In the past few years, Americans have come to learn that security initiatives are expensive and, many times, unsuccessful. However, high cost security is more than a government issue, it is also an important business issue. In a digital economy, businesses must work hard to keep client and employee information safe and private. Unfortunately many businesses spend millions of dollars on security initiatives that never deliver the promised results.
Dr. Lawrence Gordon and Dr. Martin Loeb, professors at the Robert H. Smith School of Business and co-authors of Managing Cybersecurity Resources: A Cost-Benefit Analysis, tackled tough security questions that businesses face during a panel discussion at the Smith School on September 28, 2006. Mark Walsh, entrepreneur-in-residence at the Dingman Center for Entrepreneurship, moderated the discussion. Local business leaders attended and contributed their personal experiences to the discussion. Gordon, Ernst & Young Alumni Professor of Managerial Accounting and Information Assurance, began the panel discussion by explaining that he and Loeb, professor of accounting and information assurance and Deloitte & Touche LLP Faculty Fellow, wrote Managing Cybersecurity Resources because there was no other book on the market with a similar focus.
In their book the two economists address several myths regarding cybersecurity. They argue that not all security breaches significantly impact a business, but some breaches can ruin a company's reputation and ability to continue functioning. Gordon and Loeb also believe that most business leaders do not understand cybersecurity risk management or how information sharing affects cybersecurity. The professors describe the cost-benefit framework in their book as a solution to cybersecurity's high costs and management problems. However, Gordon stressed to attendees that they must correctly apply the numbers and risks that their business faces for the economic analysis to work properly.
This session of the Smith Leadership Series was sponsored by MorganFranklin, Smith Barney, Sprint and Blackboard. The series explains the practical application of management research produced at the University of Maryland's Robert H. Smith School of Business and allows business leaders to learn from the Smith School's world-class faculty. Series topics include globalization, technology, and entrepreneurship.
▓ Camille Hoff, MBA Candidate 2008, Smith Media Group