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Posted July 28, 2022
Dean Maloney, Business Intelligence Manager, GreyCastle Security
2022’s average cost of a data breach of $4.35 million represents a 2.6% increase from $4.24 million in 2021 and an average cost increase of 12.7% from $3.86 million over the last two years. Some factors impacting the increase are the frequency and complexity of attacks as well as the after-effects of breaches which linger long after the initial breach occurs. Nearly 50% of breach costs are incurred more than a year after the incident.
Another finding noted in this report is 60% of the organizations studied, raised the price of their products and services in response to a breach. This coming at a time when the costs of goods and services are already increasing due to inflation and supply chain issues.
According to the report, 83% of organizations studied have experienced more than one data breach, and just 17% stated this was their first data breach.
Having either an in-house or outsourced Incident Response team with a regularly tested incident response plan continued to mitigate data breach costs in 2022. The average cost savings in organizations with a team and a plan vs. those without was $2.66 million.
The average cost of a data breach for critical infrastructure was $4.82 million, 11% higher than the global average. Critical infrastructure organizations include those in communication, education, energy, financial services, healthcare, industrial, technology, and public sector. A large contributor to the rise is almost 80% of critical infrastructure organizations studied don’t adopt zero trust strategies.
Breaches at organizations with fully deployed security AI and automated security response, cost on average $3.05 million less than breaches at organizations without. In fact, security AI and automation represent the largest cost savings in the study. The research shows that companies with fully deployed security AI and automation can identify and contain a breach 74 days shorter than companies without.
Similar to 2021, the use of stolen or compromised credentials remains the most common cause of a data breach. In the 2022 study, stolen or compromised credentials represent 19% of breaches. These breaches result in an average cost of $4.5 million and have the longest breach lifecycle, 327 days to identify and contain.
When remote working was a factor in causing the breach, costs were an average of $1 million greater than breaches where remote working was not a factor. Remote work-related breaches cost on average about $600,000 more compared to the global average.
45% of the breaches in the study occurred in the cloud. Although the average cost of a data breach in hybrid environments cost less than both isolated public and private cloud environments, 43% of organizations studied are in early stages or have not started applying security best-practices across their cloud environments.
For the 12th year in a row, the healthcare industry has recorded the highest average cost of a data breach. For the first time in the history of the report, healthcare’s cost of a data breach hit double digits in 2022 resulting in $10.1 million, increasing by nearly $1 million since last year.
Only 38% of the organizations studied indicated that their security team is sufficiently staffed (62% indicated their security teams are not). Organizations that said their security teams had a skills shortage had a higher-than-average cost of a data breach. The increase on average was about $550,000.
A really insightful part of this year’s report are the identified key cost factors. This year, IBM Security looked at 28 factors that influence the cost of a data breach. IBM Security included identity & access management (IAM), XDR technologies, multi-factor authentication (MFA), and crisis management teams for the first time in this report.
The chart below shows the average cost difference of breaches at organizations who have addressed these cost-influencing factors compared to the mean cost of a data breach of $4.35 million.
AI platforms, a DevSecOps approach, and use of an incident response team were the three factors associated with the highest cost decrease compared to the average cost of a data breach. The example used in the report show breaches at organizations with AI platforms had an average cost of $300,075 less than the mean cost of a data breach of $4.35 million.
Alternatively, security system complexity, occurrence of cloud migration when the organization is in the process of migrating to the cloud, and compliance failures were the three factors associated with the highest net increase in the average cost.
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Copyright © 2022 GreyCastle Security. All Rights Reserved
Ho Chin is Chief Financial Officer at GreyCastle Security. In this role, Ho leads Finance, HR, IT and Professional Development. As part of the executive leadership team, Ho works to establish the company’s overall strategy and ensure proper execution of the supporting initiatives pertaining to the above areas of responsibility.
Prior to joining GreyCastle Security, Ho led finance and administrative functions at multiple private equity and venture-backed portfolio companies across multiple industries. Ho holds a bachelor’s degree in Accounting from Pennsylvania State University in Centre County, Pennsylvania and a master’s degree in Business Administration from the Wharton School of Business at the University of Pennsylvania in Philadelphia, Pennsylvania.
Dan Kalil is Chief Executive Officer (CEO) and Board Chairman at GreyCastle Security. In this role, Dan provides vision, leadership and strategies that drive GreyCastle Security’s position as an industry leader. With an emphasis on customer success, Dan’s profitable growth model leverages a customer-centric business approach that balances employee wellbeing and social responsibility.
Prior to becoming CEO, Dan served as the company’s Chief Strategy Officer, during which he supported multiple acquisitions and helped the organization achieve substantial sales growth. In addition to serving as CEO at GreyCastle Security, Dan continues to hold the position of Chief Commercial Officer (CCO) at Assured information Security (AIS) in Rome, New York, a company he co-founded in 2001.
Over the course of the last 22 years, Dan has been committed to advancing the state of cybersecurity and has played an instrumental role in the identification and development of critical, next-generation cyber capabilities. He has held positions in almost every facet of cybersecurity, beginning as a computer forensic examiner and progressing through the management and executive leadership ranks. In addition to co-founding AIS, Dan has facilitated multiple cybersecurity startups, raised investment capital and has served in various lead and support roles toward the acquisition of five companies in the last eight years.
