Digitalization and security – what price is society ready to pay?

Written by
Maria Svanberg
Reading time
3 min

The government has set a goal for Sweden to be the world's most digitalized country. Digitalization is inevitable, but it comes at a high price—not least with the constantly escalating threat landscape. Digital security should be viewed as an investment, not just a cost. Here are some tips along the way.

Common mistakes related to digitalization and risk management

It is common for organizations to rush into digitalization without first conducting a thorough risk analysis. When sensitive processes are digitalized without demanding sufficient security measures, companies risk losing control over critical information. New technology brings both opportunities and risks that need to be identified, documented, and managed in a strategic and informed manner.

The downside of technology

History is full of examples where technology is used in ways that were not anticipated. Gutenberg revolutionized information sharing with the printing press—without imagining its future use for disinformation campaigns. Synthetic fertilizers revolutionized agriculture, before they were used for weapon manufacturing during World War I.

Today, we face the challenge of ensuring that AI-generated information is reliable and not misused to manipulate or harm. Technological advancements rarely bring only positive effects—they also bring potential risks that require proactive management.

Dependency on suppliers

As digitalization increases, so does the dependency on suppliers, who in turn must also meet the organization's security requirements. This requires collaboration across organizational boundaries, a process that can be challenging without established routines. Suppliers with a 'digital monopoly' in various areas, such as Amazon and Google, can also exploit several lock-in mechanisms that create an even stronger dependency on their services and contribute to increased technical vulnerability.

Here are five examples involving major Swedish organizations that clearly show how security is affected not only by technology but also by external suppliers.

  1. A company in a Swedish industrial port was affected by malware that spread internally and had extensive consequences on the trading operations.
  2. Outsourcing of a comprehensive Swedish registry of personal data resulted in sensitive information becoming accessible to non-security vetted personnel abroad.
  3. An unauthorized VPN from a private company provided access to a large government agency's personnel and payroll systems.
  4. A Swedish agency was expelled from its shared IT system due to serious (but undisclosed) security flaws, which they had not addressed despite pressures.
  5. A large government agency outsourced the maintenance of key parts of its own IT system to private companies without security protection agreements.

As our needs evolve with digitalization

As society becomes digitalized, new regulations such as NIS2, DORA, and the AI Act are introduced, aimed at ensuring that society can continue its digital development without compromising security. Alongside the constantly growing threat landscape, there is also an increasing need for proactive security measures in each individual organization.

A robust and secure digital environment is also a prerequisite for innovation and growth.

These measures are crucial for maintaining operational continuity, preserving customer trust, and protecting both users and technical systems. A robust and secure digital environment is also essential for innovation and growth. More and more organizations are expanding their security efforts—not only to meet current threats but also to prepare for future challenges and legislative requirements.

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7 concrete investments to maintain security

Security Software
Includes essential tools such as antivirus, encryption, and firewalls to prevent threats.

For example, secure servers, firewalls, and network equipment that enhance physical security.

Regular staff training on security risks and preventive measures.

Security testing
Third-party audits and penetration tests to identify and address vulnerabilities, using internal or external resources.

Crisis Preparedness
Development of plans and incident management, and costs for external consultants for advice, system monitoring, and crisis exercises.

On-Premise vs. SaaS
The choice between on-premise and cloud services affects both security and costs. On-prem requires investments in facilities, staff, and energy, while cloud services offer better scalability and backup solutions but can present other security challenges.

Cyber insurance that covers damages from data breaches and other security incidents also constitutes a new cost in future security strategies.

Potential costs of not digitizing

Increased manual labor
Without digital solutions, work processes become time-consuming and resource-intensive, leading to higher labor costs and reduced productivity.

Higher error margin
Manual processes result in more mistakes due to human factors. Errors in data entry or document management can lead to costly corrections.

Missed business opportunities
A lack of digital presence and capacity limits a company's ability to reach new customer bases and expand into new markets, resulting in missed potential income and growth.

Problems with storage and traceability
Relying on physical storage incurs significant costs for space and maintenance but also leads to poorer traceability and contributes to inefficient routines, such as in invoice verification.

Fewer informed decisions
Without the ability to quickly collect and analyze data, understanding customer behaviors and market trends becomes a challenge. This can in turn lead to less well-supported decisions and lost competitive advantages.

Do you want to know more about what a risk management system can do for your organization? Read more about Stratsys' products for GRC management here.