With 2017's holiday season right around the corner, you're busy taking a serious look at your operations, discussing strategies and making plans on how to best prepare your business to capitalize on the holiday sales rush.
One key area of focus worthy of your attention should be security, especially after the series of cyber attacks and data breaches over the years, including the recent WannaCry ransomware attack.
If security fears are keeping you up at night, having the knowledge of your actual risks, what they pose to your organization, and most importantly, understanding how to best mitigate your risk will move you from fear into empowerment and action.
On-Premise Versus the Cloud and Fear Versus Fact
To streamline back office operations to support omnichannel and real time accounting and inventory, merchants are moving their on-premise, legacy management systems to cloud-based retail platforms.
This is happening across all industries. Of the 196 IT managers and leaders surveyed by Computerworld, 79 percent have a cloud migration project underway or planned.
The myth that on-premise systems are more secure than the cloud is also unraveling.
Because many legacy systems were designed before the growth in cyber attacks took flight, keeping them secure has become more difficult and expensive than today’s cloud-based platforms with integrated multi-layered security technologies.
According to cloud security expert and Senior Vice President at Cloud Technology Partners, David Linthicum: “Legacy systems are more difficult to keep updated because enterprises may have to go around to several hundred thousand platforms to check and update security systems. It’s easier for legacy systems to fall behind.”
The Cost of Cyber Attacks and Staying Ahead of the Security Game
According to Cisco’s 2017 Annual Cybersecurity report, almost one in three retailers have incurred revenue losses as a result of a cyber attack. The report cites that targeted security attacks is the number one risk facing retail organizations.
According to Bloomberg, data breaches in 2016 reached a record number of 1,093, an increase of 40 percent over 2015. IDC also states that security-related investment in 2016 reached $73.7 billion and is expected to grow to $90 billion in 2018.
The Retail Industry Leaders Association, in an effort to provide ongoing research, analysis, and education on data breaches and potential cyber threats, launched the Retail Cyber Intelligence Sharing Center (R-CISC) in 2014. Today, its membership base of over 50 retailers, which represent over $1 trillion in annual revenue, collectively share intelligence and receive insights from law enforcement and security experts.
In February of this year, R-CISC formed a strategic alliance with LexisNexis Risk Solutions. This collaboration unites two key service areas for protecting retail businesses against costly fraud activities and ransomware-like attacks. R-CISC’s end-to-end encryption strategies, fraud detection and monitoring capabilities are now aligned with LexisNexis’ Fraud Defense Network, which brings retailers the fraud fighting capabilities and intelligence from across finance, retail, telecommunications, insurance, government, law enforcement and healthcare industries.
Artificial intelligence and machine learning are also becoming integral cybersecurity tools. Just this month, First Data, which powered $2.2 trillion dollars of transactions around the world in 2016, introduced Fraud Detect that utilizes these advanced technologies to analyze vast datasets far faster than humans, identifying fraud and potential chargebacks while incorporating data from the Dark Web encrypted network.
What Can You, the Retailer, Do Today?
According to the Identity Theft Resource Center, 56 percent of all data breaches in 2016 occurred after an employee was duped into clicking a link within an email that enabled a hacker to install a piece of malware into the network. For the record, this is also how the Target data breach occurred.
This is preventable today by simply educating your employees on how phishing attacks work and training them to NEVER click on suspicious links. It’s also crucial to keep your computer systems updated.
If you’re still running your back office operation on an on-premise legacy system or on spreadsheets, consider the technical, back office operations, and security advantages of a cloud-based retail management platform. It will not only be able to keep up with the lightning-speed evolution of our ecommerce world, it will protect your business from today’s retail threats, with security being just one of them.
This article originally appeared in Retail Technology.