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Risk Management And Assessment - Coggle Diagram
Risk Management And Assessment
Risk Management
Definition:
The process of identifying, assessing, prioritizing, and treating risks.
Importance:
Helps in mitigating potential losses and ensures the stability and security of the organization.
Risk Assessment
Involves evaluating risks to determine their potential impact and likelihood.
Key Steps:
Asset Identification
Threat Identification
Vulnerability Identification
Risk Analysis
Likelihood Determination
Consequence Determination
Resultant Risk Evaluation
Controls and Risk Treatment
Risk Analysis Approaches
Baseline Approach:
Uses industry best practices; suitable for small organizations.
Informal Approach:
Pragmatic risk analysis leveraging the analyst's expertise; suitable for small to medium-sized organizations.
Formal Approach:
Comprehensive and structured; best for large organizations with critical IT systems.
Combined Approach:
Incorporates elements of the other approaches for optimal resource use.
Risk Treatment Alternatives
Risk Acceptance:
Accepting the risk when treatment is not cost-effective.
Risk Avoidance:
Avoiding activities that pose significant risks.
Risk Transferal:
Sharing the risk with third parties, e.g., insurance.
Reduce Consequence:
Implementing measures to reduce the impact of risks.
Reduce Likelihood:
Implementing controls to lower the chance of risk occurrence.
Detailed Risk Analysis Process
Asset Identification
Identify all significant assets (tangible and intangible) that need protection.
Consult with personnel to identify key assets and their values.
Threat Identification
Determine who or what could harm each asset and how it could occur.
Consider threats that impact confidentiality, integrity, availability, accountability, and authenticity.
Vulnerability Identification
Identify weaknesses in IT systems or processes that could be exploited.
Use standards and checklists to ensure comprehensive vulnerability identification.
Analyze Risks
Specify the likelihood and consequence of each threat.
Use qualitative ratings to derive overall risk ratings.
Likelihood and Consequence Determination
Likelihood:
Probability of a threat materializing.
Consequence:
Severity of the impact if the threat occurs.
Use historical data, threat intelligence, and current security controls to assess these factors.
Determine Resultant Risk
Use a risk matrix to map likelihood and consequence to a risk level.
Document in a risk register and evaluate for treatment prioritization.
Controls and Risk Treatment
Decide on appropriate treatment options based on risk levels and organizational priorities.
Consider cost-effectiveness and potential impact when selecting controls.
Risk Assessment Computations
Single Loss Expectancy (SLE)
Formula:
SLE = AV × EF
AV (Asset Value):
The estimated value of the asset.
EF (Exposure Factor):
The percentage of the asset lost in the event of a specific threat.
Annualized Rate of Occurrence (ARO)
Definition:
The estimated frequency of a specific threat occurring within a year.
Example:
If an event is expected to occur once in 20 years, the ARO is 1/20 = 0.05
Annualized Loss Expectancy (ALE)
Formula:
ALE = SLE x ARO
Definition:
The annual expected loss from a specific threat.
Common Assets and Associated Threats/Vulnerabilities
Example Assets
Database Servers
Function:
Store and manage critical data.
Importance:
Ensures data integrity, availability, and confidentiality.
Network Infrastructure
Function:
Facilitates communication and data transfer within the organization.
Importance:
Supports business operations and connectivity.
Workstations and Laptops
Function:
Used by employees for daily tasks.
Importance:
Critical for productivity and day-to-day operations.
Email Systems
Function:
Communication within and outside the organization.
Importance:
Essential for business communication and documentation.
Financial Systems
Function:
Manages financial transactions and records.
Importance:
Critical for financial management and compliance.
Example Threats/Vulnerabilities
Hacking
Unauthorized access to systems or data.
Data breaches, financial loss, and reputational damage.
Malware
Malicious software designed to damage or disrupt systems.
Data loss, system downtime, and compromised data integrity.
Phishing
Fraudulent attempts to obtain sensitive information.
Unauthorized access, financial loss, and data breaches
Insider Threats
Threats from employees or other insiders with access to the system.
Data theft, sabotage, and unauthorized access.
Physical Theft
Theft of physical assets such as laptops or storage devices.
Loss of sensitive data and financial loss.