Last updated at Fri, 15 Sep 2023 14:39:12 GMT
This post is co-authored by Chris Henderson, Senior Director of Information Security at Datto, Inc.
Welcome back for the second and final of our blogs on the fallacies and biases that perpetuate ransomware risk for SMBs. In part one, we examined how flawed thinking and a sense of helplessness are obstacles to taking action against ransomware. In this final part, we will examine fallacies number 3 and 4: the ways SMBs often fail to “trust but verify” the security safety of their critical business partners, and how prior investments affect their forward-looking mitigation decisions.
3. Failing to trust but verify
“You seem like someone I can trust to help support and grow my business.”
When SMBs create business partnerships, we do so with a reasonable expectation that others will do the right things to keep both them and us safe. SMBs are effectively placing trust in strangers. As humans, we (often unconsciously) decide who to trust due to how they make us feel or whether they remind us of a past positive experience. Rarely have SMBs done a deep enough examination to determine if that level of trust is truly warranted, especially when it comes to protecting against ransomware.
We reasonably — but perhaps incorrectly — expect a few key things from these business partners, namely that they will:
- Be rational actors that can be relied on to make informed decisions that maximize benefits for us
- Exercise rational choice in our best interests
- Operate with the same level of due care that a reasonable, prudent person would use under the same or similar circumstances, in decisions that affect our business – akin to a fiduciary
Rational actor model
According to an economic theory, a rational actor maximizes benefits for themselves first and will exercise rational choice that determines whether an option is right for themselves. That begs the question: To what extent do SMBs understand if business objectives are aligned such that what is right for their business partners’ cyber protection is also right for them? In the SMB space, too often the answer is based on trust alone and not on any sort of verification, or what mature security programs call third-party due diligence.
If I harm you, I harm myself
Increasingly, ransomware attacks are relying on our business relationships (a.k.a. supply chains) to facilitate attacks on targets. End targets may be meticulously selected, but they could instead be targets of opportunity, and sometimes they are even impacted as collateral damage. In any case, in this ransomware environment, it is critical for SMBs to reassess the level of trust they place in their business partners, as their cyber posture is now part of yours. You share the risk.
Trust is a critical component of business relationships, but trust in a business partner's security must be verified upon establishment of the relationship and reaffirmed periodically thereafter. It is a reasonable expectation that, given this ransomware environment, your business partners will be able to prove that they take both their and your protection as being in your mutual best interests. They must be able to speak to and demonstrate how they work toward that objective.
Acknowledge and act
Trust is no longer enough — SMBs have to verify. Unfortunately, there is no one-size-fits-all process for diligence, but a good place to start is with a serious conversation about your business partners’ attitudes, beliefs, current readiness, and their investments in cyber resilience, ransomware prevention, and recovery. During that conversation, ask a few key questions:
- Do you have cyber insurance coverage for a ransomware incident that affects both you and your customers? Tip: Ask them to provide you proof of coverage.
- What cybersecurity program framework do you follow, and to what extent have you accomplished operating effectiveness against that framework? Tip: Ask to see materials from audits or assessments as evidence.
- Has your security posture been validated by an independent third party? Tip: Ask to see materials from audits or assessments as evidence.
- When was the last time you, or a customer of yours, suffered a cybersecurity incident, and how did you respond? Tip: Ask for a reference from a customer they’ve helped recover from a ransomware incident.
4. “We can’t turn back now; we’ve come too far”
“We have already spent so much time and made significant investments in IT solutions to achieve our business objectives. It wouldn’t make sense at this point to abandon our solutions, given what we’ve already invested.”
Ransomware threat actors seek businesses whose IT solutions — when improperly developed, deployed, configured, or maintained — make compromise and infection easy. Such solutions are currently a primary access vector for ransomware, as they can be difficult to retrofit security into. When that happens, we are faced with a decision to migrate platforms, which can be costly and disruptive.
This decision point is one of the most difficult for SMBs, as it’s very easy to fall into a sunk cost fallacy — the tendency to follow through on an endeavor if we’ve already invested time, effort, or money into it, whether or not the current costs outweigh the benefits.
It’s easy to look backward at all the work done to get an IT solution to this point and exceedingly difficult to accept a large part of that investment as a sunk cost. The reality is that it doesn’t matter how much time has been invested in IT solutions. If security is not a core feature of the solution, then the long-term risk to an SMB’s business is greater than any sunk cost.
Acknowledge and act
Sunk costs burn because they feel like a failure — knowing what we know now, we should have made a different decision. New information is always presenting itself, and the security landscape is changing constantly around us. It’s impossible to foresee every shift, so our best defense is to remain agile and pivot when and as necessary. Acknowledge that there will be sunk costs on this journey, and allowing those to stand in the way of reasonable action is the real failure.
“There’s a brighter tomorrow that’s just down the road. Do not look back; you are not going that way” - Mary Engelbreit
Realizing your SMB has real cyber risk exposure to ransomware requires overcoming a series of logical fallacies and cognitive biases. Once you understand and accept that reality, it's imperative not to buy into learned helplessness, because you need not be a victim. An SMB’s size and agility can be an advantage.
From here, re-evaluate your business partnerships and level of trust when it comes to cybersecurity. Be willing to make decisions that accept prior investments may just be sunk cost, but that the benefits of change to become more cyber resilient outweigh the risks of not changing in the long run.
- 4 Fallacies That Keep SMBs Vulnerable to Ransomware, Pt. 1
- Cybercriminals’ Recruiting Effort Highlights Need for Proper User Access Controls
- How Ransomware Is Changing US Federal Policy
- Is the Internet of Things the Next Ransomware Target?