The Application Process to the Online Virtual World - Case Study Example

McBride Financial Services: Risk Assessment McBride Financial Services: Risk Assessment Introduction The 21st century technology has opened the gateway for businesses to explore new opportunities. However, with growing opportunities, businesses are also exposed to the threats that are associated with extending operations online or in the virtual space. Several risks now surround businesses functioning in the cyberspace due to which business have to be extremely cautious by evaluating risks and implementing certain controls. As a core product, Mc Bride Financial Services aims to offer an efficient and user friendly mortgage application process. Levering technology has been identified as a central means for providing the cutting edge experience to its customers. By successfully exploiting and implementing the Web 2.0, the company aims to take the traditional paper based application process to the online virtual world thereby allowing speedy yet fulfilling user experience to its customers. McBride Financial Services has laid great stress on its ability to provide only mortgage application process as a key feature for its customers. In fact, it has identified the service as a key feature for its customers, more like a differentiating factor between the company and its competitors in the market. For this purpose, the company has heavily invested in hiring regional brokers in their various offices so as to assist its customers in filling out the application form. But, operating in the virtual space implies operating in the presence of constant operational risks, which, in turn, necessitates the assessment of risks well before they become a dilemma for the company’s operations. Hence, risks should be identified and analyzed for their potential harm so as to think up and implement controls that reduce the threats of the risks. Data Risks Since technology forms an important component of McBride’s operations, it is necessary to assess the risks of operating online. In his article, Wurzler (2013) mentions that several risks have erupted as a result of having shifted from paper based files to computational files that are accessed through networks and the internet, thereby increasing chances of security risks. With the technological revolution, more emphasis is now paid towards speed and powerful technology. Even McBride Financial Services has identified the providence of ‘efficient’ services as a key feature to their operations. The increased need for speed has transformed the business domain but at the same time introducing risks to data and information. Information risks is perhaps the most common security risks associated with virtual operations. The term refers to the unauthorized access of confidential or non-public information stored on computers by forbidden parties (Wurzler, 2013). In the case of McBride Financial Services, its computers could be holding thousands of terabytes of confidential customer information that may be exploited by unauthorized parties so as to cause monetary harm to its customers, not to mention the image of the company too. A breach to confidential data can lead to an enormous financial loss as well as embarrassment to the business. Thus, information risks are a major problem for businesses that involve big data, particularly those that depend on the World Wide Web for storage and access. Information Technology (IT) experts are always involved in indentifying and assessing security risks that may threaten the working of computational infrastructures. As such, they evaluate the degree of harm that any particular threat can cause to the system. Wurzler (2013) points out that threat can be caused from internal as well as external sources, also quoting the huge costs of Intellectual Property (IP) thefts and cyber crimes to IT giants like Symantec. Insider thefts are usually committed by a company’s own employees by manipulating the Internet Protocol (IP) addresses. Since McBride would be holding a great amount of customer data that is filled out through its online forms, its employees remain potential candidates for breaching the security of the customer information. Check and balance along with internal audit helps to reduce the number and occurrence of insider thefts. So, McBride could also work to reduce internal information thefts by placing the required checks. External threats have historically caused a lot of harm to several companies. The cost of repairing the system after an unauthorized attack is also high. But more importantly, business that have been a victim of external attack also lose out much of their business income as its customers lose confidence in their system and the amount of protection they can provide. The impact of a data breach is costly, often costing the affected businesses huge sums of money as their image is damaged unless handled properly. In addition, the attacks may also cause a reduction in stock prices for a publically listed company. As McBride will be dealing with powerful IT infrastructures and terabytes of data, it is recommended that it establishes an explicit information security policy and implements certain controls and checks to prevent unauthorized access, both internally as well as externally. Environmental Risks Environmental risks are also important considerations for businesses endeavoring to analyze risks to their operations. In particular, environmental risks can not only cause harm to a company’s employees but also to its operations. Having its head office in Boise, Idaho is a challenge for McBride Financial Services as the region’s environmental statistics do not provide a satisfactory risk profile. Ki (2012) from Boise State Public Radio, articulated a study carried out by Environmental Protection Agency which states how Idaho has a dangerously high level of toxic chemical releases as compared to its counterparts, Oregon and Washington. A great proportion of the reportedly 67 million pounds of total toxic waste comes from the mining industry. The quoted level is an alarmingly high number posing a threat to McBride’s head office in Boise, Idaho which can be affected by the toxic chemical releases. In particular, its operations can greatly suffer in the case of a leakage reaching to its office or its employees come into contact with the toxic chemical releases. In any case, exposure to the toxic waste can have negative implications for McBride Financial Services and its continuing operations in the region. So, the toxicity of the city and state is a risks to the environment in which the business operates. The government has taken quite a few