Maximizing the Value of a Risk Assessment for Your Business
If you’re a business owner or leader who works in a regulated industry, you might be required to conduct a risk assessment. But beyond being a regulatory necessity, does a risk assessment actually provide value to your business?
The short answer: It depends on what you ask for.
“If you treat a risk assessment as just a regulatory checkbox, then that’s exactly what you’ll get—an expensive checkmark that doesn’t provide much real value,” says Shawn Duffy of Duffy Compliance, a cybersecurity and compliance expert who’s spent countless hours helping businesses with compliance requirements.
He continues, “But, if you know what to ask for, a risk assessment can be a vital tool for understanding threats that could disrupt your business and figuring out how to protect yourself before disaster strikes.”
So, to give you some superior insight on how to get your money’s worth when conducting a risk assessment, we sat down with Shawn to help break down:
What a risk assessment is, and why your business is required to have one.
The difference between risk and vulnerability assessments.
How to squeeze the most value from this pricey process.
By the end, we hope you’ll understand how to utilize your risk assessment as a strategic tool—not just a regulatory requirement.
What is a Risk Assessment?
A risk assessment is a structured process used to identify, analyze, and prioritize potential threats to a business’s operations, data, and security.
It evaluates all your potential risks to assess their likelihood and impact so you can proactively address them before they lead to expensive disruptions.
Security assessments are required because breaches in critical industries like healthcare (HIPAA), finance (Sarbanes-Oxley), and government contracting (CMMC) can have devastating ripple effects, not just for your business but also across society and the economy.
Risk Assessments vs. Vulnerability Assessments: Understanding the Difference
All the various types of security assessments business owners come across can cause quite a bit of confusion. Shawn warns, “A problem we see a lot now is people don’t know what a risk assessment is, and they think of it as a vulnerability assessment report, which it’s not.”
While they sound similar, they serve very different purposes:
A Risk Assessment
…is big-picture. It is a structured process used to identify vulnerabilities and analyze and prioritize potential threats to a business’s operations, data, and security weaknesses. It takes into account everything from cybersecurity risks to environmental disasters and helps you create a strategy to counteract them.
A Vulnerability Assessment
…is technical and focused. The vulnerability assessment process uses vulnerability testing to do a deep dive into your computer systems, network hosts, and applications. It uses vulnerability assessment tools like penetration testing to detect vulnerable systems and identify security weaknesses that hackers could exploit.
The Core Components of a Risk Assessment
A risk assessment is only valuable if you know how to use it. By understanding its core components, you can better understand what to expect from the process.
The four key components are:
Threat Identification
Threat identification is the process used to identify all the dangerous elements that could disrupt your business.
There are several different categories of threats you’ll need to assess:
Human Factors – Insider threats, disgruntled employees, social engineering, and accidental misconfigurations.
Environmental Risks – Power outages, risky behavior by your neighbors, or nearby construction that could disrupt operations.
Natural Disasters – Earthquakes, hurricanes, and other unpredictable events that could cause major downtime.
Technical Vulnerabilities – Software vulnerabilities, configuration settings, and cyber threats like network security attacks, code injection attacks, or ransomware.
Once you’ve identified threats, a vulnerability analysis will help determine which of these weaknesses are most severe and exploitable so you can prioritize them.
Impact Analysis
Not all threats are equally dangerous. Impact analysis evaluates how much damage each threat could cause if it happens.
Shawn clarifies the importance of this core activity; “Every business has many more threats than they might imagine. Each of these threats impacts vulnerable systems differently, and understanding those impacts and the likelihood of them happening—that’s at the core of what risk management is all about.”
Likelihood Assessment
Your assessment team shouldn’t just ask, “What could go wrong?” it should also consider, “How likely is this to happen?”
Shawn gives an example: “What is the likelihood of a tornado happening in Massachusetts? Pretty low. The chances of it happening in Oklahoma? Higher.”
Risk Calculations and Scoring
Once a business knows its threats, it needs a way to prioritize them. This is done by assigning a risk score based on both the impact and the likelihood of them happening.
Risk assessments use two types of scoring:
Qualitative: Risks are labeled as high, moderate, or low.
Quantitative: Risks are assigned numerical values (e.g., a risk score of 7 out of 10).
According to Shawn: “Most risks are defined qualitatively because they’re easier to contextualize.”
Working with Providers: Choosing the Right Partner
Choosing the right partner to help conduct your risk assessment ensures you receive a thorough, actionable evaluation—not just a generic report filled with jargon.
As Shawn tells us, “You need to get things that are relevant to you because it’s your money. It does you no good if your provider has the knowledge and you do not. So vet your provider by asking them: What is the report gonna look like? Will it have actionable steps? And will it be in a language I understand?”
Positive Provider Traits
Expertise in your industry – Do they understand the specific risks affecting your niche?
Comprehensive approach – Will they evaluate all types of threats, including cybersecurity, human, environmental, and operational risks?
Clear, actionable reporting – Make sure they aren’t going to just give you a document stuffed with tech speak. You need a structured report with prioritization and real-world recommendations.
Ongoing support – Do they offer implementation guidance and follow-up monitoring, or do they disappear after delivering the report?
Provider Red Flags
One-size-fits-all assessments – If a provider offers a template-style report without customizing it for your business, it won’t do you much good.
Focusing only on technical vulnerabilities – A true risk assessment includes operational and human risks, not just a technical report pulled from network security scanners.
No explanation of their process – If providers can’t clearly explain how they assess risks, they’re not the right choice.
I Got My Security Assessment: Now What?
Many businesses fail to act on their risk assessments, which defeats the entire purpose.
As Shawn explains: “Government compliance requires you to have an assessment, but they don’t come back and double-check if you implemented it. But when you ignore the risks found in your assessment, there’s usually devastating consequences down the line.”
Post Assessment Next Steps
To get the most out of your assessment, you’ll want to:
Immediately address high-risk issues first – Focus on the biggest threats that could cause the most damage.
Implement security controls – This may involve implementing automated testing tools, updating policies, or improving employee training.
Monitor risks continuously – New threats emerge all the time, so reassessing risks regularly is key.
Common Post-Assessment Mistakes
Thinking the assessment is the final step – An assessment is a starting point, not a one-and-done exercise.
Ignoring “low-priority” risks – Just because something isn’t urgent today doesn’t mean it won’t escalate later.
Failing to update your assessments over time – Risk factors change constantly. If you only conduct one assessment and never direct your security team to monitor threat intelligence feeds and vulnerability databases or check back on previous risks that might pop back up again, you’ll constantly end up with new gaps.
Getting the most value from your security assessment isn’t just about ROI—it’s also about survival in a digital landscape full of evolving threats. As the new wave of cybercriminals leverages AI-driven attack patterns, deepfake phishing, and automated hacking, they will be able to bypass outdated defenses and exploit your security vulnerabilities faster than ever.
This is why it’s crucial that you use the time and money spent on this process to future-proof your business and minimize your weaknesses—not just check a box on your compliance to-do list. As Shawn warns, “AI has made it so simple, you don’t have to be an expert to cause data breaches anymore. Even moderately skilled hackers can leverage these tools to exploit vulnerabilities in ways we’ve never seen before.”
Have you been required to do a risk assessment and are struggling to choose the right provider or make sense of the findings?
If you have more questions about the process that weren’t answered in this blog, or need some help with the compliance process, reach out to Shawn at shawn@duffycompliance.com.
Or, if you want a cybersecurity infrastructure that can defend against evolving threats and keep you consistently compliant, ask Krister Dunn at kristerd@reliabletechnology.co about our all-inclusive managed IT services.