Nine Best Practices to Mitigate Cybersecurity Risks for Outsourced E-commerce Processes

A BPO company in Phoenix provides e-commerce outsourcing services to help businesses manage customer service, help desk, sales support, logistics, and bookkeeping functions. Partnering with a service provider offers benefits like reduced operating costs and better focus on core competencies. 

However, outsourcing also poses numerous risks, particularly in terms of data security. Online threats can result in high financial consequences, so how can you address them?

This article shares valuable pointers on how you can mitigate cybersecurity risks when outsourcing e-commerce processes. Keep reading to learn more.

How to Mitigate Cybersecurity Risks When Outsourcing E-Commerce

Consider these nine best practices to mitigate cybersecurity risks when outsourcing e-commerce services:  

1. Examine Potential Outsourcing Partners

Prioritize screening prospective service providers to mitigate the cybersecurity risks of outsourcing. After all, you share private and sensitive business and customer data with the remote business process outsourcing (BPO) company. Vetting every potential partner and determining their safety and security levels is necessary.

Consider these tips for assessing BPO providers:

• Determine industry background. Opt for a third-party provider with in-depth knowledge of your industry to properly manage the assigned processes. Ask candidates about their track records, project histories, and the team’s qualifications. Contacting past and current clients to get feedback about working with the provider is also essential.
• Check technical competence. Short-list candidates that give convincing answers to your toughest technical questions, particularly in cybersecurity, network, and data management. Inquire about their industry-recognized technical credentials and business continuity and disaster recovery plans. Request case studies as supporting data. 
• Inspect infrastructure and technology. Ensure the potential partners are technologically prepared to address your data security needs. Prioritize those with the latest and most reliable information technology (IT) network. Their systems must also be compatible with yours for smooth integration. 
• Assess communication and client management processes. Pick providers with multiple communication channels for quick, seamless, and simplified interaction. Ask them to designate a manager as the main contact person for all concerns and issues regarding cybersecurity and other outsourcing-related matters. 

2. Define Security Requirements

One way to mitigate cybersecurity risks for e-commerce customer service outsourcing is by determining the level of data security your business requires. 

Suppose your online business requires cybersecurity. How much data or network security is needed remains to be seen. You must properly balance security needs and your current budget to avoid overspending and impacting your income. 

Check out these useful pointers to find the suitable level of protection when mitigating cybersecurity risks for e-commerce outsourcing:

• Evaluate the current protection status. Determine the data security required before upgrading or installing a new cybersecurity system. Analyze the security setup thoroughly, from the minor ones to the primary ones. Review existing protocols and decide which systems should be offline or online to manage access. 
• Set goals and list reasons. Establish the objectives and reasons for upgrading or deploying the cybersecurity platform. Is it to protect online customers from data theft or scams, your operation’s most common problem? Or is it to minimize ransomware incidents that have victimized some of your employees? 
• Collaborate with the BPO partner. Consult with your service provider. It will offer outsourced customer service tips and provide you with IT experts to help you brainstorm and formulate cybersecurity strategies. 

3. Develop and Implement Strong Contractual Agreements

Draft and sign a solid BPO agreement with the service provider. Include data protection and compliance terms in the contract to mitigate the cybersecurity risks of outsourcing. Also, ensure the official deal is as extensive as possible so that every potential scenario has recommended solutions. 

Clarify in your outsourcing agreement how your business, customer, or client data will be accessed, utilized, or transferred. Partnering with a third-party provider, such as an offshoring provider in the Philippines, means entrusting private information like passwords, financial accounts, and personal profiles.

Since everything is in writing, your partner can be penalized if it violates the contract’s data security clause. The agreement gives you a certain degree of control over the shared data. 

Here is an example of data protection and compliance clauses to include in an IT outsourcing agreement:

• Data protection: The BPO shall implement and sustain a complete written information security program consisting of proper security measures to protect the personal information of the Company’s employees, officers, directors, and stakeholders that the BPO processes, stores, and obtains regarding the outsourced technical services. 
• Data compliance: The BPO shall comply with the Data Protection Act of 1998 and any other data protection regulation that may be relevant. 

