Under modern business conditions, it’s almost impossible to work without software. Applications are everywhere. Managers use them to control workflow, accountants calculate expenses, and customers access providers via dedicated interfaces. Spending on enterprise software grows constantly and may exceed $500 billion by 2020. While the importance of various digital tools is undeniably beneficial, it enables new challenges. What if a banking server stops working? Or a database with all the customers’ details crashes? With great convenience, software tools deliver great risks. And it’s crucial to know about them and enable effective risk management.

Our experts have completed a few projects focused on software security. In this guide, they share this knowledge. You will learn about risk management basics, software security total risk management (SSTRM) model, and IT risk register. As well, we will talk about the most important security trends for 2020.

Understanding risk management basics

Let’s agree on one key fact: risks are everywhere and all businesses face them. The task of dedicated teams is to foresee these problems, gather knowledge about them, and mitigate them with the highest efficiency. Failure leads to harmful consequences: revenue loss, extra costs, halt of operations, the discontent of clients, and even data leaks/breaches. All the points are valid for cybersecurity and software risks because applications are integrated into all business stages now.

Generally, risk management tasks come to four points:

  1. Identification of potential risks by departments, domains, roles, etc.
  2. Evaluation of risks based on general approaches.
  3. Determination of occurrence chances for each risk/category.
  4. Assessment of impact in case of risk mitigation failure.
  5. Assigning the exact threat level and selecting the category.

Further, we will return to these steps, including new tasks – ones that help to solve remaining issues and eliminate risks.

Usually, software risks combine business and technical aspects. To define the exact software integrity level, it’s better to analyze both aspects separately. IEEE offers the next criteria.

LevelConsequences in case of software failure
4Grave consequences: an employee’s death, system destruction, etc.
3Serious consequences: injury, system harm, great financial damage, etc.
2Minor consequences: medium revenue or reputation loss.
1Negligible consequences: tiny financial or social impact.

To understand the combined risk, set the risk level for both technical and business factors and then multiply these numbers. Levels from 1 to 4 fall into the first category, from 5 to 8 – in the second, from 9 to 12 – in the third, and from 12 to 16 – in the fourth. For example, if the ERP’s failure results in huge financial problems but barely affects the tech side because of the simple structure, it will have the 4th and 2nd levels, respectively. Thus, the total level will be 8 and this risk will fall into the 2nd category.

If you’re interested in more tips for CIOs and CTOs, check the article on tech portfolio management from DICEUS experts.

Risk management processes

Let’s move to the approaches focused on risk management, including software security. We will list three ways where the first one includes basic points that managers use all the time regardless of the domain. The second model is SSTRM – it’s focused on software security analysis solely. Finally, the last section tells about the IT risk register. This tool can help a lot if you want to break down risks by categories and evaluate them.

Starting steps

Managing Risks in 5 Steps

While risk management teams focus on identification and evaluation, they also must deal with problems, solve them or monitor them constantly, at least. Regardless of the business segment, the following steps are essential for all companies:

  • Identify. There are dozens of risk types and you want to spot them accurately. Market risks come from competitors and regulators, software risks are based on the apps you use. We suggest using a dedicated tool for risk management. With it, employees can record and check risks automatically, request reports, and analyze them better.
  • Analyze. The next step is to understand the risk scope and the business functions affected. Some issues may destroy the whole company by voiding its bank accounts. Others are just inconvenient tiny bugs. Security risk management solutions allow managers to compare risks, factors, and functions quicker and in a simpler way.
  • Evaluate. Once you know everything about current/potential risks, it’s time to rank them. The level of severity defined earlier is a viable parameter that shows how dangerous each risk is. You can use the IEEE’s grade to rank the issues or ask us to develop an application for custom categories for your business nature.
  • Treat. Finally, it’s time to deal with the identified and ranked risks. If possible, try to eliminate them by contacting in-house or external experts from the appropriate field. Say, cybersecurity specialists can fight data breaches while marketing managers are masters of customer-related risks.
  • Review. If it’s impossible to eliminate risks at all (e.g. environmental or market risks), consider monitoring them. Keep a watch on the related factors and performance of the affected departments/branches. Again, automated risk management systems can notify the responsible employees or teams if any factor changes.

These steps are universal but not exhaustive. To deal with business risks, especially ones related to security and digital apps, you may be interested in more advanced options. The next two sections cover two examples of these approaches.

SSTRM model

Moving to more precise tactics, let’s talk about software security or cybersecurity risks. It’s obligatory to use the steps mentioned above to start working with these issues but how to boost the efficiency of your risk management? One of the top-rated modern approaches is called SSTRM or software security total risk management. It’s based on traditional IT security risk strategies but represents a more accurate assessment of vulnerabilities and better reactions.

