Working backwards, we know that the cost of the average loss in a manufacturing environment is $50 million. We also know that if we encounter one such incident, then we quite likely to encounter two additional loss incidents. In this case, the theoretical potential loss of revenues has now reached $150 million. Now, let us also assume that the cost for a fully functional OPSEC program would be $1 million. While this figure is likely to be high for all but the largest corporations, it is a nice easy round sum to work with in our example.

With this basic information our model would be:

Once we have this, we can calculate probable revenues

So what did our model reveal? If, as in this example, you have $150 million in revenues at risk in an operating unit, your revenues will likely be $75,500,000 higher if you implement an OPSEC program, compared to what they would be if you chose not to implement an OPSEC program.

Is increasing your revenues by $75 million — or some multiple of $75 million — worthwhile?

To answer this, we suggest that you ask yourself several questions:

• How much would you spend on advertising to increase revenue by $75 million?
• What would the company spend in order to cut costs by $75 million?
• If revenues increased by $75 million in each non-related manufacturing division, how would this affect shareholder value (earnings per share)?
• If revenues increased by $75 million in each non-related manufacturing division, how would this affect the value of dividends paid per share?