The average cost of a reported cybersecurity breach in the United States last year was nearly $9.5 million, and the average cost per data breach worldwide was nearly $4.5 million. But how accurate are these numbers?
The numbers reported in the media are often initial estimates based on information provided by victims of cybersecurity breaches. However, other factors can come into play when assessing the financial damage a cybersecurity breach can cause.
In 2018, Pamplin College of Business alumnus Alex Nette ’10 joined Michael Cardman ’11 to develop products and services that help businesses understand and protect themselves from cybersecurity threats. , founded Hive Systems, which provides training. Demonstrating the true cost of these cybersecurity breaches can help substantiate claims by companies that they are vulnerable to ransomware and other cyberattacks.
Recently, Nette reached out to Joseph Simpson, associate professor at Pamplin College of Business, to uncover underreported costs such as reputational damage, downtime, government investigations, and other related expenses. asked them to collaborate on a sponsored research project aimed at With support from Hive Systems, this research promises to illuminate key aspects of cybersecurity risk assessment and management.
According to Nette, the research findings could have far-reaching implications for the industry.
“One of the implications is that cybersecurity insurance policies are based on these reported numbers, but if the reported numbers are too low, businesses and organizations have There is a risk of not being adequately compensated and the business is at risk of bankruptcy,” he said.
Nette hopes the collaboration with Simpson and Pamplin will become a model and case study for sponsored research.
“This is a very difficult topic to pursue as a standard academic research topic,” Simpson said. “We believe this project has an opportunity to address an important need for businesses. Sponsored research projects allow us to impact society in ways that are often overlooked by traditional research.”
Simpson also welcomed the research team's students: Cynthia Nguyen, Ryan Sylwester, James Sun, Nebiyu Tsige, and Ashley Zou from the School of Business and Information Technology, and Nakia Sharp from the School of Business Administration. ) said it is helping collect and analyze mountains of data. According to Simpson, the students' experience with this project that has a real-world impact will help enrich their respective resumes and increase the likelihood of further study opportunities in their careers.
Mr. Simpson also emphasized the role of sponsored research in addressing real-world needs and societal impacts.
“Collaborating with industry partners helps bridge the gap between theory and application, and also helps us better understand market needs and practical challenges in research,” said Simpson. Masu.
