How Much Are You Worth?
Posted on Thu, Jan 06, 2011
According to the U.S. Bureau of Chemistry and Soils, the human body is made up of 65% Oxygen, 18% Carbon, 10% Hydrogen, 3% Nitrogen, 1.5% Calcium, 1% Phosphorous and traces of 15 other elements. What is the value of these elements on the open market? Less than $1.00. But are you really worth less than a dollar? That depends on how you calculate value.
There are many ways to calculate the value of an asset, depending on what you’re measuring and how you measure it. For many security leaders, calculating the value of a security solution can be a very difficult prospect. Are you correctly calculating the value of your department, your people, your processes and your tools? Or are you assuming that you’re worth less than one dollar?
Let’s start with a definition of physical security. The measures used to provide physical protection of resources against deliberate and accidental threats.
There are three words in this sentence that provide clues to the valuation of your security department:
1. Measures
2. Resources
3. Threats
Understanding your role, the way you articulate it, and the network (ecosystem) that is indirectly or directly impacted by it, is the foundation of value. Getting to the data around this ecosystem, aggregating and measuring it over time, and applying it in a strategic context will allow that value to multiply.
What methodologies you use to get to a value basis will depend on the language of your key executive resources. Acronyms like ROI, TCO, ALE, EVA, and ROCE usually represent a value language that may apply partially or not at all.
As well, your industry has a perspective on value and risk that may play a significant role in your calculation. Sarbanes-Oxley and HIPPA create a mandate around a security spend that may not be relevant to your value equation.
And finally, there is nothing like an ‘event’ to underline and promote any business agenda, including security. However, what we have found is that the better armed you are with the right information, the better able you are to respond to an opportunity. Like an athlete who has been forced to sit on the bench, security must be prepared to take advantage of what occurs on the field of business.
But don’t forget, while you are preparing for strategic value, you are operating with a finite budget to fulfill your charter. How that money is spent has a lot to do with your efficient use of resources and technology. We have discovered that there is a gap in the marketplace where the expertise of designing and implementing security solutions meets effective use of those solutions over time in context of your people and processes.
We will be exploring these value and efficiency issues in this forum. But we leave you with the critical question: Are you prepared with the right tools to measure your security solution performance, with the right language to articulate those measurements, so that when you are called off the bench, you can feel confident and empowered?
Let us know your thoughts.