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Role of IT Security in Business Alliances

Role of IT Security in Business Alliances | ARCON Blog


Business alliances and partnerships are key growth enablers for both large organizations and SMBs. The main purpose of a business alliance is to achieve the desired financial goals by sharing operational responsibilities that are mutually and easily doable. 

Many organizations even go for alliances to fulfill the gaps in their business process with the help of their partners. It not only brings efficiency gains but also boosts profitability. 

Now, to make a collaboration that brings the desired results, secure IT infrastructure plays a pivotal role. A single IT security loophole or a cyber incident cannot only affect the victim but also the alliance partner who is involved in the business collaboration with the victim. In other words, in addition to business synergies, both parties need to understand the significance of IT security measures being implemented in place. 

Why is IT security crucial in business alliances?

Although business agreements between two organizations cover the scope, objectives, requirements, and profit sharing details, crystal clear policies on data security and IT governance framework must be part of any partnership agreement.

Every organization desires a secured IT infrastructure today to ensure an uninterrupted business process. With the rising complexities of cyber security, it is highly imperative to keep in  mind the IT infra security requirements of both merging businesses for a smooth transition.  

A single breach incident cannot only cost heavily to both partnering organizations, but other business stakeholders and investors will distrust the company if they find that the data is not managed properly. 

For any partnership to prosper in today’s digital landscape, the partnering organizations have to be at par with global standards. It should start with establishing stringent IT security policies and standards. IT governance is critical to ensure sustainable business growth. 


What are the apparent IT risks?

As business-critical data flows from system to system and is shared and accessed by multiple end-users, what would happen if it lands in the hands of any suspicious third-party user or any malicious insider? What if there is cyber espionage or data exfiltration?

The answer to all these questions boils down to one and only way out:Strengthen IT security policy and mechanisms to ensure business continuity. 

For instance, a manufacturing company with large on-prem IT infrastructure collaborates for business synergies with another company with strong supply chain capabilities that has installed multiple SaaS applications.

That means, once merged, the new entity will have large hybrid IT environments, exposing it to more IT and data vulnerability. 

If the new business collaboration fails to establish robust IT governance and policies to manage and monitor end-users in hybrid environments, the threat to systems will amplify. 

Besides, suffering heavy financial losses stemming from the data breach, today’s organizations have to face a double whammy: massive financial penalties arising due to non-compliance. Adding to the woes is the loss of reputation. 


Business Alliances: Some Measures for Data Security 

Unified IT governance: Organizations do require a unified IT governance framework for better visibility. A centralized governance approach ensures authorization and audit of every IT activity even as data flows endlessly within the organization. Unified IT governance enhances end-points’ security and secures identities that continually interact with business-critical applications.

Robust Access Control: It is always advisable to have a tight access control in any IT environment. Both for on-cloud and on-prem IT infrastructure, a robust access control mechanism with multiple layers of user authentication validates the end-user. Especially for organizations where a large number of privileged users regularly access business-critical applications and systems, it is highly imperative. Moreover, when two organizations merge, role and rule-based access control helps both the organizations to segregate the users in task-based groups, which again is more secure from an IT risk perspective.

Regulatory Compliance: By building security controls that adhere to regulatory mandates, organizations can mitigate data breaches and avoid paying hefty fines for non-compliance. Several global regulations such as the EU-GDPR and IT Standards like the PCI-DSS, HIPAA, ISO 27001 etc. among many regional and Central Banks mandates explicitly mention the need to reinforce the Access Controls, Access Management, Password Rotations, Segregation of end-users based on responsibilities and frequent IT audits and reporting. 



Robust IT security must be at the core of any business alliance. Poor IT security planning or an IT incident will only result in higher cyber insurance premiums and eventually impact the profitability and sustainable growth – the purpose for which entities forge alliances. 


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