Many organizations are considering outsourcing some or all of their security functions in order to reduce costs. While there are some potential advantages to outsourcing security, such as gaining access to specialized expertise and freeing up internal resources, there are also some significant potential disadvantages that must be carefully considered. In this article, we will provide an overview of some of the key disadvantages of outsourced security services.
Loss of organizational knowledge and control
One major risk of outsourcing security is that it can result in a loss of organizational knowledge and control. When security functions are handled by an outside vendor, over time much of the internal expertise and knowledge needed to manage those functions can be lost. This makes it more difficult for the organization to evaluate the quality of the services being provided or bring security back in-house if needed. Relying on an external provider also means the organization loses some control – the vendor has its own processes, tools and staff that may not fully align with the organization’s needs and standards.
Communication and coordination challenges
Effective security requires close coordination between security staff and other teams within the organization, such as IT, compliance, legal, and business units. When security is outsourced, it can be much more difficult to maintain open and efficient communication across these groups. Security staff at an external provider may not have the context or insights needed to fully understand the organization’s environment and needs. Important information can fall through the cracks when multiple parties have to communicate through formal channels rather than working side-by-side.
Vendor lock-in
Once an organization outsources a major security function like SOC monitoring or incident response, switching providers down the road can be extremely challenging. The new vendor has to be thoroughly trained on the environment and security program specifics. Transitioning large amounts of data and institutional knowledge is labor intensive and risky. Many organizations end up stuck with a vendor even if they are dissatisfied with the service quality or costs, simply because the barriers to switching are so high.
Cost escalation and hidden fees
While cost reduction is often a driver for outsourcing, costs can quickly escalate beyond initial projections. Contracting practices in the security services industry often allow vendors to increase fees on annual renewals without much customer recourse. Some providers utilize vague language around service levels and responsibilities that allow them to charge extra fees for additional services later on. Organizations can end up locked into contracts that cost far more than expected.
Compliance and legal risks
Handing off security functions to a third party introduces potential compliance, regulatory and legal risks. It may be unclear who is ultimately liable if a breach occurs. Auditors may have concerns about visibility into the controls implemented by the vendor. Local laws around data sovereignty and privacy come into play if customer data is stored or accessed from overseas locations by the provider. Thorough vetting of providers as well as air-tight contractual terms are a must, but even then uncertainties will remain.
Disadvantages of Outsourced SOC Services
Loss of internal expertise
Outsourcing security operations center (SOC) services often results in a gradual decline in an organization’s internal detection and response capabilities. With no SOC team in-house, important institutional knowledge gets lost over time. If the contract eventually gets terminated, rebuilding SOC expertise from scratch can be an enormous undertaking.
Lack of business context
External SOC analysts will never have the same level of understanding of the organization’s IT environment, critical assets and business priorities as internal staff. This makes it harder for them to identify, interpret and prioritize incidents accurately. Important context can get lost when communicating and coordinating across organizational boundaries.
Inflexibility
Since outsourced SOC services are designed to serve a wide range of customers, they tend to rely on predefined processes and tools that may not suit an organization’s specific needs. Customization is usually limited. Organizations get locked into the vendor’s approach which can become outdated as attacker tactics evolve.
No cost savings
While outsourcing SOC services eliminates personnel costs, external services tend to have high pricing models and minimum commitments. With hidden costs and unexpected fees, many organizations find that outsourcing costs significantly more than building internal SOC capabilities.
| Disadvantage | Description |
|---|---|
| Loss of internal expertise | Outsourcing leads to decline in in-house detection and response skills over time |
| Lack of business context | External analysts lack insights into organization’s IT environment and priorities |
| Inflexibility | Vendor’s predefined tools and processes may not suit organization’s specific needs |
| No cost savings | High pricing models and hidden fees outweigh personnel cost savings |
Disadvantages of Outsourced Incident Response
Slow response times
External incident response teams are unable to start investigating and containing a breach as quickly as internal resources since they are not onsite. This allows greater spread of malware and loss of sensitive data. Slow response erodes trust in the organization after a breach.
Lack of familiarity
Because they do not work regularly with the organization’s systems and networks, outsourced incident responders have a steep learning curve in understanding the IT environment, potential vulnerabilities and highest-risk areas. This slows down response.
Communication barriers
Collaborating effectively across organizational boundaries can be challenging for outsourced responders. This can impede information sharing and coordination with internal teams during high-stress, time-sensitive incidents.
No retained knowledge
After an incident is resolved, the external responders move on. There is little retained familiarity with the organization’s vulnerabilities and lessons learned that could improve future response efforts and strengthen defenses.
| Disadvantage | Description |
|---|---|
| Slow response times | External teams cannot start investigating and containing breaches as quickly as internal resources |
| Lack of familiarity | Outsourced responders have learning curve in understanding organization’s IT environment |
| Communication barriers | Collaborating across organizational boundaries can impede coordination |
| No retained knowledge | Little familiarity retained to improve future response efforts |
Disadvantages of Outsourced Penetration Testing
Limited scope
Outsourced penetration tests are typically limited in time and scope. Testers only have access to certain systems for a short period like 1-2 weeks. This results in incomplete evaluation of the organization’s security posture. Major gaps may go undiscovered.
Lack of insider knowledge
External pentesters do not have background knowledge of legacy systems, insider threats, physical security weaknesses and other organization-specific vulnerabilities that could be exploited. Their tests may miss many real-world risks.
No ongoing testing
Point-in-time pentests provide only a snapshot view of vulnerabilities under specific conditions. As personnel, systems and processes change over time, new exposures arise that outsourced tests will miss until the next annual test.
Communication gaps
Information discovered during tests flows primarily one way from the external testers back to the organization. Insights into exploitation details, defense recommendations and remediation support may be lacking.
| Disadvantage | Description |
|---|---|
| Limited scope | Time and scope constraints result in incomplete evaluation of security |
| Lack of insider knowledge | External testers unaware of organization-specific vulnerabilities |
| No ongoing testing | Point-in-time tests miss vulnerabilities arising over time |
| Communication gaps | Information flows one way with little remediation support |
Other Disadvantages
Diluted focus on security
Reliance on external providers can lead to a sense that security is “someone else’s problem.” Internal culture and involvement in protecting the organization’s assets can suffer when security is entirely outsourced.
Vendor instability
Smaller security firms are often acquired, go out of business or have significant turnover. This can disrupt services and require transitions between providers, costing time and money.
Unclear liability
When breaches or regulatory violations occur, blame games ensue between the organization and provider. Unclear liability means delayed notifications, disjointed public messaging and damaged trust.
Noncompetitive pricing
Mature security services tend to be dominated by a few large providers. This concentration means organizations face noncompetitive pricing and fewer alternatives if they become dissatisfied.
| Disadvantage | Description |
|---|---|
| Diluted security focus | Over-reliance on external providers reduces internal security culture |
| Vendor instability | Churn among small providers disrupts services and requires transitions |
| Unclear liability | Blame games between organization and provider damage trust after incidents |
| Noncompetitive pricing | Mature services dominated by few large vendors limits alternatives |
Conclusion
While outsourcing security functions like the SOC, incident response and penetration testing can offer some benefits like cost savings and access to specialized skills, there are also considerable disadvantages organizations should carefully weigh. Dependency on external providers can erode internal expertise over time, undermine visibility and control, and create risky over-reliance. Outsourced services may lack critical business context, become inflexible and expensive over time, and introduce uncertainty around liability and regulatory compliance. Diluted security focus and instability among providers can also weaken defenses. Organizations exploring security outsourcing need to perform thorough due diligence and develop plans to mitigate the key disadvantages and risks.
