Why Security Measures Are Necessary for Small and Medium-Sized Enterprises: Examples of Measures
Security measures are required to prevent cyberattacks and unauthorized access. Security measures are important not only for large companies but also for small and medium-sized enterprises (SMEs) in order to avoid risks such as financial losses and customer loss.
This article explains in detail why security measures are necessary for SMEs, the current state of security measures for SMEs, and what measures are necessary. If you are a manager or person in charge who wants to strengthen your company’s security, please refer to this article.
Table of Contents
- Why Security Measures Are Necessary for SMEs
- Risk of Financial Loss
- Risk of Customer Loss
- Leads to Business Stagnation
- Factors That Lead to Lower Employee Morale
- Current State of Security Measures for SMEs
- Security Measures Necessary for SMEs
- “3 Principles” and “7 Important Items to Work On” for Managers
- Practice of “5 Articles of Information Security”
- Summary
1. Why Security Measures Are Necessary for SMEs
Security measures are necessary because of the risk of cyberattacks and unauthorized access. Information leaks can also occur due to internal human error. If security measures are insufficient in the event of an emergency, companies, regardless of size, will suffer significant damage.
Below, we will introduce four reasons why security measures are important for SMEs, along with the risks that may occur.
1-1. Risk of Financial Loss
Malware infections can lock data and demand ransom. In addition, leaking confidential information of business partners or personal information such as customer data may result in claims for damages. Also, if you are unable to provide your services, you will not be able to expect sales.
Furthermore, social credibility may be lost, which could lead to a drop in sales. As a result, this may lead to significant losses, so security measures are an item you want to focus on.
1-2. Risk of Customer Loss
Information leaks or operational shutdowns due to cyberattacks can also lead to customer loss. Information leaks are a serious problem that damages the company’s credibility.
Business partners may determine that future contracts are difficult with a company that has experienced an information leak.
If there are companies that provide similar services from competitors, they will switch their partnerships to safer companies. Also, if operations are shut down, customers will start using competing services during that time and may not return.
1-3. Leads to Business Stagnation
Unauthorized access due to cyberattacks can lead to business stagnation. There are two reasons for this:
- System shutdown to investigate the cause
In order to investigate the cause of unauthorized access, it is necessary to temporarily shut down the entire company’s system. Not only will the systems you provide be shut down, but email and other services will also be unavailable. Normal operations will not be possible, which could lead to significant business stagnation. - Internet shutdown to prevent the spread of damage
If a virus is infected, the Internet must be shut down until the problem is resolved to prevent the spread of damage, which will affect all operations.
1-4. Factors That Lead to Lower Employee Morale
The occurrence of problems due to insufficient security measures can lead to factors that lower employee morale.
Some employees may know that security measures are insufficient and try to commit internal fraud such as data tampering.
Also, if only the employees involved are punished when a problem occurs due to unauthorized access, it will cause many employees to feel distrust. It is important to recognize this as the company’s responsibility and publicize and implement what can be done to prevent recurrence.
2. Current State of Security Measures for SMEs
Currently, many SMEs tend not to invest in security measures. The results of the “Survey on Information Security Measures in SMEs” conducted by IPA in 2016 and 2021 are as follows:
| 2016 | 2021 | |
|---|---|---|
| Companies that do not invest in information security measures | 33.1% | 30.0% |
The number of companies investing in security measures has increased slightly over the five years from 2016 to 2021, but there has been no major change in numbers.
The following reasons are often cited as reasons why companies that do not invest do not use security software and other products:
- I don’t feel the need
- The cost is too high
- I can’t see the cost-effectiveness
Security software does not provide visible effects, and it is difficult to realize the importance of the software unless unauthorized access occurs and a problem occurs.
However, if a problem occurs due to unauthorized access, there is a risk of losing a large amount of money more than the cost of introducing security software.
With the accelerating ITization, keep in mind that you are constantly exposed to the threat of cybercrime, and pay attention to the importance of preventing problems.
3. Security Measures Necessary for SMEs
When SMEs take security measures, keep the following two things in mind based on the IPA guidelines:
- “3 Principles” and “7 Important Items to Work On” for Managers
- Practice of “5 Articles of Information Security”
Below, we will explain in detail how managers and persons in charge can review their company’s security measures and introduce new mechanisms.
3-1. “3 Principles” and “7 Important Items to Work On” for Managers
When implementing security measures, there are “3 principles” that managers should know and “7 items” that should be put into practice.
The “3 principles” that managers should know are as follows:
- Managers and persons in charge should take the initiative
When introducing security measures, managers and persons in charge should search for and select tools that suit their company’s business content. - Consider the security measures of business outsourcing contractors
If there is unauthorized access to a contractor and information is leaked, the outsourcer may also be held responsible. Have the contractor introduce the same measures as the company’s system. Also, encourage thorough security measures when using a home computer during telework. - Explain your company’s security measures to customers
It is important to present your company’s security measures and how to respond in the event of a problem to customers who have transactions with you on a regular basis. By disclosing what measures you are taking, you can build a relationship of trust.
Also, when putting it into practice, implement the following “7 items”:
- Declare security measures to employees and related parties
Since security measures need to be implemented throughout the company, declare the measures to employees and related parties. Present a basic guideline of “What information do you protect and how?” - Secure budget and experts
Secure in advance the cost of introducing security software and the costs incurred in the event of a problem. It is also important to find an expert who can support you when a problem occurs. - Grasp risks and introduce necessary measures
Grasp all possible risks, such as unauthorized access. Introduce appropriate measures to avoid risks. - Review at regular intervals
As the business content changes, the software used and the customers involved change. Consider updating security measures to match changes in your company. - Decide on how to deal with problems when they occur
Decide on how to deal with problems when they occur. It is safe to clearly define all procedures from investigating the cause, suppressing the spread of damage, and restoring. - Clarify responses to business outsourcing contractors
If you are outsourcing some of your company’s operations, ask the contractor to introduce the same system. Also, decide in advance on the contractor’s responsibility and how to implement measures when a problem occurs at the contractor. - Incorporate new knowledge
Check information on security measures on a regular basis and always acquire new knowledge.
3-2. Practice of “5 Articles of Information Security”
In addition to running security software, practice the following 5 articles within the company:
- Software update
Be sure to update your software and OS on a regular basis. Updates also include fixes for security issues, so always try to keep them up to date. - Introduction of anti-virus software
There are increasing numbers of viruses with various methods. It is safe to thoroughly introduce anti-virus software on all devices. - Thorough password management
Set a long and complex password that is difficult to identify. Also, be careful not to reuse passwords. Also, do not place passwords in places where people can see them, such as on PCs or desks. - Review data sharing settings
Avoid sharing settings that allow anyone to access data. Set permissions only for those who need them and protect the data. - Get information on methods
By knowing the various methods of unauthorized access, you can respond appropriately and prevent problems before they occur.
Summary
SMEs need to take thorough security measures not only to prevent financial losses and customer loss, but also to prevent business stagnation and lower employee morale. Although some companies are not proactive in investing in security measures, it is desirable to prepare for the possibility of incurring more damage than expected when they are actually affected.
When a company takes information security measures, it is recommended to refer to the IPA guidelines and use private security software.
EXO Security is information security software that can be introduced at a low cost. It is easy for anyone to use, so if you are considering introducing security software, please contact us.
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