A cyberattack is a deliberate, malicious attempt to disrupt, damage, or gain unauthorized entry to computer systems, entire networks, or other data sets. By exploiting software vulnerabilities, human errors, and hardware weaknesses, hackers compromise systems, steal information, halt operations, and cause extensive financial harm.
Cyberattacks have evolved and changed with the advancement of technology, so how these attacks play out can be hard to keep track of and understand. Attackers may use different methods to attack their targets including ransomware attacks, social engineering tactics, and phishing attempts. Because cyberattacks can take so many shapes and cause massive amounts of damage, businesses should try to stay one step ahead by fortifying preventative protections and continuously conducting employee training.
In 2024, it is expected that cybercrime will cost the US $452 billion. If a business or government entity falls victim to a massive cyberattack, the impact can be catastrophic. 60% of small businesses that experience a cyberattack go out of business within 6 months of being hacked. Stolen sensitive customer information, financial data, and network passwords can lead to astronomical costs and an even longer-lasting business issue:
Whether it’s data theft, system hijacking, or a financial scam, hackers have many different motivations for conducting attacks. Most of the time, cyberattacks stem from personal, criminal, or political motivations.
Depending on what’s motivating a specific hacker, they’ll be seeking out different information when conducting an attack. Some hackers are looking for company databases of Personal Identifiable Information (PII) such as names, addresses, and social security numbers of customers and employees. This information can then be sold on the black market. Other hackers may attempt to disable business systems or cripple operations in order to demand ransom payments from organizations that are desperate to recover.
Politically motivated hackers, on the other hand, are less concerned about financial gain and more focused on orchestrating a massive cyberattack to gain national security information, exploit government intelligence, sew distrust of public officials, or even disrupt key national processes such as elections.
Whatever a hacker’s reasoning is for perpetrating these types of attacks, cyberattacks pose a threat to businesses big and small, government entities, and even individual households.
Cyberattacks are one of the biggest threats to businesses today. Something that business owners didn’t have to think about 25 years ago has become a top-of-mind consideration for leaders today.
Our latest Cybersecurity Guide for CFOs examined the current costs of cybercrime, and the numbers are astounding:
Because of the impact a data breach can have on a business, customers, stakeholders, employees, and investors can all fall victim to cyberattacks. The main lasting impacts of online threats are financial loss, reputational damage, operational disruption, and legal and regulatory consequences.
Theft of funds, operational disruptions, and recovery costs associated with cyberattacks are just the tip of the iceberg. Publicly traded companies experience an average stock price decline of 7.5% following a data breach, and looking at the financial impact regardless of business size, the average cost of a cyberattack is $200,000. These attacks can lead to financial ruin when businesses are unprepared and slow to respond.
A data breach that exposes customer information can severely damage a company’s reputation amongst customers, business partners, and stakeholders. As trust erodes, sales may decline, customers may seek other sources for their needs, and long-term brand recognition will suffer.
Very common in ransomware attacks, the operational disruption of a manufacturing plant or other business site can be felt for weeks, months, and even years after the attack takes place. Downtime, loss of productivity, and delivery delays can create a downstream ripple impact, too, affecting supply chain, customer service, and overall business performance.
As the world adapts to cybersecurity issues, businesses may face legal and regulatory consequences following a cyberattack. These consequences can be lawsuits from impact parties, investigations by regulatory authorities, and penalties for failing to comply with data protection laws.
Cyberattacks can take many forms, and because the technology landscape is always changing, attack methodology is always changing, too. Some of the biggest watch-outs are:
A blanket term for harmful software that can infect computer systems and entire networks, malware is capable of stealing information, destroying business operations, and wiping entire databases. Perhaps the most well-known type of malware is ransomware. Ransomware attacks take systems hostage and hackers force the business in question to pay a ransom before releasing the system and allowing it to continue operating.
One of the most creative forms of cyberattacks is social engineering. With this method, hackers convince people to do harmful things by tricking them into believing they are supposed to be doing those things. For instance, someone entering an office claiming to be a computer repairman and asking an employee to write down their passwords in order to “fix” something would be considered social engineering.
Phishing attacks are a type of social engineering and the second most common cause of data breaches. Emails that come from unrecognized accounts or odd email addresses may be phishing attempts. Often, these emails include a link to click that will steal information or trick people into inputting additional details after clicking the link.
