Canadian Businesses: Cost of Cybercrime Overtakes Physical Crime16 March 2006
More than 62 per cent of Canadian businesses believe that cybercrime is more costly to them than physical crime, reports a recent IBM survey of companies in the healthcare, financial, retail and manufacturing industries. The cost of cybercrime, these businesses report, results primarily from lost revenue, loss of current and prospective customers and loss of employee productivity.
Surveying 151 CIOs or other individuals qualified to answer questions about their company's IT practices, the IBM study reveals that 95 per cent of IT executives believe that organized criminal groups possessing technical sophistication are replacing lone hackers in the world of cybercrime. The threat from unprotected systems in developing countries is a growing challenge, according to more than 60 per cent of respondents. And, alarmingly, almost 70 per cent perceive that threats to corporate security are now coming from inside the organization.
These views come as a majority of respondents (67%) believe it is the joint responsibility of federal, provincial and local law enforcement agencies to help combat organized cybercrime. While just over half (57%) of Canadian businesses believe they are adequately safeguarded against organized cybercrime, 67 per cent believe that Canadian lawmakers could do more when it comes to cooperating with other governments.
"Canadian IT executives are making it very clear how seriously they take the cybercrime threat, both from internal and external sources," said Nicole Stampatori, national practice leader of security, identity and privacy at IBM Canada. "Paralleling their growing awareness of the impact of cybercrime on their business is the view that this is not a battle they can fight wholly on their own. The nature of crime is changing, and businesses, technology providers and law enforcement must work together to ensure the right safeguards are being put in place to securely operate in today's environment."
Taking Action
In light of the growing threat of cybercrime, 57 per cent percent of Canadian organizations believe they have adequately safeguarded themselves against organized cybercrime, but they are responding to the increased/changing threat of cybercrime in a number of ways:
- Upgrading virus software (74%);
- Upgrading their firewall (70%);
- Implementing intrusion detection/prevention technologies (62%); and
- Implementing vulnerability/patch management system on network (42%).
When asked which two initiatives were the most important to undertake over the course of the next year, IT business executives indicated upgrading their virus software (37%) and implementing intrusion detection/prevention technologies (34%) were of highest priority.
Global Comparison
IBM conducted the same survey in 16 additional countries to better gauge the attitudes regarding cybercrimes and their impact on international businesses. Both cyber-crime and physical crime are viewed as considerable threats to Canadian and international organizations. And, when it comes to cost impact, both groups agree that cyber-crime is more costly to their organizations than physical crime (62 per cent of Canadian and 58 per cent of international businesses).
However, while 57 per cent of Canadian businesses believe they have adequate safeguards in place to combat organized cyber-crime, their American counterparts are far more confident, with 83 per cent indicating they are prepared.
In combating cybercrime and the top two initiatives planned to be undertaken over the course of the next year, there are some slight differences between Canadian and international IT business executives. The top two initiatives for Canadian businesses are upgrading their virus software (37 per cent vs. 27 per cent of international businesses) and implementing intrusion detection/prevention technologies (34 per cent vs. 30 per cent of international businesses).
The Canadian business community had slightly more concerns than its US counterpart about the key costs associated with cybercrime. The loss of revenue was ranked as the highest key cost among Canadian businesses at 72 per cent, compared with 63 per cent for the United States. 67 per cent of Canadian businesses rank loss of current customers as a key cost to their bottom line, compared with only 56 per cent of American businesses.
Methodology: Braun Research, Inc. conducted this survey on behalf of IBM. A total of 151 telephone interviews were conducted with Canadian businesses in the healthcare, financial, retail and manufacturing industry sectors during January 2006 and 2851 international businesses in sixteen countries (China, UK, India, Russia, Poland, Czech Republic, Germany, Spain, Italy, France, Argentina, Brazil, Australia, Mexico, Japan, and the United States) during the period December 2005 to January 2006. Eligible respondents were at the CIO level, a VP or higher reporting directly into a CIO, or other individuals who were well-versed and qualified to answer questions about their company's IT practices. The survey was fielded at the 95 per cent confidence level with a margin of error of +/- 2 per cent for the global results and +/- 8 per cent for country specific results.
About IBM
IBM is the world's largest information technology company, with 80 years of leadership in helping businesses innovate. Drawing on resources from across IBM and key IBM Business Partners, IBM offers a wide range of services, solutions and technologies that enable customers, large and small, to take full advantage of the new era of on demand business. For more information about IBM, visit http://www.ibm.com.
For further information: Please Contact: Erik Van Drunen, Ketchum, for IBM Canada, (416) 544-4904, erik.vandrunen@ketchum.com; Sherry Boisvert, Ketchum, for IBM Canada, (416) 544-4911, sherry.boisvert@ketchum.com
Source: newswire
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