Analyzing Risks Using SSTRM Matrix

This model provides for two stages: measurement and action. The first one is based on the total matrix that considers both technical and business sides, as well as risks and threats. Such modeling allows addressing all core issues by wholesome testing. Examples are:

  • Security risk modeling.
  • Controls risk modeling.
  • Threat modeling.
  • Attack modeling.
  • Code review.
  • Penetration testing.

Coupled, these techniques define all possible ways in which employees or customers may face a problem. SSTRM unveils vulnerabilities, their likelihood, and costs related to unmitigated risks or expenses required to eliminate them. This comprehensive approach distinguishes the SSTRM model from other approaches.

The second stage utilizes the previous matrix to execute key steps of risk management. The discovery step focuses on reviews of existing apps, the assessment includes the first stage to analyze everything, the strategy helps to prioritize risks and manage them, and execution comes with real measures provided in the strategy.

SSTRM Risk Evaluation & Mitigation Process

IT risk register tool

Finally, let’s move to the third point that can be useful for cybersecurity specialists. IT risk register from EDUCAUSE is a database and checklist created for IT experts to help them in risk mitigation. The tool includes various IT risks sorted by types or domains. Authors mention that the register isn’t an exhaustive list of risks but rather a starting point for businesses. It should help to overview the most common types, understand how to assess them, and self-check the in-house risk management program.

The risk register is based on six types and eleven domains:

1. Types of risks:

  • Compliance – related to law violation.
  • Financial – related to the company’s finances.
  • System/Service – related to provisioning.
  • Operational – related to daily operations.
  • Reputational – related to the company’s image.
  • Strategic – related to global missions.

2. IT domains:

  • Administration & Management.
  • Support Services.
  • Educational Services.
  • Research Services.
  • Data Centers.
  • Communications Services.
  • Enterprise Infrastructure.
  • Security.
  • Identity.
  • Systems & Apps.
  • Business Continuity.

Additionally, the risk register allows managers to assess risks using checklists with the qualitative model. Each risk can be graded by three parameters: likelihood (the chance of occurrence), impact (the consequences of occurrence), and velocity (the speed at which the company feels the occurrence). Each feature can be graded from 1 to 3 where 1 is low and 3 is high. Then, the tool calculates the average level and shows the overall importance of each risk.

How to deal with risks maintaining the highest efficiency? Apart from top strategies, chief executives should be aware of current trends emerging in this sphere. Peter Firstbrook from Gartner says that trends reflect ongoing shifts in cybersecurity that aren’t widely known but have a huge impact. By reacting to these trends, businesses can boost resilience, cut costs, and reach goals quicker.

Let’s look at them.

1. Pragmatic risk appetite statements

Similarly to CIOs who often struggle to explain why a certain technology is required for the business, security risk managers (SRMs) face problems in communication with stakeholders. Even when they participate in meetings, other managers and executives rarely fully understand the danger of specific risks or problems related to being risk-averse. Thus, employees responsible for risk management should be clear, relevant, and informative as possible.  

2. Evolutions of security operation centers (SOCs)

In 2020, more companies will pay higher attention to SOCs because of their new roles. From general points that focus on cybersecurity, these departments will transform into advanced hubs responsible for threat/risk detection, intelligence, and response. SOCs become business assets now. Moreover, Cybersymbiosis with reference to Gartner reports that half of all current SOCs will evolve by 2022.

3. Continuous adaptive risk and trust assessment (CARTA) expansion

The mentioned strategic approach postulates that there aren’t perfect security measures. Thus, companies should evolve all the time adapting to changing environments. Usually, CARTA is used in innovative industries. However, today, more traditional markets start utilizing this vision to respond to new risks. For instance, email security and LAN security teams switch to the CARTA model.

CARTA for Efficient Risk Spotting and Eliminating

4. Mainstream cloud security

Cloud applications are on the rise, too. With higher convenience and speed, more challenges appear in front of cybersecurity experts so they invest more in protection. In dedicated cloud centers, businesses use new technologies like security brokers, workload protection, and posture management. It’s likely that cloud-based systems will become more regular over time so it’s important to know about risks related to them.

Cloud-based systems are greatly convenient for outsourcing. Find 10 the best countries to outsource in our guide!

5. More premium services from vendors

With the constantly rising complexity of cybersecurity software and risk management strategies, it turns that employees fail to handle the tasks. Technologies based on AI or blockchain demand more professionals than the market can deliver. That’s why vendors of different software tools focused on risk assessment/mitigation offer premium packages. They include not the software itself but implementation, modification, support, and maintenance services.

Managing risks with DICEUS

Our company also delivers these services to all customers. Regardless of your market segment, business size or tasks complexity, we’re ready to create or update the security system. Don’t forget that even the best software tools require a proper strategic basement. In this case, our professional analysts also can help by reviewing your operations, exploring marker conditions/competitors, and delivering the most suitable risk management approaches.

Don’t hesitate and contact us today!