IT Risk Assessment - All You Need to Know

IT risk assessment helps organizations understand the potential risks and vulnerabilities associated with their IT systems, infrastructure, and data and develop strategies to manage those risks effectively. This will help enterprises secure their data from security threats such as cyberattacks, data breaches, and more.

Information technology (IT) is a dynamic field. The tools and technologies keep evolving with time. So whenever a new technology comes, it's essential to train the existing users about it to bring the best out of it.

Also, any shortfall must be addressed earliest to avoid affecting the organization's work. IT risk assessment ensures that all vulnerabilities and shortfalls in the organization are properly managed and addressed so that work doesn't hamper.  

A key advantage of IT risk assessment is that it helps IT teams gain visibility into current and emerging risks that may potentially affect the organization's operations, assets, and intellectual property to mitigate the security risks.

Furthermore, IT risk assessment is very important from a security perspective. It uncovers all vulnerabilities in the existing IT infrastructure and applications. Therefore, it helps to proactively identify and close all the security risks, which helps in preventing external and internal threats.

So before proceeding towards how to conduct IT risk assessment in your organizations, let's first understand what IT risk assessment is, its type, the benefits of implementing it, and 4 major components which will help you understand the topic better.

What Is IT Risk Assessment?  

IT Risk Assessment identifies and evaluates potential threats and vulnerabilities related to IT systems and infrastructure. The main objective of IT Risk Assessment is to understand the risks and their potential impact on an organization's IT operations, data, and business processes.

Furthermore, with the help of IT risk assessment, IT teams can develop strategies to mitigate security risks and reduce the likelihood and impact of IT-related incidents, protecting the organization's valuable assets and sensitive data from cyberattacks, data breaches, and other potential security threats.

Two Types Of IT Risk Assessment

IT risk assessment is qualitative and quantitative; the ultimate goal is to manage threats efficiently, but the approach and working methods differ.

Quantitative IT risk assessment involves assigning numerical values and calculations to various risk factors, such as likelihood, impact, and cost. It involves using statistical analysis and mathematical models to quantify the likelihood and potential impact of IT risks. This approach provides a more objective and measurable understanding of the potential impact of IT risks.

Qualitative IT risk assessment, on the other hand, involves assessing and analyzing IT risks based on subjective factors and expert judgment. It involves evaluating various risk factors based on their likelihood, impact, and urgency and ranking them based on the assessor's judgment. This approach provides a more subjective and less precise understanding of the potential impact of IT risks.

Quantitative IT risk assessment is typically used when there is a need for precise and measurable data, such as in financial or regulatory contexts.

Qualitative IT risk assessment, on the other hand, is used when data is limited or uncertain, such as in emerging or rapidly changing risk environments.

Overall, both quantitative and qualitative IT risk assessment approaches have their strengths and weaknesses, and the appropriate approach will depend on the specific situation and the organization's risk management objectives.

The 4 Major Components Of IT Risk Assessment

There are four key components involved in an IT risk assessment:

1. Threat: Any event that could harm assets or people act as a threat to the organization.  
2. Vulnerability: Any potential weak point in the organization's infrastructure could allow a threat to cause damage. For example, an ex-employee with access to the organization's applications or any resources in which sensitive data resides. This happens due to the absence of an efficient offboarding process in place.
3. Impact: The damage or loss that occurs in an organization whenever a vulnerability is exploited by a threat is known as the impact on the organization. For example, undiscovered SaaS applications give rise to shadow IT, which can become a potential cause of security risks.
4. Likelihood: It gives an idea about the probability of a threat. For example, you can categorize highly likely if something you expect happens several times in a year or specific time period.

Benefits of IT Risk Assessment

What can one expect from implementing IT risk assessment? Given below are a few benefits that will help you understand why it's crucial to focus on IT risk assessment in an organization.

