7 Routes To Reducing The Compliance Tax

Complying with security standards and regulations is a cost of doing business, but through smart practices that cost doesnt have to be so high

Sometimes that myriad of security regulatory requirements can appear to enterprises as a burdensome compliance tax on the business. The checklists, baselines, standards and rules at play continue to add up and without a strategy in place, it might seem like the cost of complying outweighs the consequences of ignoring them. However, meaningful adherence to the spirit of the laws -- actually improving the risk posture of the organization -- brings a lot of business returns beyond the satisfaction of auditors
Compliance mandates have been introduced to force businesses to think about security and privacy rather than risk the personal data of their customers and value of their shareholders, says Adam Ely, COO of Bluebox, former head of security and compliance at TiVo and former CISO of the Heroku business unit at Salesforce. In reality, the cost of compliance is a cost of doing business and one that should have been realized all along.
As for that compliance tax, it doesnt necessarily have to be as expensive as some believe it to be. There are a number of strategies, tools and practices that can greatly reduce associated costs. But before tackling those, remember to look up and see the forest for the trees. Information security professionals can be a bit myopic in how they view compliance, looking at it strictly as a technical issue, says Tim Erlin, director of security and risk strategy for nCircle.
But its a business problem, he says. Businesses can avoid compliance requirements with cost-driven strategies, in the same ways they reduce their corporate tax burden. One example of this kind of strategy is the decision to avoid PCI compliance by outsourcing credit card processing so you dont actually store any credit card data.
1. Think Top-Down Vs. Bottom-Up
Organizations that view compliance as a function of risk management activities rather than the other way around tend to better keep their compliance costs in check, experts agree.
In a lot of cases, a top-down approach can help organizations reduce costs by as much as 25 to 45 percent, says A.N. Ananth, CEO of EventTracker.
Use a top-down, risk-based approach instead of an overly detailed, bottom-up assessment, says Ananth, citing two recent releases by the Public Company Accounting Oversight Board (PCAOB) as a good place to look for proof on why and how it works. The PCAOB has identified the primary drivers of cost to be the scope of the internal control audit and the amount of management testing being performed.
In simplest terms, many describe this as a test-once, comply-to-many approach, says Torsten George, vice president of worldwide marketing, products and support for risk management firm Agiliance, who believes that instituting security controls and then cross-mapping them to individual mandates is the most efficient approach.
This allows IT staff to document compliance to multiple regulations and mandates using fewer steps and resources, he says.
[Are you measuring all of your compliance ROI? See
5 Hidden Benefits of IT Compliance Programs
.]
Key to cross-mapping is the institution of quality security metrics. Repeatable and understandable means for measuring security performance will greatly streamline the audit process, Erlin says.
Compliance is about audits, and audits are about measurement. If youre already have a security program in place, theres a good chance youre close to being compliant but you have to articulate this to an auditor, he says. If youre regularly measuring your security performance youre way ahead of the game.
Not only could a top-down approach offer compliance cost-savings, but it also stands to drive ROI from security activities
The flip-side to regulatory pressures on security preparedness being a tax is that those companies that are prepared will have a competitive advantage, says Gant Redmon, general counsel and vice president of business development for Co3 Systems. The companies that possess the tools and competence to know what security measure they have in place, benchmark their security preparedness, and have incident response procedures in place will experience regulations as validation of their efforts.
2. Continuous Monitoring With A Caveat
Continuous monitoring has quickly gained steam as a tool deployed to improve the dexterity of risk management and compliance activities. But continuous monitoring alone wont necessarily guarantee cost savings on the compliance front, says Yo Delmar, vice president of GRC solutions at MetricStream.
Without some sort of centralized platform to synthesize information from those feeds and correlate them to policies, standards, configuration baselines and regulations, the benefits wont be realized.
Continuous controls monitoring can dramatically reduce the burden of compliance for information security if and only if IT GRC platforms also map to regulatory requirements, she says.
