The MaRiQ model: A quantitative approach to risk management

Abstract: In recent years, cyber attacks and data fraud have become major issues to companies, businesses and nation states alike. The need for more accurate and reliable risk management models is therefore substantial. Today, cybersecurity risk management is often carried out on a qualitative basis, where risks are evaluated to a predefined set of categories such as low, medium or high. This thesis aims to challenge that practice, by presenting a model that quantitatively assesses risks - therefore named MaRiQ (Manage Risks Quantitatively). MaRiQ was developed based on collected requirements and contemporary literature on quantitative risk management. The model consists of a clearly defined flowchart and a supporting tool created in Excel. To generate scientifically validated results, MaRiQ makes use of a number of statistical techniques and mathematical functions, such as Monte Carlo simulations and probability distributions. To evaluate whether our developed model really was an improvement compared to current qualitative processes, we conducted a workshop at the end of the project. The organization that tested MaRiQexperienced the model to be useful and that it fulfilled most of their needs. Our results indicate that risk management within cybersecurity can and should be performed using more quantitative approaches than what is praxis today. Even though there are several potential developments to be made, MaRiQ demonstrates the possible advantages of transitioning from qualitative to quantitative risk management processes.