What Is Risk Management?
Risk management in cybersecurity is the practice of identifying and minimizing potential risks or threats to networked systems, data, and users. Following a risk management framework can help organizations better protect their assets and their business.
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What is enterprise risk management (ERM)?
ERM is a comprehensive approach to managing risk across a large organization. An ERM program helps organizations identify their risks and assess their impact on the business. A successful ERM strategy can help reduce operational risk and financial risk, while improving compliance and security.
Why is risk management important?
Risk management is important because the process helps organizations prepare for potential threats to the business. When organizations have a comprehensive risk management plan in place, they are better equipped to make decisions that safeguard their data and systems from attacks.
What are the benefits of risk management?
An effective risk management strategy can enable benefits like:
- Reduced risk of data breaches, system outages, and other security incidents
- Fortified security of data and systems
- Protected reputation
What is vulnerability management?
Vulnerability management is the process of proactively identifying security weaknesses and flaws in IT systems and software, tracking the vulnerabilities, then prioritizing them for remediation.
What is the difference between managing risk and managing vulnerability?
Risk management is different from vulnerability management. Risk management helps identify, assess, and mitigate potential threats and vulnerabilities across an organization, while vulnerability management targets weaknesses in systems, processes, or assets to minimize the likelihood of exploitation.
What is risk-based vulnerability management?
Risk-based vulnerability management prioritizes remediating cybersecurity weaknesses based on their likelihood of exploitation and impact. Because not all vulnerabilities can be fixed, businesses need to prioritize the highest-risk vulnerabilities to efficiently improve risk posture.
Types of risk-management strategies
Choosing a risk management strategy
Selecting a risk-management strategy involves first assessing the probability of risks and their impact. For example, vulnerabilities exploited by an attacker can lead to system compromise, data theft, and service disruption. Organizations can then adopt one or more of the four risk-management strategies: avoidance, reduction, transferring, or acceptance.
Risk avoidance
In a risk-avoidance approach, teams implement policies and technologies that help eliminate risk. Risk avoidance involves efforts to eliminate or more closely manage activities that invite organizational risk.
Risk reduction
The goal of a risk-reduction strategy is to reduce to an acceptable level the probability of financial or operational loss.
Risk transfer
Risk transfer involves shifting potential loss to a contracted third party. Purchasing cyber insurance is an example of a risk transfer.
Risk acceptance
After avoiding, reducing, or transferring risk, organizations may accept some residual risk when its potential impact is low or insignificant. With the proper guardrails in place, managing the business around some level of acceptable risk through risk-based prioritization can be a prudent way forward.
Risk-management process
Develop a plan
The goal of a cybersecurity risk-management plan is to identify and mitigate critical threats to your business. To reduce your risk of cyberattacks effectively, plan to prioritize vulnerabilities that pose the greatest threat to your organization. Follow each step in the risk-management process below to proactively manage and reduce organizational risk.
Identify risks
The first step in the risk-management process is to conduct a risk assessment. Identify the likelihood of potential vulnerabilities and attacks and which assets would be impacted. Determining the probability and impact of potential attacks can help prioritize efforts and focus on the risks most relevant to the organization.
Identify vulnerabilities
A vital component of the risk-management process is identifying all vulnerabilities in your IT environment. Vulnerabilities are security weaknesses and flaws in systems and software that attackers could exploit. Teams use vulnerability scanning and management tools to uncover security weaknesses and mitigate them.
Mitigate risk and vulnerabilities
Deploy security tools to remediate your vulnerabilities and effectively reduce risk. A risk-based approach helps teams identify which vulnerabilities should be remediated first. A variety of solutions make addressing critical risks easier, like risk-based vulnerability management tools, intrusion detection systems, firewalls, and security awareness training.
Continuously monitor
Monitor key performance indicators and key risk indicators across the entire network to help ensure the success of risk mitigation measures and proactively address potential threats.
Prepare for incident response (IR)
Before a vulnerability turns into an urgent security event, prepare an incident response plan that the IR team can follow. The goal of an IR plan is to identify threats, minimize their impact, and prevent incidents from reoccurring.
Plan for recovery
Develop a disaster recovery plan (DRP) to help IT teams restore operations in case a security incident lasts a day or longer.
Types of risk-management solutions
Security risk-management advisory
Security risk-management consulting services use human and digital intelligence to help organizations identify risk in their environment and make data-backed decisions to meet their business goals.
Security risk assessments
Security risk assessments are a key component to understanding an organization's risks and building business resilience. Regular testing can help identify vulnerabilities in security infrastructure, defenses, and responses.
Threat-management solutions
Threat-management tools help reduce risk by detecting threats, analyzing them, and executing responses. Examples of threat-management solutions include:
- Endpoint detection and response (EDR)
- Managed detection and response (MDR)
- Extended detection and response (XDR)
- Incident Response Services
Vulnerability management solutions
A risk-based vulnerability management solution provides organizations with a way to determine the relative risk that software and device vulnerabilities or weaknesses pose to their environment. This insight helps organizations remediate the vulnerabilities that matter most. An effective program helps lower an organization's risk profile.
Monitoring tools
Continuously and proactively monitoring network traffic helps mitigate organizational risk. Deploy monitoring tools that enable a complete view of the organization's IT environment to empower teams with real-time threat and anomaly detection.
Incident response plan (IRP)
An incident response plan establishes a procedure for security personnel to identify and mitigate threats, and to take actions that help prevent threats from reoccurring. Because it's impossible to prevent every threat, it's important to determine steps, policies, and responsibilities in case of a security incident.
Cisco risk-management solutions
Risk-based vulnerability management
Cisco Vulnerability Management empowers organizations to proactively remediate vulnerabilities, prevent exploits, and reduce risk in as few moves as possible with streamlined workflows, comprehensive threat intelligence, and advanced risk prioritization.
Risk-based endpoint security
Cisco Secure Endpoint boosts security across your endpoints with scannerless visibility, risk-based vulnerability context, and actionable risk scores that help teams prioritize the right vulnerabilities for remediation.
Extended detection and response (XDR)
Cisco XDR leverages artificial intelligence (AI) and Talos real-world threat intelligence to prioritize threats by greatest risk and act on what matters most, faster.
Rich threat intelligence
Cisco Talos equips risk-management teams with zero-day vulnerability intelligence to identify high-priority security vulnerabilities and enable data-backed decision-making.