Dan has a bachelor’s degree in Cybersecurity and a master’s degree in Cybersecurity from Utica College in Utica, New York.
Michael Stamas is an entrepreneur, board member, Vice President and a founder of GreyCastle Security. With more than two decades of experience in the technology sector, Mike pairs his management and business development skills with a deep understanding of cybersecurity. Mike brings a unique brand of risk-based advising to GreyCastle clients and prospects.
Mike holds certifications in numerous security and technology related areas, including the Department of Homeland Security and other security technologies like Symantec, Cisco and Microsoft.
Mike plays an active role in his community and serves as a board member and Vice President of InfraGard Albany as well as an advisory board position with the Capital Region YMCA.
Mike has been recognized for his numerous achievements through various honors including the Albany Business Review’s prestigious 40 Under 40 award.
Dan Maynard serves as GreyCastle Security’s Chief Operating Officer, where he currently leads Sales, Marketing and Legal.
Dan has enjoyed a 30+ year career in the Information Technology and Telecommunications industry, during which time he has held various leadership positions for organizations such as Rochester Tel/RCI, Citizens Communications (Frontier), PAETEC Communications, IntegraOptics, tw telecom/Level3 and Centurylink.
In addition to various voice and data technology platforms, he possesses a strong background in leadership development, sales and marketing leadership, transformational leadership and strategic planning. Dan has a thirst for knowledge and as a committed lifelong learner, he encourages and supports professional development initiatives for his teams and continues his involvement with Vistage International.
Dan holds a bachelor’s degree in Biology from Lafayette College in Easton, Pennsylvania, where he was selected as a member of their Athletic Hall of Fame in 2016.
When not at work, Dan enjoys traveling, golfing, attending Utica Comets hockey games and relaxing in the Adirondacks on beautiful Canada Lake with family and friends.
Dan Didier is the Vice President of Solutions and board member at GreyCastle Security.
Dan has been a cybersecurity practitioner for more than 20 years and uses his knowledge and experience to develop cybersecurity solutions that ensure readiness and preparedness.
Dan received his bachelor’s degree in Telecommunications from SUNY Polytechnic Institute in Utica, New York, and graduated Summa Cum Laude with a master’s degree in Information Assurance from Norwich University in Northfield, Vermont.
Our Computer Incident Response Teams (CIRTs) have responded to hundreds of breaches, intrusions, malware infections, thefts, employee investigations, fraud cases and other incidents. Our highly-certified experts have extensive experience in command, coordination and correction of incidents in nearly every industry throughout North America, from local businesses to Fortune 500 international conglomerates.
Francesca LoPorto-Brandow is Director of Culture at GreyCastle Security. In this role, Francesca leads all social responsibility efforts and partnerships and develops effective strategies that promote organizational-wide behaviors and attitudes consistent with a culture of safety, inclusion, teamwork, motivation and high-performance.
Prior to this role, Francesca was Director of People & Culture at GreyCastle and with her leadership, the company’s culture has been recognized by Inc. Magazine as a Nationally recognized Best Workplace, Albany Business Review Best Places to Work and Albany Times Union Top Workplaces.
Before joining GreyCastle Security, Francesca worked as an OD consultant and focused on strategic culture change at The Kaleel Jamison Consulting Group, Inc. for more than six years. There, she facilitated client education sessions, coached leaders and teams, developed and executed consulting interventions and served as strategy project leader on various client engagements. Her work has taken her into Fortune 100 companies and across borders including Panama, Singapore and beyond.
Francesca is a Lean Six Sigma–certified Green Belt, a proud YWCA-GCR board member and in 2013, she coordinated and emceed the inaugural TEDx Troy—a livestream of TEDCity 2.0. Since 2012, she has coordinated and emceed the Troy 100 Forum, a biannual forum for government, religious and community leaders to discuss issues vital to the future of Troy, New York.
Bilingual in English and Italian, Francesca holds a bachelor’s degree in Management and Technology from the Rensselaer Polytechnic Institute’s Lally School of Management & Technology. She was awarded Cybersecurity Recruiter of the year North America in 2017 by the Cybersecurity Excellence Awards.
Jamie Aiello is Senior Vice President of Services and Product Management at GreyCastle Security. In this position, Jamie is responsible for leading a high performing and well-balanced team that is ultimately responsible for the identification, selection, execution and successful performance of our company’s diverse portfolio of cybersecurity offerings.
Prior to joining GreyCastle Security, Jamie has held leadership positions with Annese and Associates, ConvergeOne and BlueSky IT Partners with a focus on delivering cost effective information technology solutions for companies across multiple verticals.
Jamie holds a bachelor’s degree in Political Science from Le Moyne College in Syracuse, New York, a master’s degree in Business Administration from Gardner-Webb University in Boiling Springs, North Carolina and a master’s degree in Computer Information Systems from University of Phoenix in Phoenix, Arizona.