3. Use Data Classification To Your Advantage
You dont want to put a $200 fence around a $5 asset, but in the same vein it doesnt make sense to put a $5 fence around a $2,000 asset, says Caroline Wong, director of regional product management for risk and compliance at Symantec. Without data classification, though, it is difficult to make financial value-based judgments on where to invest.
Businesses should manage security and compliance like any other aspect of the business, the investment has to make sense for the business, Wong says. It all comes down to proper data classification -- assess which assets are important to the company and protect them accordingly.
4. Examine Security Tools With Circumspection
Often the burden of security and compliance is wrapped up in how much expertise is needed to run the controls put in place and what kind of performance hits those controls will place on IT infrastructure. Organizations should not just be looking at how much tools cost, but also what kind of expenses theyll incur once deployed.
Organizations typically focus on the capital expenditure but underestimate cost of ongoing administration and/or change management, says Oliver Wai, product manager for Barracuda Networks, explaining that complex tools are not always the best option. Select a solution that is flexible and easy to administer. In fact, complex solutions are often riskier solutions due to misconfiguration by administrators.
Similarly, organizations should be seeking controls with performance requirements that match the organizations capability to meet them.
Often organizations are wildly optimistic in projecting traffic requirements or performance needs, he says. Analyze the network or application performance before selecting a solution.
Next Page: Automate And Embed 5. Automate And Embed
Automating compliance reporting and building controls directly into operational technologies rather than adding additional blocking layers are key to reducing time on audit-related activities. According to Ely, in his time as CISO of TiVo, these strategies helped his firm reduce compliance and audit-related costs by 60 percent.
To move security forward and overcome the compliance burden perception, we must focus on the positive benefits, reduce cost, and minimize operational overhead through automation, repeatable practices, and highlighting how businesses can benefit from the new processes and controls, Ely says
For example, documenting user access to applications and data stands as one of the most expensive aspects of proving compliance. But automation can greatly reduce the costs around this IAM-related regulatory requirement.
Access certification is a very complicated, labor-intensive process that involves IT, infosec, the line of business and audit (and) compliance teams, says Deepak Taneja, CTO and founder of IAM firm Aveksa. By automating this process, companies can actually turn access certification from a tax to an asset by making it much a more efficient process that delivers business value to the company and makes the enterprise more secure.
Similarly, costs tied into security-related tasks such as manual approval processes and password management can be diminished through self-service capabilities.
Implementing self-service capabilities for information security-related tasks reduces the burden on IT while improving security as long as workflows are enabled because the appropriate approvers are engaged directly, says Ryan Ward, chief innovation officer for IAM firm Avatier.
6. Dont Boil The Ocean
Compliance costs can spiral out of control when organizations try to implement controls across too broad a swath of IT infrastructure. Dont boil the ocean and tack controls on all applications and systems at once, warns Marc Boorshtein, CTO of Tremolo Security.
Focus first on covered applications that require compliance and then look at process improvement to increase the value of the system, he says.
For example, when SOX compliance projects were first being rolled out in the enterprise, many chose to try to use identity management systems to manage identities in every application instead of just covered applications, he says.
This lead to massive project implementation delays, Boorshtein says. Enterprises would eventually only handle covered applications with a bad taste in their mouth from the implementation, which in turn would discourage them from continuing to invest in getting additional applications on board.
That lead to the identity management software incurring a very high cost per application to implement, he says.
If done correctly your costs should decrease as you add applications, increasing the value of the system, he says.
7. Require Secure Software Development
Organizations could save a ton of compliance dollars and countless security headaches if only software projects were governed more by the directive that Software must be secure against at least the OWASP Top 10, WASC 24, or similar than the one that states that Delivery is mandated by date, and any delay will come with penalties, says Joshua Marpet, managing principal of Guarded Risk, a data security and forensic consultancy.
People do what you pay them to, he says. If our software projects were paid to be secure software projects, instead of fast -- (and) probably shoddily -- then regulatory compliance would be much easier, cheaper, and simpler.
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