steps in order to clean up the toxic chemical wastes and has introduced programs that collect wastes. Hazardous waste has been defined as a waste in its various forms including liquid, solid, gas, and sludge, that can potentially cause harm to the environment and health risks for individuals. The government is currently funding various waste cleaning programs in order to properly manage the toxic chemicals and dispose them off in the required way. While its head office is undoubtedly exposed to risks from hazardous and toxic chemical wastes, a series of control measures by the business can help to protect not only the environment but also its own operations from being disrupted by toxic chemical leakage or by other means of contact. The risks of coming in contact with toxic materials are increased by the presence of a network of transportation facilities that carry toxic materials. Particularly, transportation facilities operated by government programs pose a minor threat to local businesses in case an accident spreads the toxicity of the materials to unintended areas thereby affecting the region. While the chances of such an incident are less, there does remain a possibility that such an event may happen thereby spurring business to perceive the possible threat in advance to its occurrence. That will allow businesses like McBride Financial Services to take precautionary measures before hand so as to mitigate the severity of the incident. Since McBride’s working involves a lot of big data, it is generally sensible to hold back up of the data just in case data loss occurs. Other safety efforts and controls could be set up so that the data is held secure in distant data servers so that the data remains unaffected if the site is affected by an unforeseen event. Risks from Criminal Activities Criminal risks are also some threats that should be accounted for when analyzing the risks to a business’ operations. The previously discussed risk of information theft also constitutes a criminal act and is liable to a similar legal procedure as is a physical crime. However, this section will discuss the possible threats from physical criminal activities that tend to attempt a physical breech to any of the various offices of McBride Financial Services. Dealing financial services, such as loans and mortgages, McBride Financial Services needs to be extremely cautious of such notorious acts of crimes. The crime report by Boise Police Department (2013) suggests an overall 4 percent decrease in the crime rate. The figures show a total 44 cases of robbery, 214 cases of commercial burglary, and 3807 cases of thefts. While the overall result has been a decrease in the crime rate, the numbers till represent a high fraction of possible thefts, burglaries, and robberies. These numbers, although not alarmingly high, do represent a certain probability of the crimes reaching the head office of McBride Financial Services that is laden with financial documents, money, and other important possessions. Thus, any act of burglary, theft, or robbery can hurt its current standing in the market. Throughout its mission statement and business plan, McBride Financial Services has emphasized the role of efficiency in its services. In order to deliver to its customers as efficiently as possible, McBride seems to have invested in hiring financial brokers so as to guide its customers regarding the online application process. Apart from this, the company also seeks to provide other customer friendly services in financial reporting and so on. This means that its offices house several important documentation and files that may be customer-specific. An on-site breach to its security may also cause severe implications for its data storage as this can potentially lead towards loss of finances as well as individual customer information and records. Also, an on-site attack may disrupt the operations of the company beyond an extended period of time thereby incurring huge losses. Since the head office is located in Boise, Idaho, any damage to the office in terms of any physical or virtual risk may also disrupt operations for many of its smaller branches located in Fargo, Bismarck, Helena, Jackson, Cheyenne, Sioux Falls, and Rapid City. Also, any criminal activity on the head office can lead to a temporary termination of its services that may affect its business as well as customers. It is, thus, important for McBride Financial Services to put in place certain measures that control the entry and exit of individuals, both external and internal, to vaults that contain confidential and important possessions. Conclusion Overall, the biggest risk to McBride Financial Services remains information risk since the business model of the company is based upon the providence of efficient and user-friendly mortgage and loan application process. Its heavy reliance upon technology has opened the gates for not only more opportunities, but alongside, potential risks as well. Information risk may involve severe loss of company and customer data that may be exploited by the unauthorized individual. In many cases, competitors of a business also seem to use the stolen data so as to know the secrets of their competitors and to better their own services by unlocking competitor data. McBride needs to employ its risk experts who identify potential risks that may threaten its operations and devise plans so as to mitigate the negative effects of the risks. Criminal as well as environmental risks also remain major physical risks to its operations beyond its virtual sphere. Such risks can threaten the functional operations of it services thereby leading to a temporary latency or delay in its services resulting in frustration for the customers as well as costs for the company. To protect the confidentiality of its customers, McBride Financial Services not only needs to put physical checks in place but also security in the cyberspace so that its customers experience no disruptions in their activities and no associated monetary risks. Therefore, risk assessment well before hand as well as the placement of checks and balances can help the company provide what it aims for. References Boise Police Department (2013). Boise City Statistical Summary - Quarter 4, 2013. (1st ed.). Boise, ID. Retrieved from http://police.cityofboise.org/media/597786/2013-boise-crime-stats.pdf Ki, S. (2012). More Toxic Chemical Releases in Idaho Than Oregon and Washington. Boise State Public Radio. Retrieved 23 May 2014, from http://boisestatepublicradio.org/post/more-toxic-chemical-releases-idaho-oregon-and-washington Wurzler, J. (2013). Information Risks and Risk Management. Sans Institute. Read More