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April 16, 2014


Russ Cancilla

Great article K2! I'd like to offer some additional food for thought that may enhance the CSO's opportunity to be embraced as a business leader when it come to budgets. Most CSO's can talk about 'their budget' but few CSO budgets include the total security spend across the company. A large portion of security costs are often included in the operations, facilities or field budgets and finance plans; embedded in operations budgets. If a CSO cannot talk about the total security spend across all of his/her company, they can't really talk about the impact security spending is having on the firms profitability. CEO's are not only interested in the CSO's budget but they are interested in what impact - overall - security costs are having on the profitability of the company. Therefore, if the CSO can talk about the overall security spend for the entire enterprise, they can transale that into a discussion about security costs as a percentage of total revenue. As it relates to functional spending, this is a metric that the CFO and CEO are most interested in. Most importantly they can benchmark this internally against what percentage of spend other functions, ie HR, HSE, etc. are relative to total revenue. (It's often possible to benchmark total spend as a percentage of revenue externally with CSO colleagues. Even though we often hesitate to share specific budget numbers, I've always had success talking percentages.) The result is that the CSO will be equipped with sufficient information to analyze (using the ideas in K2's article) where there may be opportunities for reducing security spend across the enterprise which improves overall profitability of the firm. Alternatively, they may learn that they are woefully under spending relative to their peers and use this information to help justify an increase in the security spending. This can be a powerful approach toward building credibility as a business leader. Remember, it's not just about the security budget but, most important to the CFO and CEO is the impact on profitability. After all, isn't profitability the bottom line of what investors are using to judge how effective the CEO is at managing their investments?

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