Why You Need A Structured Simulation Program

Five tips for designing and implementing your program

The single most determinative factor in how an organisation emerges from a cyberattack is how it conducts itself during the crisis. And the biggest determinant of how an organisation conducts itself during a crisis is how prepared it is. Not only does being prepared reduce the likelihood of a crisis occurring in the first place, but for those that are impossible to predict or avoid, it also reduces the time to respond and helps minimise adverse legal, regulatory and commercial consequences.

The good news is that corporate Australia is ramping up its preparation and uplift of cyber incident response plans and playbooks. But while these are important, they are virtually useless if not regularly tested and refined. And given the speed with which the threat and regulatory landscape is evolving, an annual cyber simulation will rarely be enough to get match fit. The old navy seal saying, ‘you don’t rise to the occasion, you fall to the level of your training,’ is on point.

This means a structured cyber simulation program (as opposed to one-off or ad-hoc tabletop exercises) is now an essential part of cyber risk management. There’s a growing body of guidance from regulators (including APRA and the OAIC), which indicates that a structured, risk-based approach to testing your ability to respond to various scenarios is now a regulatory expectation.1 Cyber insurers are also increasingly making regular cyber simulations with senior management participation a condition of coverage.

Below are five tips to keep in mind when designing and implementing your program.

1. Set clear objectives

The overarching objectives of any cyber simulation program should be to:

      • create muscle memory around the cyber incident response process; and

      • identify improvements that can be made to technical and operational controls, policies, processes and plans.

    In addition to these overarching objectives, a cyber simulation program should include a list of specific criteria the organisation would like to test, which may vary from scenario to scenario. Your specific criteria should be informed by emerging cybersecurity threats and trends, identified gaps in your company’s controls, regulatory requirements, enforcement activity and updates to your incident response plans and playbooks.

    Your objectives and criteria should also be regularly reviewed to ensure they remain up to date and fit for purpose.

    2. Test a variety of scenarios

    Your simulation scenarios should cover different threat types,2 including ransomware, data theft extortion, supply chain attacks, insider threats (both malicious and inadvertent), espionage and nation state attacks. They should also contemplate disruption to different business units, asset lines and systems.

    Your program should also include scenarios:

        • run using a variety of formats

        • requiring participation by a range of stakeholders (eg senior management, the board, affiliates, business partners, critical suppliers, external breach response experts and advisors)

        • conducted both at an enterprise level and at a business unit/asset level

        • focussing on different components of the incident response (e.g. technical red teaming exercises, executive tabletop exercises and scenarios focussing specifically on the communications response), as well as some involving an end-to-end response.3

      Tip! Simulations often overlook the broader operational impact on the business and engagement with other stakeholders. Ensure testing covers those backfilling roles of people on the response team, business continuity contingencies and engagement with other stakeholders such as critical suppliers and related entities (whether in Australia or overseas).

      3. Involve the board

      For directors to discharge their duties, the board needs to understand its role in any cyber incident—this includes understanding how the incident response team will operate, how frequently and when it will receive updates, the decisions it will need to make and the information it will need to make them.

      Although not every simulation will require participation by the board, cyber simulation programs should give the board regular opportunities to discuss critical decisions like trading halts, market disclosures and whether or not to engage with a threat actor and/or pay a ransom in the context of different scenarios.

      4. Conduct regular briefings in addition to cyber simulations

      Briefings should be conducted regularly to ensure each member of the response team (and their alternate) is familiar with relevant plans, playbooks and processes, as well as their roles and responsibilities (and those of others in the response team).

      When it comes to the actual simulation, there is also value in limiting the information provided in advance of the simulation itself (aside from information about timing, duration, expected participants and ‘rules of play’), to better reflect a real-life incident.

      5. Don’t waste a good crisis

      Each simulation should be followed by a debrief for participants and an assessment of the response, having regard to the specific objectives identified for that scenario.

      The assessment should record what worked well and areas for improvement. It should also include actionable recommendations about:

          • the aspects of the response plans, playbooks and processes that need to be updated to reflect any pain points which arose during the simulation

          • how the design and delivery of future cyber simulations could be improved.

        The key observations and recommendations should be reported to your board, and lessons learned should be quickly incorporated into your plans, playbooks and processes.

        The Federal Court’s judgment in proceedings brought by ASIC against RI Advice Group Pty Ltd in 2022 emphasised that a timely response to cyber incidents is key, and identifying root causes and improving processes following incidents will be an area of focus for the regulator. The same thinking is likely to extend to improving processes where a simulation has identified inadequate processes or controls.

        Source: https://www.allens.com.au/insights-news/insights/2023/07/why-every-company-should-have-a-structured-cyber-simulation-program/#technologyscaleupawards

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