Cybersecurity Glossary: Security risk assessment

A security risk assessment can be performed on any application, function, or process within your organization. But no organization can realistically perform a risk assessment on everything. That’s why the first step is to develop an operational framework that fits the size, scope, and complexity of your organization. This involves identifying internal and external systems that are either critical to your operations, and/or that process, store, or transmit legally protected or sensitive data (such as financial, healthcare, credit card or passwords). Then you can create a risk assessment schedule based on criticality and information sensitivity.

The results give you a practical (and cost-effective) plan to protect assets and still maintain a balance of productivity and operational effectiveness. Once you determine your framework, you’re ready to embark on your individual risk assessments.

When going through the process it’s important to keep in mind that there are different categories of risk that may affect your organization.

  • Strategic risk is related to adverse business decisions, or the failure to implement appropriate business decisions in a manner that is consistent with the institution’s strategic goals.
  • Reputational risk is related to negative public opinion. Operational risk is related to loss resulting from inadequate or failed internal processes, people, and systems, or from external events.
  • Transactional risk is related to problems with service or product delivery.
  • Compliance risk is related to violations of laws, rules, or regulations, or from noncompliance with internal policies or procedures or business standards.

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