1,130.

What are the benefits of performing a cyber risk assessment?

The risks of a cyberattack have been rising. As we've seen, more criminals have moved towards this type of attack. Meanwhile, as your business has become more reliant on virtual connections, your vulnerabilities in these areas have become more acute.

These broad conditions underline why you should consider a cyber risk assessment. However, it's also important to understand the specific benefits you can gain from this strategy. With that in mind, here are a few upsides you can achieve by launching the process for your small business or startup:

• Learn Your Risks: As a fast-growing organization, you might not even realize where vulnerabilities exist. A cyber risk assessment will give you the info you need.
• Ensure Stability of Your Systems: You never want your customers to face an outage. Understanding your risks (and taking steps to minimize them) will ensure you maintain your reputation for reliability.
• Reassure Stakeholders: Customers aren't the only group you want to impress. A strong cybersecurity system also reassures the rest of your stakeholders, from employees to investors to outside parties, like regulators.
• Protect Your Data: A well-run risk assessment gives you the information you need to build a wall around your data.
• Safeguard Your Customers' Information: You are the steward of sensitive information about your customers. A proper cyber risk assessment will help you keep them secure, allowing you to protect your brand and reputation.
• Create a Security Paper Trail: If a disaster hits, you might be asked to explain your preparations. You want to be able to show you did everything you could to avoid a catastrophe. A cyber risk assessment is a step in this direction.

How to perform a cyber risk assessment

Now you understand the advantages of a cyber risk assessment. Still, you also need to understand how to get the most out of the process. Here are some steps to take to maximize the effectiveness of this crucial security step.

Conduct an Internal Review

Take a broad look at your current cybersecurity. Understand how your business has changed since the last time you reviewed your potential risks. Sketching out this information will help you target the rest of the process.

Prioritize Risks

You might not have the time or resources to review every aspect of your business. As such, it's important to triage your online assets. What's most important to protect? What areas seem most likely to present vulnerabilities?

Engage Outside Experts

As a small business, you likely won't have the expertise you need to optimize your review. Given this reality, it's important to find an outside expert to give you the guidance you need. Review your options and connect with a third party that can help direct your efforts.

Determine Your Biggest Vulnerabilities

Helped by your outside advice, target the areas that leave you most exposed. This includes spotlighting the areas where outside actors can hack into your system. Also, review your possible internal risks. Make sure your system is protected from every angle.

Make Contingency Plans

A risk assessment isn't just about plugging holes in your defenses. It also involves planning for the worst. Discovering potential high-leverage breakdowns gives you the chance to make contingency plans.

What will you do if the worst happens? Of course, you should take whatever steps are necessary to avoid these potentially catastrophic situations. However, it also helps to have backup plans if a disaster hits.

Schedule Regular Reviews

A cyber risk assessment shouldn't represent a one-time endeavor. The process you conduct now should mark the beginning of a longer-term commitment. Create a timetable (and a budget) for ongoing reviews at regular intervals. That way, you can maintain the highest level of security over time.

Is a cyber risk assessment right for your small business?

It's been said that the best offense is a good defense. Performing a cybersecurity risk assessment fits into this approach. The strategy lets small businesses and startups build a strong defense against cybersecurity threats.

The key is understanding whether now is the right time for your business. Use the information provided here to determine if your business needs a cyber risk assessment. From there, you can determine the best way forward to secure your online operations.