• IT risk assessments help organizations identify potential security threats and vulnerabilities, allowing them to take proactive measures to mitigate these risks and strengthen their security posture.
• It provides valuable information related to emerging threats that help make informed decisions, and based on that, organizations can prioritize investments in cybersecurity and IT infrastructure.
• Many industries are subject to regulatory compliance requirements related to cybersecurity and data protection. IT risk assessments can help organizations meet these requirements and avoid potential fines and penalties.
• Furthermore, it helps organizations navigate security failures in their IT infrastructure, take proactive measures to prevent downtime and minimize the impact of any disruptions.
• Additionally, by identifying potential risks and vulnerabilities early on, organizations can avoid costly security breaches and IT disruptions. IT risk assessments can also help organizations make more informed decisions about cybersecurity and IT infrastructure investments, potentially leading to cost savings over time.

You might have got a clear idea of what IT risk assessment is and how it helps your organization prevent security threats. So let's move on and see how you can conduct an IT risk assessment.

How to Conduct IT Risk Assessment?

Before you start conducting an IT risk assessment, you need to figure out what needs to be secured, and then you can begin making strategies. However, before you spend a single penny of the budget or a minute of your time implementing a tool to reduce threat or risk, remember which threat you are addressing, what its priority is, and lastly, whether you are approaching it cost-effectively.

Here's how you can conduct an IT risk assessment.

1. Discover IT assets

IT assets include servers, firewalls, databases, intellectual properties, and more. It would help if you remembered that what you think is valuable as an IT team might not be the most beneficial for the organization. Hence, you need to work with management and users to list all the valuable assets in the business.  

For example, first, you need to discover all the assets within your organization that need to be protected, including hardware, software, and curial data, and create a list of all the assets and their locations.

You must be thinking, what is the need for it? This needs to be done because companies usually have a limited risk assessment budget. So you need to determine which one is more important from a business perspective. Then, you can segregate the assets by checking their monetary value, importance to the business, and legal standing.

It doesn't end here; you need to get the list approved by the management; once approved, then you can classify each asset as major, minor, or critical. So that you can implement the IT risk assessment for those IT assets which are more crucial for the business.

2. Navigate potential threats

Threat basically refers to potential events or actions that could harm an organization's information systems, data, or technology infrastructure. By identifying threats, enterprises can better understand their systems' potential risks and vulnerabilities, which is necessary for developing an effective risk management strategy.

Threat identification involves analyzing potential scenarios that could cause harm to the organization, such as cyberattacks, natural disasters, human error, and system failures.

For example, floods can cause severe damage to IT infrastructure, including servers, routers, and other networking equipment. Water damage can also result in critical data loss, leading to extended downtime and financial losses. Also, hurricanes and tornadoes can cause physical damage to buildings and IT equipment. In addition to direct physical damage, power outages resulting from these events can also impact IT operations.

Furthermore, another threat can be hardware failure that occurs in any IT equipment, including servers, storage devices, networking equipment, and personal computers. For instance, IT equipment generates heat; if it is not adequately cooled, it can overheat, leading to hardware failure. Also, processors, memory, and hard drives can wear out over time, leading to hardware failure.

3. Look for Vulnerabilities

Now you know what kind of threats can harm your enterprise, but looking for vulnerabilities is also essential. Otherwise, how will you get to know the organization's weaknesses and which asset the threat can impact?

Identifying vulnerabilities is a crucial aspect of IT risk assessment as it allows an organization to identify potential weaknesses in its IT infrastructure and systems that attackers could exploit.

Some common vulnerabilities can be weaknesses in software or hardware, poorly trained employees, or inadequate physical security.

Software vulnerabilities can include unpatched software, insecure configurations, or weak passwords. Hardware vulnerabilities include outdated or poorly maintained equipment. Also, poorly trained employees can be vulnerable, for instance, if one of them clicks on a suspicious link in phishing emails.

So, by identifying vulnerabilities before they are exploited, organizations can take steps to mitigate or eliminate the risks associated with those vulnerabilities, which helps to reduce the overall risk to the organization.

4. Understand & determine the likelihood of an incident

Determine the likelihood that each identified threat will occur and the potential impact it will create if it occurs. This will help prioritize which risks to focus on first. For example, a natural disaster like a hurricane may have a low likelihood of occurring but a high impact if it does occur. Conversely, a targeted cyber-attack may have a higher likelihood of occurring but a lower impact than a natural disaster.