Additionally, ensure that the contract covers compliance with relevant laws to mitigate the cybersecurity risks of e-commerce outsourcing. Meeting all government regulations and industry standards to improve data security and avert costly fines is crucial.

4. Conduct Regular Risk Assessments

Executing a threat assessment is one way to mitigate the cybersecurity risks of outsourcing. This process analyzes your company’s vulnerabilities to present a precise understanding of the risks and the possible damage they might incur. 

Risk assessments give you a comprehensive picture of the network infrastructure from the standpoint of an online attacker. It is a useful method that can serve as the foundation of a risk management plan and will assist managers in dealing with detected risks.

Here are four steps to conduct this process and mitigate the cybersecurity risks of e-commerce outsourcing:

• Make a complete list of IT resources. Inventory all your IT assets, including hardware, software, other computer systems, and the third-party infrastructure you lease (e.g., software as a service). 
• Identify and evaluate the risks. Classify risks, such as “data threats” and “hardware threats,” and rank them according to severity. Determine how hackers can intrude on your IT resources. Know and estimate the impact or damage if such an intrusion succeeds. 
• Prepare security measures. Specify security controls to help minimize potential risks. Some examples are firewall configuration, in-transit and at-rest encryption, multi-factor authentication, and programs against ransomware, phishing, and malware. 
• Track and measure performance. Monitor your risk assessment processes and gauge their effectiveness. Tracking must be ongoing, as threat actors might keep hacking your system and changing tactics.

5. Enforce Strong Access Controls

Deploying access control can mitigate the cybersecurity risks of outsourcing since this approach limits access to IT resources or assets. This security feature decides who has access to which data, applications, and tools and under what conditions.

The purpose of access control is to protect valuable data from the reach of malicious actors. Unwanted consumer and staff information disclosure, intellectual property losses, and financial resource losses are some adverse effects when sensitive data is compromised.

Below are ways to implement access control to mitigate cybersecurity risks for e-commerce outsourcing. Discuss them with the service provider. 

• Apply various security layers. Be less dependent on single authentication. Develop extra layers of security with tools, including multi-factor authentication, to reinforce access control. Threat actors will find bypassing a system with multiple stages more difficult. 
• Limit access privileges. Instruct your BPO partner to restrict access to your system. Allow users access to sections that are relevant to them. Prohibit them from looking into unrelated segments. Doing so assists in tracking activities in your system and minimizing any harm if an account is attacked.
• Assign each user a single username and password. You must provide every third-party professional with a login name and secure password. If something goes amiss, you can pinpoint specific users to resolve the issue accurately and swiftly. 

6. Monitor and Log Activities

Develop and deploy a logging and monitoring solution to mitigate cybersecurity risks when outsourcing. This approach can help the service provider detect potential security issues, identify anomalies in network systems, and prevent security incidents from becoming full-blown problems.  

Here are the benefits of monitoring and logging activities to help mitigate cybersecurity risks for e-commerce outsourcing:

• Faster recovery. It would be best to avoid downtime. Audit logs can help speed up and improve the recovery procedure. They can aid in restoring missing or damaged data files by reverse engineering the alterations registered in the logs.
• Improved security breach detection. Outsourced processes are not invulnerable to various security incidents. Monitoring and logging activities can assist in defending against malicious external threats. They can also protect your system against internal data misuse, spotting these issues in real time for a quick resolution. 
• More detailed information on security incidents. If a breach happens, audit logs can help recreate the activities that resulted in the attack. IT administrators can understand how the intrusion happened and how to address the risks. Your service provider can explain the incident and their efforts to avoid reoccurrence.
• Customized alerts. While it can identify potential security risks, the log monitoring system can also alert the IT team to resolve the issue before it becomes a major problem. The team can apply the solution immediately and help mitigate the cybersecurity risks of outsourcing.

