Cyberattacks on small businesses are increasing. And security risks are compounded by the fact that networks keep growing, with new devices and higher volumes of data added every day.
To address the higher risk, small businesses must increase their IT security budgets. But the IT department finds itself competing for budget with HR, marketing, and sales teams. In fact, 45 percent of cybersecurity professionals cite lack of budget as an obstacle to improving cybersecurity.
Another challenge faced by small businesses is how to best stretch their IT security budgets without leaving any gaps. For example, if you dedicate the bulk of it only to endpoint security or antivirus software licenses, you leave your networks and data at the mercy of hackers.
Small businesses must set aside a dedicated IT security budget that covers key elements such as endpoint protection, network security, and employee awareness training to minimize the risk of cyberattacks and their consequences—which could include paying out millions in clean-up costs and fines.
This article discusses the key IT security tools you must budget for as well as provides a helpful list of the average costs of different types of cybersecurity software. You can also download and use our template to roughly project what your cybersecurity expenses should be for 2019.
A dedicated IT security budget helps build a stronger cyberdefense strategy
Creating a separate budget for IT security can add to the burden of a small business’s many to-do lists.
But, it’s worth the effort because it helps you better optimize your allocated funds and identify the cybersecurity areas where you need to increase spending and the areas of defense where you are already strong.
IT security budgets serve many purposes and provide many benefits. Here, we discuss some of the main goals and benefits of keeping a separate IT security budget.
Primary benefits of a dedicated IT security budget
Ensure adequate fund allocation for cybersecurity. Marking out separate budgets for IT security ensures that a specific amount will be used to fund your cybersecurity defenses and for no other purpose. A separate cybersecurity budget ensures that funds can’t be siphoned off for other IT requirements.
Track security-related expenditures accurately. According to Gartner, most businesses do not have cost accounting systems that break down IT security as a separate item or cost center. Instead, since security-relevant processes are often carried out by personnel not directly associated with the IT team (e.g., HR team spending on security training), they are often lumped into different expense lines.
Having your own IT security budget will help you track all your security-related expenditures—software, hardware, patches, data clean-up, and recovery—under one line item. This will help you better track your security spending and identify areas that need more or less investment.
Support security audits and estimate ROI. Security budgets help track various planned and unplanned security-related expenditures. This makes conducting security audits easier, since you have a record of all your security spending. It also helps demonstrate ROI as well as identify under-invested areas that you need to budget for in the coming years.
10 must-have components of your small business IT security budget
You must budget for the minimum-required cybersecurity technologies to keep your business safe.
Core solutions such as endpoint security, vulnerability management, user access controls, and disaster recovery are must-have security elements. On the other hand, incident response management, risk assessment, and business continuity management programs are desirable but not essential for small businesses, considering their smaller scale of operations and lower data volumes.
Here we discuss 10 must-have security technology applications that small businesses must implement along with the software features to look for.
Small business owners must ensure that their business doesn’t operate without these essential security controls, or they risk losing money and brand reputation and even potentially shutting down their business because of cyberattacks.
1. Endpoint protection: Involves protecting the perimeters of your network, including laptops, desktops, mobile devices, and other connected devices. Endpoint protection software suites offer a wide range of properties including antivirus, firewalls, centralized controls, and remote monitoring.
Key features: Device detection, reports, alerts, incident investigation, third-party integrations.
2. Mobile security: Refers to efforts to secure data on mobile devices including laptops, tablets, and smart watches. Mobile security software identifies vulnerabilities and detects malware threats to mobile devices and ensures only authorized persons have access to the data on devices through passwords, screen locks, and other forms of authentication, such as biometrics.
Key features: Wi-Fi security, malware-blocker, web protection, adware alerts.
3. Network security: Covers a broad range of areas including network monitoring, firewalls to filter traffic, anti-malware applications, and data backup and recovery. Network security software primarily helps keep the network and all data within it secure.
Key features: Real-time monitoring, anti-malware, network mapping, network troubleshooting.
4. Document storage: Helps to securely store and manage digitized records and files. You can either opt for cloud-based storage or on-premises storage software.
Key features: Version control, document management, archiving, editing.
5. Access management: According to a Verizon report, misuse of accounts is a common method for launching cyberattacks. Identity and access management software tools make it possible to manage user accounts, set user access controls, fix privilege rights, and restrict unauthorized user access and misuse of employee or partner accounts.
Key features: Authentication, authorization, secure login, centralized dashboard to monitor access controls.
6. Patch management: Patches are simply updates to your software. According to Fortinet research, 90 percent of security hacks in 2016 could have been prevented if users had installed patches on time. Patch management software identifies vulnerable systems, alerts users about the patch, and tests how effective the patch is. You can also set which patches are critical and which ones are non-essential for your business using the control/settings feature.
Key features: Centralized interface to manage vulnerabilities, alerts, automated updates, remote management system.
7. Vulnerability management: Vulnerabilities are weaknesses in your IT systems that hackers are most likely to exploit, such as unpatched applications, old passwords, etc. Vulnerability management tools identify vulnerabilities such as SQL injection, cross-site scripting, and plug-in errors in websites and web applications and suggest remediation methods on how to correct these vulnerabilities.
Key features: Website/application testing, remediation reporting, real-time scanning, risk scores.