Denial-of-Service (DoS) attacks inundate business systems or websites with fake traffic, causing the system to either crash or be unreachable by normal users. Because these attacks render platforms useless, they can lead to downtime impacts, customer attrition, and reputational damage. Sometimes, DoS attacks are used to distract from a bigger attack that’s about to happen.
Remember those phishing emails that you get on a regular basis? If cybercriminals get the login credentials to a machine or system, they can use those credentials to log in as a legitimate user and conduct harmful activities. Even if a hacker didn’t get username and password information from phishing or buying it off the dark web, they can use automation scripts to test thousands of different login combinations in an instant.
MitM attacks involve a hacker gathering information that was shared between two people such as emails or text messages. When using public Wi-Fi networks, there is an elevated risk of MitM attacks. In some cases, the hacker doesn’t just intercept information but also alters the data transmitted between the two people, potentially leading to identity theft, data theft, and more.
When cybercriminals break into a business’s supply chain, they can target all of the vendors, suppliers, and transport companies involved in the end-to-end supply chain. This method underscores the importance of cybersecurity measures not only to protect customers but also to protect business partners and vendors.
Cyberattacks happen every single day around the world. Small businesses, large enterprises, nonprofits, government organizations, and individuals fall victim to these harmful attacks regularly. To emphasize the variability in cyberattacks, let’s assess a few major attacks in recent history.
In what the American Hospital Associated called, “the most significant and consequential incident of its kind against the U.S. health care system,” UnitedHealth was the victim of a cyberattack that threatened millions of sensitive records, including patient insurance information and health details. Since the attack happened on February 21, 2024, the extent of the damage is still unknown. However, UnitedHealth experienced days of system downtime, and hundreds of thousands of medical claim disruptions.
In 2023, the city of Dallas experienced a ransomware attack that disrupted court systems, water bill payments online, and first responder technologies. That’s right, the 9-1-1 dispatch system went down, leading to emergency personnel relying on pens and paper to record and handle emergency calls. It took over a week just for city websites to get back online, and computers in more than 22 fire vehicles, trucks, and ambulances had to be wiped clean.
Cyberattacks happen all over the world. Last year, Latitude, an Australian personal loan company faced an attack that impacted 14 million individuals in Australia and New Zealand. As a result of the attack, 1.2 million clients had sensitive information exposed.
Prevention has to be a priority if organizations are aiming to avoid cyberattacks. Although there are many competing business priorities discussed in every boardroom, cybersecurity should be one of the top focus areas. Some of the best practices for preventing these attacks are:
Even the most well-meaning employees can open doors for hackers. By ensuring your teams have ongoing cybersecurity training to stay up-to-date with current tactics and learn best practices for personal security, your organization will have an extra layer of protection. Recognizing phishing attempts, creating strong passwords, and reporting suspicious activity can all be included in these trainings.
Implement multi-factor authentication across all systems and applications to add an extra layer of security beyond passwords. MFA requires users to provide additional verification, such as a code sent to their mobile device, before accessing accounts or sensitive data, making it harder for attackers to gain unauthorized access.
Managed IT providers are IT companies that specialize in information technology and cybersecurity. These are especially great resources for small businesses that don’t have an in-house IT team because they grant businesses access to a team of cybersecurity experts. If business leaders don’t have the time to keep up with the ever-changing cybersecurity landscape (hint: most don’t!) contracting an IT provider is their best bet.
Keep all software, operating systems, and firewalls as updated as possible. By letting systems forego updates, organizations are opening security vulnerabilities that hackers can exploit.
If the worst-case scenario happens and a cyberattack is uncovered, no business should be caught without a plan. A disaster response team helps improve cybersecurity outcomes by putting a response plan in place before the attack happens. There will be no confusion about who needs to do what. Instead, this team can spring into action to achieve the best possible outcome.
For most businesses, a cyberattack is a matter of “when,” not “if.” If a cyberattack is discovered, these to-dos should be top priority.
Background Refs:
A ledger, also referred to as a general ledger, is a list of financial transactions. This financial report summarizes transactions for a …
An open-end mutual fund is a portfolio that is comprised of pooled investors that can issue an unlimited number of shares. Mutual …
Net asset value, known as NAV, is a method for calculating the value of an investment fund or mutual fund. This valuation …
End-to-end B2B payment protection software to mitigate the risk of payment error, fraud and cyber-crime.