5. Assess the impact of a threat

Assessing the impact of a threat helps IT teams develop appropriate risk response plans. For instance, let's say the impact of a threat is severe. In that case, IT teams may need to implement more extensive risk mitigation measures or develop a contingency plan if the risk event occurs.

Once you assess the impact of a threat, you need to identify the most critical risks to the organization. Next, prioritize the risks based on the likelihood and impact of each threat. This will help determine which risks should be addressed first.

Now the ultimate question: how will you tackle the security threats? You can develop risk management strategies to address the identified risks. This can include implementing technical controls such as firewalls, antivirus software, or encryption. It can also include administrative controls such as employee training or policies and procedures.

Physical controls such as access control systems or security cameras can also be implemented. The risk management strategies should be tailored to the specific risks and the organization's environment.

Additionally, implement risk management strategies and monitor their effectiveness. Review the risk assessment process regularly and adjust the risk management strategies as necessary. This will help ensure that the organization is adequately protected from security risks.

6. Document the outcome

How will you know what has occurred during IT risk assessment? Documentation is the answer; it records everything in one place for the organization.

Documenting the assessment results allows management to understand the assessment process and outcomes. In addition, it helps ensure that everyone involved is on the same page and can help promote transparency and accountability.

Furthermore, a documented IT risk assessment helps to communicate the findings and results to all relevant parties, including management, technical staff, and other stakeholders. Ensuring that everyone clearly understands the identified risks and the recommended risk mitigation strategies.

It also provides an assessment record to be referred to in the future. This can help to identify trends and track progress over time. It can also serve as a reference point for future assessments or audits.

Now you know how to conduct IT risk assessment. However, there is one more point that you need to consider, which is opting for an efficient tool that will be apt for conducting IT risk assessment for your organization. So one such tool is Zluri; let's look at it quickly.

How's Zluri The Best Fit For IT Risk Assessment?

What is Zluri? How does it work?

Zluri is an intelligent SaaS management platform that helps IT teams manage and secure their SaaS applications and crucial data. In addition, it provides many security capabilities that allow them to strengthen its security system and efficiently mitigate threats.

With Zluri, IT teams can gain complete visibility into the SaaS stack with the help of discovery methods, allowing you to eliminate shadow IT. Discovery methods that Zluri offers are SSO and IDP, finance and expense management systems, direct integration with apps, desktop agents (optional), and browser extensions (optional).

According to KuppingerCole's research and analysis, Zluri offers a single source of truth for managing all SaaS applications within an organization.

Zluri’s nine discovery methods

Once all the applications are discovered, IT teams analyzes their threat level, risk scores, compliance and more, and further categories those applications as managed, unmanaged, restricted, and needs review. 

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Additionally, Zluri navigates the application's threat and risk level and checks whether it meets regulatory compliance standards. Based on this, IT teams can decide whether to put it under critical applications.

You must be wondering, what about users? Zluri monitors user activity and identifies potential security threats, such as unusual login patterns, unusual file access, or data sharing outside the organization. So, to take action against it, the IT team restricts user access or puts them under critical users to protect the crucial data from cyberattacks.

For example, if a user has access to read, write, and modify, it can highly impact the data upon unauthorized attempt than a user having access to just read and write.

Zluri doesn't stop here; it enables organizations to automatically create and enforce policies that detect and remediate risky behaviors. For example, it can detect and remediate user accounts with weak passwords or detect and alert the IT team when a user attempts to share sensitive data outside the organization.

Furthermore, it identifies and scores potential risks in an organization's cloud environment. It assesses risk based on various factors such as user activity, data access patterns, and application usage, helping you mitigate the risks.

Additionally, it conducts periodic audits to track each step in the organization and gives a 360-degree view of the entire business process. This will help identify potential threats quickly so that you can take immediate action before those threats severely damage the organization.

You can book a demo immediately to learn more about Zluri and its other excellent capabilities. This tool will be a game changer for your organization. Try it yourself.