Three Hidden IT Risks That Could be Costing Your Business Millions

We have a love/hate relationship with modern technology. While the success of our businesses and personal lives is dependent on access, we often feel vulnerable, experience inconsistent access, or feel we aren’t getting its full value. Losing our phone can feel devastating, but system downtime or poorly performing systems can crash a business.

While IT risks are inherent in the workplace, there are three critical vulnerabilities every owner, executive and IT organization should focus on:

• Cybersecurity risks
• Outdated legacy applications and hardware
• Poor data quality

Each creates different risks and impacts on your organization’s operations. Some organizations may choose to skip cyber reviews or not maintain high-quality data. Others may have outdated applications and systems. However, these are “penny-wise/pound foolish” approaches.

Cybersecurity Risks

For a number of years, CBIZ encouraged a client to conduct a cybersecurity review. After conducting the review, the client committed to correcting several critical issues, though the process was delayed due to other priorities on the client’s part. Unfortunately, we received an urgent call from the client who had been compromised. As a result, the client was not operational, could not take orders or ship product, and was fielding phone calls from clients and the hackers. The client was down for weeks, encountering costs in the range of hundreds of thousands of dollars. They also had to pay staff salaries for work that wasn’t getting performed. They suffered immeasurable reputational risk when they informed their clients that they hadn’t adequately protected their data.

Many of our clients lean on cyber insurance as a backstop to protect them in case they are attacked. One of the first things cyber insurance companies will check on is what you have done to protect your assets and organization. Companies that haven’t proactively protected themselves may find that insurance companies will reduce coverage or even cancel the policy.

Outdated Legacy Applications and Hardware

For many organizations, there is an out-of-sight, out-of-mind approach to applications and hardware, meaning once it’s installed, it’s left in place (not being maintained and upgraded) until it breaks. We commonly find that legacy on-premises applications have not been updated in 5, 10, even 20 years, meaning they are lacking security, tax and accounting, and functionality updates. While it may seem fine to leave these older systems in place, staff are not modernizing or staying current with “acceptable” business practices, meaning they are embedded in practices that can be 20 or more years old.

Additionally, we often find older legacy hardware (servers, routers, firewalls, laptops, desktops) that are no longer supported and at risk for breaking, which will leave the organization without functional systems while the hardware is down. Or even worse, the hardware could be vulnerable to a cyber-hacker because of the vulnerability of older non-patched systems.

The cost of replacing older equipment or upgrading older applications may actually be much higher because of the need to replace both at the same time and a rushed modernization of legacy software

We have many clients at risk of being unable to find upgradeable software or programmers to support 20-year-old software of a highly customized system without documentation of what was done.

Poor Data Quality

Data is rapidly becoming the new oil. It powers AI, reports, dashboards, and executive decision-making. It lifts systems from a focus on getting products and services out the door to getting them out efficiently, and it gets the right products and services into the right client’s hands. Poor data quality leaves organizations at a competitive disadvantage and slows organizational responsiveness.

High-quality data combined with dashboards with drill-down capability and even the right analytics can shift organizational views from looking in the rear-view mirror (legacy reports) to focus a mile down the road due to the predictability of proper data and analytics.

One of our clients was using quality data and analytics to improve product commitment and delivery time. The data allowed them to commit to and deliver on specific delivery dates, which functioned as a competitive advantage and opened the floodgates to many new orders because clients could count on them.

How to Identify Hidden IT Risks That Are Costing Your Business

Start by looking for the telltale signs of IT risks:

• Not conducting regular cyber assessments
• Older software and hardware that haven’t been upgraded in a very long time
• Lack of forward-looking executive reports and an inability to drill down into real-time data

If you are experiencing any of these symptoms, it may be time for a professional “checkup” or assessment.

An IT assessment is a comprehensive evaluation of your organization’s IT environment. This process involves scrutinizing your IT organization, hardware, software, network infrastructure, data management practices, security protocols, budget and spend, and general IT operations. The goal is to identify vulnerabilities, inefficiencies, and potential threats that could jeopardize your business operations.

Conclusion

Uncovering hidden IT risks through comprehensive assessments is essential for protecting your business from costly disruptions and security breaches. By partnering with a strategic IT consulting firm, you can identify and mitigate these risks effectively, ensuring your IT infrastructure supports your business goals safely and efficiently. Don’t wait for a crisis to uncover these risks—take proactive steps now to secure your business’s future.