Cybersecurity Spend Grows as Part of IT Budgets
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According to research from Gartner, IT security accounted for just 5.2% of IT budgets in 2022, indicating a relatively small portion. However, this percentage represents an improvement from the previous year, driven by the objective of risk reduction.
Companies are clearly reevaluating their approach to security spending to ensure the protection of their business operations and maintain smooth functionality.
While traditionally, corporate leaders typically exhibit low tolerance for risk when it comes to safeguarding business assets, increasing threat actors and the reputational harm they cause are bringing well-needed boardroom and C-Suite attention to the genuine threat posed by cyber risks to the organization's well-being and overall financial interests. The C-suite is becoming increasingly committed to mitigating cyber risk.
"Organizations are now better informed about the risks associated with their application landscape, impacting transactions and data, and are taking steps to secure those applications for security and compliance purposes," said Piyush Pandey, CEO at Pathlock.
Budget Increases for Security?
“Budget increase” is perhaps misleading. Rather, as organizations make critical decisions regarding budget allocation, there is a greater understanding of the impact cyber risk and incidents can have. Company leadership continually seeks ways to reduce costs by eliminating redundancies and inefficiencies and turning more towards automation and elimination of niche tools in favor of consolidation of functionalities. Where compliance solutions offering ready-baked certifications were once the vogue, CISOs, CIOs, CTO’s are recognizing the value of integrated risk management and platforms that offer a diversity of capabilities to enable teams to scale and mature the information security program.
"CISOs and CIOs are increasingly focused on optimizing and reducing the costs of security operations through the consolidation of tools, increased automation, and fewer full-time employees required to operate various tools [...] and maximize their investment" explained Roy Akerman, co-founder and CEO at Rezonate.
The Compliance Factor - There is no compliance without Risk Management
Regardless of economic fluctuations, government and industry regulations continue to exert significant influence on security spending. Compliance standards play a pivotal role in guiding organizations' security priorities and budgetary decisions.
Cyber Incidents Carry a Hefty Price Tag.
According to IBM's 2022 data breach report, the average cost of a data breach reached a record high of $4.4 million.
Moreover, companies that fail to comply with regulations often face substantial fines and fees, adding to the financial burden associated with cybersecurity incidents.
Meeting regulatory compliance requirements is an expensive endeavor, particularly for industries subject to multiple laws and regulations. Increasingly, this is a year-round endeavor, where compliance requires risk monitoring, the ability to identify and prioritize issues and implement mitigation and control measures in real-time.
Nonetheless, it is more cost-effective to allocate funds for security measures upfront than to bear the financial consequences of a breach. As such, those companies that integrate Governance, Risk and Compliance, taking a more proactive approach to protecting their products, assets and the overall company will likely save money and stake a claim that strong security has a direct impact on the profitability of the organization.
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