8. Security awareness: Creating awareness among employees about cybersecurity best practices is crucial, since 77 percent of data breaches are caused by human error. Computer-based security awareness training software helps to train employees on different security policies and best practices such as identifying phishing emails, maintaining data integrity, data confidentiality, privacy, and more.
Key features: Reporting, simulated attacks, customized security awareness programs, training library.
9. Security audit: Audit and compliance assessment software are important tools to ensure that your business follows various federal and industry regulations. Security audit tools also help you detect configuration changes, unauthorized user activity, and non-compliant networks. Security audit software centralizes intelligence gathering, tracks network device change management, and maintains audit trails.
Key features: Compliance management, audit trails, license management, log management and analysis.
10. Disaster recovery: Small businesses can’t afford to have downtime because even one minute of downtime can cost between $137 and $427. Disaster recovery helps businesses quickly failover to their backup systems and data in case of an emergency and reduce downtime. Disaster recovery management involves keeping a copy of all critical systems and data and moving over to using them to quickly resume operations after a disaster strikes.
Key features: Bare-metal recovery, scalable data storage, support multiple data types, data protection, failover testing.
Don’t let this list of must-have security technologies overwhelm you and leave you worried about the potential costs. There are a number of integrated cybersecurity tools on the market that offer suite solutions covering a wide range of features including endpoint protection, data backup, network security, and more.
Suite solutions can save you on costs as well as help you avoid the hassle of having to manage multiple software and vendors. You can also outsource your security functions to managed service providers who provide end-to-end security services.
How much should your IT security budget be?
Small businesses should spend at least 4 percent of their IT budget on cybersecurity.
Deciding which areas of cybersecurity to invest in is one part of the challenge when implementing an IT security budget. The second part of the challenge lies in determining what the optimal value of your IT budget is.
IT security budget requirements will vary based on your industry and how mature your security structure is. According to Gartner, businesses should be spending between 4 and 7 percent of their IT budgets on IT security: lower in the range if they have mature systems and higher if they are at risk and do not have many security controls.
Average costs of key IT security software
Knowing the average costs of different cybersecurity software applications can help you plan your budget better. Identify key security tools needed in your business, and use the price chart below to estimate how much you’ll most likely have to spend on security applications.
|Software||Key functions||Average cost|
|Network security software||
|Internet security software||
Use free trials offered by different security software vendors before you choose the best software for your business. You should also check out some of the free plans or free tools that provide cybersecurity capabilities. Using free tools that offer capabilities needed by your business helps save costs.
Other essential cybersecurity elements you must budget for
In addition to software tools, there are other cybersecurity expenses that you may incur. These include:
Cyber insurance covers your company against financial losses incurred as a result of data loss from cyberattacks, network outage, or service interruption. It helps you mitigate the costs of cyber investigation and quickly recover from cyberattacks.
Cyber insurance providers offer different types of policies—those that cover against losses suffered by the insured as well as plans that also cover losses of third-party managed services.
Policy premiums differ based on the type of policy, your risk exposure, and your security posture. Most small business cyber insurance annual premiums range between $1,000 and $7,500.
Investing in cybersecurity training will raise employee awareness of cyber threats and the best practices for tackling them.
You can either partner with a third-party security trainer, use computer-based security training software, or build your own materials to create a security training plan for your employees.
Often small businesses do not have in-house expertise to plan their cybersecurity strategy and to identify and prevent cyberattacks. You may need to employ the services of a trained cybersecurity professional to fix your vulnerabilities.
You can liaise with third-party cybersecurity consultants on a case-by-case basis or enter into service agreements for a year or more. The fee charged by consultants will vary based on the services rendered, the size of your organization, complexity of the task, and more. Cybersecurity experts, on an average, charge $3,000 – $10,000 a day for their services.
Cybersecurity talent is in great demand, and you may eventually need to hire expert in-house IT security professionals as your business grows. If you plan to build your own cybersecurity team, you’ll incur hiring and manpower costs. Cybersecurity salaries in metro cities in the U.S. are in the range of $132,000 to $380,000 per year.
Next steps: Download our IT security budget template
Budgeting for cybersecurity essentials is important to ensure that you have a fixed sum set aside to meet your security requirements. This helps to ensure that your funds allocated for security applications do not get misused.
Audit your security systems before you prepare your cybersecurity budget for the year. Check what software tools you already have in place, what items require an upgrade, and what you need to purchase.
Download our security budget template to record what you need for the year and fix the expenditure. Learn whether you are spending less, more, or the same as your peers.
Click on the image or on “download” above to download an Excel version of our IT security budget template
Visit GetApp’s directory on IT security for a long list of software applications offering various capabilities—antivirus, identity management, SIEM, encryption, and more.
Check out GetApp’s Security Lab to tinker with more IT security templates, free tools, and cybersecurity best practice ideas.
Read on to discover:
- Build an effective security awareness training plan: 3 free tools
- A security assessment template for small businesses: Evaluate your IT security
- Small business tech guide for an effective business continuity strategy
- How to prevent DDoS attacks using blockchain—and 6 more strategies
- 5 tools to improve network performance and prevent cyberattacks
Note: These prices are indicative and will vary from vendor to vendor. Talk to your vendor to thoroughly understand its pricing structure and features offered before you make a purchase decision.