I am honored and humbled to have been given the opportunity to discuss practices to address cyber risks at the 2021 STRONGER conference hosted by CyberSaint Security (Sep 28, online). I will discuss the building blocks to quantify and communicate risks to protect IT assets, processes, and services. Thanks to Ethan Bresnahan for the flawless preparation of the event. You are welcome to register here https://lnkd.in/eitKYDsX #cybersecurity #security #datasecurity #infosec #riskmanagement #ciso #stronger2021

1. Building the
blocks to
quantify
cyber risks
Prof. Hernan Huwyler, MBA CPA
#STRONGER2021

2. 01
Data to
performance
Business impact
assessments
Statistical
analysis
02
03
04
05
06
Risk modeling
Quantification
Communication

3. Data to Performance
You need to obtain
good data to quantify
your cyber security
risks
Good data will help you
to decide priorities and
investments today to
maximize the
performance tomorrow

4. Business impact assessment
You need to assess the financial
impact on the confidentiality,
integrity and availability
objectives if a cyber risk
materializes
The financial impact should be
broken down into number of
records, affected parties and
downtime hours

5. Business impact assessment
Confidentiality Integrity Availability
IT Asset
IT Process
IT Service
Record
.
Cost
Record
.
Cost
Downtime
.
Cost
You can model multiple scenarios with their own distribution
Triangular Lognormal Discrete
Uniform Paretto
Normal

6. Business impact assessment
Profitability losses of potential
and current clients
Regulatory fines
IP and competitive losses
Cost of changing the CISO
Secondary
impact
Downtime costs
Notification and response
costs
Damage on IT assets
Contractual penalties
Fraud losses
Primary
impact

7. Statistical analysis
You can use external data
by adjusting significant
variances between
industries, geographies,
organization sizes, and
business models for your
organization

8. Statistical analysis
Threat attacks statistics
• Budget vs. actual by project
• Incident database
• Fraud and social engineering
• Penetration testing findings
• Discovered security
vulnerabilities
• Malware logs

9. Statistical analysis
Threat attacks statistics
• KPIs for SLAs and outsourcing
contracts
• Ongoing due diligence results
• Lost and early disposed IT
assets
• Maintenance analysis

10. Stadistical analysis
Threat attacks statistics
• Data loss prevention logs
• Help desk analysis on IT
issues
• API gateway protection logs

11. Model backtesting
You can measure the
impact of risk
incidents and compare
plans against actual
outcomes to improve
your risk data and use
regression‐based
methods

12. Quantification

13. Risk modeling
Prevent data
coctaiks
Objective
centric
Template in
native MS Excel
Simple
Address
multiple
scenerarios
Uncertainty
Compare with cyber
insurance,
investments and
control costs
Decision-
centric

14. Scoring and data cocktails
If you assess cyber risks using
scores or data cocktails with
useless formulas for inherent risks,
general data and control efficiency
scores disconnected from the
concrete objectives for the IT
assets, you are just wasting time
and inciting wrong decision making

15. Monte Carlo Simulation
Min Max
Confidence Interval
Loss USD
Nr
Cases

16. Monte Carlo Simulation
Confidence Interval Standard Error
80% 2.56
90% 3.29
95% 3.92
99% 5.15
z*-value*2
2
Ln (Max) + Ln (Min)
Standard Error
P(A), μ = , σ =
Ln
Single
Loss USD
=
Ln (Max) - Ln (Min)
=LOGNORM.INV(RAND(),(LN(Max)+LN(Min))/2,(LN( Max)-LN(Min))/standard error),0)

17. Monte Carlo Simulation
Single Loss
Estimation Tool
https://shorturl.at/iCFHI

18. Communicating

19. Heat maps and risk matrices
If you assess and
communicate your
cyber risks with
colors and
adjectives, you are
just committing
malpractice and
creating liabilities for
your organization

20. Loss exceedance curve
Loss USD
0.001 0.1 10
0%
25%
50%
75%
100%
Loss
chance
5%
95%
.001 .01 .1 1 10 100

21. Tornado chart
Expected cost USD
Error in use
Ransomware
Misconfiguration
Phishing
-50 0 50 100

22. Histogram
Expected cost USD
0
10%
20%
Density
0 50 100 200 300

23. Let´s connect
@hewyler
/hernanwyler
mydailyexecutive.blogspot.com