7. Encrypt Sensitive Data

Adopting data encryption is one way to mitigate cybersecurity risks when outsourcing. It protects against unauthorized use of files within your organization and from outsiders. The security procedure converts plain-text data into an unintelligible format that only someone with the necessary decryption key can view.

Explore some data encryption methods to mitigate cybersecurity risks for e-commerce outsourcing: 

• Secure data in transit. Data saved on computer systems or private servers is more protected than files in transit. If data is regularly transferred between areas, installing a virtual private network to conceal your IP address is recommended. 
• Specify the files to encrypt. Identify the data that is most crucial to protect. Consider the files that can cost you the most money and harm your reputation if breached. Client and customer names, contact details, credit card numbers, and bank accounts must be encrypted, regardless of your data security setup. 
• Control access to information. Allow users to obtain encryption keys based on their required data. Limit a person’s access to the files. For instance, employee information must only be available to staff working in the human resources department. However, your team cannot access the employees’ banking details. 
• Make a backup. In the case of loss or theft, be certain that you can retrieve records or the keys used to encrypt the data. Secure all decryption keys and files, and make a backup. Keep your decryption keys separate from your backup.

8. Establish Incident Response Protocols

Executing incident response plans is among the ways to mitigate cybersecurity risks for outsourcing. This approach initiates active measures to thwart a data breach and minimize the impact. Consider using response plan templates to quickly build and implement protocols suited to your business needs.

Consider these ways to build solid incident response protocols:

• Form an incident response team. Prepare to deal with future active threats. Build an incident response group and assign members’ duties and responsibilities during an active threat according to skills. Designate someone immediately to handle the issue and minimize the damage. 
• Assess security incidents. Use relevant software and monitoring tools to determine potential threats. These applications can detect issues in real time, enabling the team to find solutions.
• Keep incidents, actions, and assailants under control. Contain harmful activities during an intrusion. Evaluate their intensity and protect critical IT resources by conducting a quick triage to mitigate cybersecurity risks for e-commerce outsourcing. 
• Eliminate threats. Concentrate on removing the risk. Apply measures such as deleting the identified malicious software, installing patches and updates, and implementing a more stringent and better configuration.
• Measure the impact and recover. After the elimination, gauge the financial and technical impact of the attack on your organization. Try to recover from the intrusion as quickly as possible and learn from it.

9. Conduct Security Awareness Training

Security awareness training is an approach that must be used by your company and your customer-centric outsourcing partner to mitigate the cybersecurity risks of outsourcing. This strategy significantly contributes to fighting online attacks and data breaches. 

Effective security awareness training educates staff, shareholders, managers, and customers regarding threats and how to minimize or avoid them. Being well-informed about security reduces human errors and negligence.

Use the following tips to mitigate cybersecurity risks for e-commerce outsourcing and other subcontracted functions: 

• Engage everyone. Security awareness training is not just for managers and executives. Entry-level and third-party workers must also be involved and educated, including customer service representatives, technical support agents, and data encoders.
• Master the basics. Help all participants grasp the fundamentals of data security and remember them. Essential information includes password security methods and anti-phishing, scamming, and ransomware tactics. 
• Test their knowledge. Short tests, simulations, and group games are proven ways to apply the information the workers learned from the training. After the training, you and the BPO provider should monitor whether security awareness improves or remains the same. Also, training must be continuous. 

The Bottom Line

Choose the best practices that apply to your business. Discuss with the service provider how to incorporate them into your cybersecurity policies. Cybercriminals, malicious hackers, and other threat actors continue improvising and seeking ways to intrude on their targets. 

As such, you and the BPO partner must be on guard against hackers by regularly updating and enhancing data security systems, protocols, plans, and strategies. Include employees at all levels because they are the most vulnerable part of the cybersecurity plan. 

Let’s connect to learn more about mitigating cybersecurity risks when outsourcing e-commerce processes!