Small and medium-sized businesses in the Philippines are exposed, under attack, and more worried about cybersecurity threats than before, a new study by Cisco shows.
According to the study, 57% SMBs in Philippines suffered a cyber incident in the past year. As a result of these incidents, 73% lost customer information to the hands of malicious actors.
This is making SMBs more apprehensive about cybersecurity risks, with 82% saying they are more worried about cybersecurity now than they were 12 months ago, and 89% saying they feel exposed to cyber threats. However, SMBs in Philippines are not giving up. In fact, the study highlights that they are taking strategic measures like carrying out simulation exercises to improve their cybersecurity posture.
Titled Cybersecurity for SMBs: Asia Pacific Businesses Prepare for Digital Defense, the study is based on an independent, double-blinded survey of over 3,700 business and IT leaders with cybersecurity responsibilities across 14 markets in Asia Pacific, including 158 respondents in Philippines. The survey highlighted that SMBs saw a myriad of ways in which attackers tried to infiltrate their systems. Malware attacks, which affected 81% of SMBs in Philippines, topped the charts, followed by phishing, with 78% saying they experienced such attacks in the past year.
Nearly one in two (49%) SMBs in Philippines that suffered a cyber-attack highlighted cybersecurity solutions not being adequate to detect or prevent the attack as the number one reason for these incidents. Meanwhile, 13% attributed not having cybersecurity solutions in place as the top factor.
These incidents are having a tangible impact on business. Twenty-eight percent of SMBs in Philippines that suffered cyber incidents in the past 12 months said these cost the business US$500,000 or more, with 10% saying that the cost was US$1 million or more.
“Over the past 18 months, SMBs have leveraged technology to continue to operate and serve their customers even as they tackled the implications of the pandemic. This has seen an acceleration in digitalization of SMBs across Philippines. As SMBs become more digital, they also become a more attractive a target for malicious actors, not least because digitalized businesses have an expanded attach surface that hackers can target. In addition, digitalized SMBs generate more data, which the malicious actors put a high price on. All of this is fueling a critical need for them to invest in solutions and capabilities to ensure they are safeguarding themselves on the cybersecurity front,” said Robin Llamas, Officer in-charge, Managing Director, Cisco Philippines.
Besides the loss of customer data, SMBs in Philippines that suffered a cyber incident also lost employee data (66%), sensitive business information (66%), internal emails (56%), financial information (53%), and intellectual property (53%). In addition, 65% admitted it had a negative impact on their reputation.
Disruptions caused by cyber incidents can have serious implications for SMBs. Sixteen percent SMBs in Philippines said that even a downtime of less than an hour results in severe operational disruption, while 28% said a downtime of between 1 to 2 hours can cause the same. In addition, 15% said a downtime of even less than an hour would result in severe impact on revenue, while 27% said a downtime between 1 to 2 hours would result in the same. Further, 16% said a downtime of one day would result in a permanent closure of their organization.
The scale of the challenge is highlighted by the fact that only 9% of respondents in Philippines said they were able to detect a cyber incident within an hour. The number of those that were able to remediate a cyber incident within an hour was also the same.
“We are living in a world where customers seek instant gratification. They no longer have the patience for lengthy downtimes. It is critical for SMBs to be able to detect, investigate, and block or remediate any cyber incident in the shortest time possible. To be able to do that, they need solutions that are easy to deploy and use, integrate well with each other, and help them automate capabilities like detection, blocking, and remediation of cyber incidents. In addition, they need clear visibility across their entire userbase and IT infrastructure including their cloud and ‘as a service’ deployments, and take a platform approach to cybersecurity,” said Juan Huat Koo, Director Cybersecurity, Cisco ASEAN
Conquering Fear with Preparedness
Cisco’s study found that while SMBs in Philippines are more worried about cybersecurity risks and challenges, they are also taking a planned approach to understand and improve their cybersecurity posture through strategic initiatives. According to the study, 77% of Philippines’ SMBs have completed scenario planning and/or simulations for potential cybersecurity incidents in the past 12 months
Ninety-five percent of respondents who completed scenario planning and/or simulations uncovered weak points or issues in their cyber defenses. Of those that identified weaknesses, 97% said they were able to detect an attack but did not have the right technologies to block it or mitigate its impact. 96% said they had too many technologies and struggled to integrate them together, and 94% said they discovered that they did not have clear processes in place on how to respond to a cyber-attack.
SMBs are also increasingly aware of where their biggest cyber threats come from. The research highlighted that phishing (50% ranked #1) is seen as the top threat by SMBs in Philippines. Other top threats to overall security include targeted attacks by malicious actors (20% ranked #1), and unsecured personal devices of employees (17% ranked #1).
The good news is there are generally strong levels of investment by SMBs in cybersecurity. The study highlighted that 82% of Philippines’ SMBs have increased their investment in cybersecurity solutions since the start of the pandemic, with 37% increasing investment by more than 5%. SMBs are also increasing their investments in areas like compliance or monitoring tools, talent, training, and insurance, suggesting a strong understanding of the need for a multi-faceted and integrated approach to building a strong cyber posture.
“Cybersecurity is evolving rapidly. This is being driven by trends like the expanding attack surface, move to multi-cloud, rise of hybrid work, as well as new security requirements and regulations. As they embark on their digitalization journeys, SMBs have a unique opportunity to lay the right foundation for their security posture and build their business on a strong foundation of trust,” said Kerry Singleton, Managing Director, Cybersecurity, Asia Pacific, Japan, China, Cisco.
The report highlights five recommendations that organizations of all sizes can employ to improve their cybersecurity posture given the ever-changing landscape. They are: having frequent discussions with senior leaders and all stakeholders, taking a simplified, integrated approach to cybersecurity, staying prepared through conducting real-world simulations, training and educating employees, and working with the right technology partner.