An RIA Guide to Deciphering Managed IT, Cybersecurity Operations, and Cyber Governance

Balancing myriad responsibilities is commonplace for executives at Registered Investment Advisor (RIA) firms. From spearheading operations as the Chief Operations Officer (COO) to ensuring compliance and managing IT operations, your role encompasses a diverse array of tasks. However, despite your diligent efforts, challenges like limited resources, an overwhelmed C-Suite, and the absence of dedicated IT personnel persist. Moreover, the impending retirement of senior financial advisors adds another layer of complexity to the equation.  

In response to these challenges, outsourcing critical tasks to a Managed Service Provider (MSP) emerges as a viable solution. Yet, as you embark on your search for the right MSP, you’re confronted with a plethora of terms: Managed IT, Cybersecurity Operations, Cyber Governance. Our mission is to demystify these terms, elucidate their interconnectedness, and highlight the benefits of partnering with a provider capable of delivering all three. 

Managed IT Defined 

Managed IT refers to the practice of outsourcing specific IT tasks and responsibilities for maintaining and managing your firm’s IT Infrastructure, systems and services to third-party service providers. The main objective is to offload the day-to-day management of your IT needs to experts, freeing up valuable time and resources to focus on core investment activities. 

Opting for managed IT services can unlock several advantages for RIAs:  

• Improved system reliability: By outsourcing Managed IT, you can minimize system downtime, errors, and failures, ensuring smooth and uninterrupted operations for your firm. 
• Cost efficiency: Outsourcing IT tasks enables better control and predictability of IT costs, preventing unexpected expenses.  
• Focus on core competencies: By entrusting IT responsibilities to a third-party provider, RIAs can dedicate more attention to core business functions and strategic initiatives.  

Cybersecurity Operations Defined 

Cybersecurity Operations refer to the ongoing processes and activities aimed at protecting your firm’s digital assets, systems, and networks from unauthorized access, attacks, damage, or theft. It is essential to guard sensitive information and maintain the confidentiality, integrity, and availability of data. The key pillars of cybersecurity operations include detection & response, incident response, endpoint detection & response, and a variety of other strategies to fortify against potential threats.  

Safeguarding your clients’ assets and maintaining trust in the integrity of your financial services is a main priority for financial advisors within an RIA. To ensure robust protection against cyber threats, RIAs collaborate with IT and security teams on various aspects:  

• Risk management: Working with the IT and security teams, they assess and prioritize cyber risks, implement suitable security measures, and establish incident response plans.  
• Compliance and legal obligations: RIAs partner with legal and compliance experts to guarantee adherence to relevant data protection regulations and industry standards.  
• Business continuity: RIAs lead the development and testing of disaster recovery plans, ensuring swift and seamless recovery from potential cyber incidents and minimizing operational disruptions.   

Cybersecurity Governance Defined 

Cybersecurity Governance refers to the framework, policies, processes, and procedures to ensure an organization’s cybersecurity strategy aligns with its overall business objectives. It entails defining responsibilities, managing risk and potential cyber threats, and ensuring compliance with regulators.  

For RIAs, implementing effective cyber governance practices is essential for syncing cybersecurity strategies with the firm’s business goals and fosters accountability. This significant principle drives proper cybersecurity management by focusing on the following:  

• Policy development: Collaborating with IT and security teams to create clear and comprehensive cybersecurity policies and procedures, guiding employees on the best practices to follow.  
• Resource allocation: Allocating appropriate resources and budgets to support cybersecurity initiatives and projects so that the organization’s defenses are well-equipped.  
• Employee training: Encouraging cybersecurity awareness training for all employees, cultivating a security-conscious culture within the organization, and empowering the workforce to protect against potential threats.   

How are they all interconnected? 

Managed IT and Cybersecurity Operations
Pairing managed IT and cybersecurity operations under one roof not only streamlines your company’s computer systems but also forms an unyielding shield against potential cyber threats. As discussed in a recent case study, “cyber risk increases when you separate IT management and security operation.” Data shows that multi-vender scenarios response time takes, on average, 40% longer to resolve than when services are consolidated on a single team. Therefore, consolidating these services within one vendor is essential to decreasing the response time in detecting, combating, and recovering from cyber-attacks. 

Managed IT and Cybersecurity Governance
Managed IT and Cybersecurity Governance work hand in hand to ensure that your IT environment is not only efficiently managed but also secure and compliant with regulatory requirements. Managed IT services provide the technical expertise and resources needed to implement cybersecurity measures effectively, while Cybersecurity Governance sets the overarching framework for managing cybersecurity risks and ensuring accountability across the organization. Together, they form a comprehensive approach to IT management and cybersecurity that helps RIAs mitigate risks, protect client data, and maintain regulatory compliance.

The Power Trio: Managed IT, Cybersecurity Operations, and Cybersecurity Governance 

Together, these three components form a cohesive strategy that not only ensures the reliability and security of your technology environment but also enables proactive risk management, regulatory compliance, and strategic decision-making. By integrating Managed IT, Cybersecurity Operations, and Cybersecurity Governance, RIAs can effectively mitigate risks, protect sensitive data, and maintain the trust and confidence of their clients. 

Invest in a Provider That Can Do it All 

Bringing together managed IT, cybersecurity operations, and cybersecurity governance into a unified framework provides a strategic edge for RIAs, fostering seamless collaboration and eliminating the inefficiencies of managing multiple vendors. With cyber threats becoming more and more persistent and sophisticated, the traditional fragmented approach falls short.  

It’s more than just passing off issues; it’s about cohesive teamwork to address evolving challenges. Consolidation with the right partner ensures tight integration and coordination, empowering your organization to proactively counter cyber threats. This approach optimizes efficiency by leveraging shared tools, resources, and intelligence while addressing concerns about conflicting interests within the security realm. 

Parting Insights 

The effectiveness of combining managed IT services and cybersecurity operations presents a powerful solution for RIAs, empowering them to optimize IT management, bolster security measures, and efficiently drive their organization forward. Paired with a comprehensive approach to cybersecurity governance, executives at RIAs can lead their firms toward a secure and successful future in today’s ever-evolving digital landscape. 

Are you prepared to take the next stride in enhancing your IT infrastructure and bolstering your cyber defense? Reach out to us today to get started.