Can Cybersecurity Spend Drive Business Growth?

Conventional thinking says that organizations investing in digital security is a purely preventative measure – a necessity to prevent intrusions, but nothing more. Until very recently, cybersecurity and business transformation have been considered mutually exclusive concepts. At Red River, we do not necessarily agree with this view; we view managed IT and cybersecurity as not just unfortunate necessities to prevent catastrophe, but rather, key parts of a digital modernization strategy that can drive business growth. By rethinking your position, cybersecurity can deliver a significant return on investment.

Cybersecurity and Business Transformation

Before flipping the traditional narrative, let’s consider where cybersecurity stands in 2024. Recent reports indicate the global average cost of a data breach hovered around $4.88 million. That figure represents a startling 10 percent year-over-year increase. Corporations that enhanced their security measures through AI, machine learning and automation managed to reduce the hit to $2.22 million.

Business professionals who read these and other terrifying statistics usually experience a visceral reaction, motivating them to spend more heavily on cybersecurity. From a decision-maker’s perspective, increasing an outfit’s cybersecurity budget generally falls into a “cost of doing business” line item. In other words, the spend ranks among expenses such as office space leases, fuel and break room coffee. When you put data security spending side by side with other “cost of doing business” expenses, it seems counterintuitive. Let’s take a moment and flip the script on some of the ways companies think about their cybersecurity spend.

Building Trust Through Digital Strength

A Gartner brand dependability study indicates that 81 percent of people decline to purchase goods or services from organizations they do not trust. An even higher number — 89 percent — say they would abandon a brand that fails to live up to anything less than determined cybersecurity. This and other research show that trust in the digital age has emerged as a quantifiable metric. Companies that invest in proactive cybersecurity programs such as zero trust architecture and automation won’t lose clients and customers due to unreasonable security risks.

A Wall Street Journal article cites research that the average managed IT budget rose from 4.25 percent of a company’s total revenue in 2020 to nearly 6 percent in 2024. Of that relatively nominal investment, only about 10 percent is allocated for cybersecurity. That means companies are spending less than 1 percentage point of their revenue to protect themselves from a customer exodus that could exceed 80 percent.

Let’s say, for argument’s sake, the research overestimates the hypothetical losses. How much of a hit would your corporation take if clients became skittish due to a data breach? Would half bail on your brand if their personally identifiable information (PII) were exposed? Based on the hard data, it’s safe to say your operation would lose far more clients and revenue than it spends on cybersecurity.

Few, if any, organizations take the time to market the way they protect the PII of their clients and customers. Why not? It may be in your best interest to highlight the personal information protections you put in place to distinguish your brand from a crowded field.

Cybersecurity Maturity Enables Further Growth

Are there initiatives that your business could be taking but isn’t, because you aren’t confident in your ability to do so without compromising your business’ data? If so, you aren’t alone. Particularly if your business regularly handles CUI or PII, it may be tempting to just stay with what you know is fully secure – but this means potentially passing up new investments in cloud, applications or services that could ultimately boost performance.

In its whitepaper Prosper in the Cyber Economy, IBM related the case study of its client, a major American airline, which had invested in new security initiatives to safeguard client data and reduce the risk of ransomware attacks via a zero-trust approach and microsegmentation. Once it had done so, the airline found itself far more willing to adopt new cloud environments and applications thanks to its more mature security posture and reduced residual risks, giving it a leg up on the competition.

Cybersecurity Modernization Can Lead to Digital Transformation

The great general Dwight Eisenhower once said, “plans are useless, but planning is indispensable.” His meaning was that a specific battle plan might not have any use once contact was made with an enemy and the fog of war took hold, but the act of making that battle plan would give commanders insights into their capabilities as well as those of their opponent, insights which would be invaluable to finding victory.

Similarly, the act of modernizing an organization’s cybersecurity itself can be the spearhead that leads to broader digital transformation. Through adopting broader cloud security and modernizing on-prem or hybrid deployments to better serve things like zero trust capabilities, an organization can gain efficiencies. It can also become far more resilient to disruptions that would hurt its strategic planning, enabling further growth and minimizing revenue loss.

According to Cybercrime Magazine, upwards of 60 percent of small businesses close within six months of a data breach. That’s largely because employees, customers and suppliers also suffer from compromised digital assets as a result. Avoiding these losses with a robust, mature cybersecurity posture isn’t just an expense, it’s an investment.

How Robust Cybersecurity Drives Company Value

Thinking inside the box, cybersecurity serves as a tool to protect sensitive and valuable assets. Few would argue this maxim does not hold true. However, cybersecurity can also act as a business value driver.

A global study that reportedly polled 500 C-suite and cybersecurity leaders highlighted marked differences between digitally prepared organizations and others. Companies demonstrating an ability to effectively meet the challenges posed by cybercriminals today and emerging threats outpaced the value of at-risk operations. These statistics support the conclusion that proactive cybersecurity initiatives improve value.

• Rate of Transformation and Innovation: The transformation and innovation pace of companies with determined cybersecurity outpaced those with deficiencies 56 percent to 25 percent.
• Market Opportunity Responses: Organizations with advanced cybersecurity led at-risk businesses 58 percent to 29 percent in terms of taking advantage of market opportunities.
• Organizational Value Creation: Industry leaders who invest in top-tier cybersecurity have a 63 percent to 42 percent advantage when it comes to creating corporate value.

The notion that cybersecurity investment ranks among the outgoing expenses appears to be something of a misconception. Because CEOs, CISOs and cybersecurity experts have placed a laser focus on protecting critical data, we haven’t used the same innovative thinking to broaden our understanding. Cybersecurity and business transformation go hand in hand when promoted effectively.

Red River Provides Transformative Business Cybersecurity

Red River brings the experience and expertise needed to create a proactive cybersecurity posture that deters, detects, expels and opens growth opportunities. If you want to harden your attack surface, reduce the risk of a data breach and get a robust return on investment, contact us today. Let’s get the process started.