Foundations for SMB Security in 2026: How to Stay Secure in a Changing Threat Landscape

Cybersecurity is no longer an issue reserved for large enterprises with dedicated security teams. In 2026, small and medium-sized businesses are a primary target for attackers, not because they are careless, but because they hold valuable data and often have limited resources to deal with an attack. The reality for most SMBs is that security must now be treated as a core business function rather than an IT afterthought.

The Threat Landscape

One of the most significant challenges facing SMBs today is the dominance of identity-based attacks. Credential theft and phishing now account for the majority of security incidents, with identity-related compromises accounting for roughly three in five incident response cases.

Phishing in particular has evolved rapidly. AI-generated phishing emails are dramatically more effective than traditional attempts, achieving click-through rates of over 50% compared to around 12% for non-AI-generated messages. The modern working environment only amplifies this risk; employees are interrupted on average every two minutes by meetings, emails, calls or messages, and constant context switching reduces their attention, making it easier for attackers to insert themselves unnoticed into their daily workflows.

In this environment, technology alone is not enough. Security awareness training plays a critical role in reducing human risk by helping employees recognise phishing attempts, social engineering tactics, and identity-based attacks. By sending regular phishing email simulations, organisations can continuously measure and improve user behaviour, reinforcing technical controls rather than solely relying on them.

For SMBs, defending against identity-based attacks increasingly means going beyond basic spam filtering. Modern platforms such as Microsoft Defender provide strong phishing protection technologies to reduce the likelihood of credential compromise. When properly configured, email security becomes a frontline identity control rather than a reactive safeguard.

For many SMBs, Microsoft Defender provides an essential baseline for email and identity protection. However, as phishing attacks become more targeted and harder to distinguish from legitimate business communications, organisations often benefit from extending this capability with advanced email threat protection technologies. These layers build on Microsoft Defender’s native controls to improve detection of business email compromise, impersonation attacks, and zero-day phishing, particularly in high-risk or customer-facing environments.

Security awareness training and simulated phishing campaigns extend these protections by addressing the human layer of defence. By reinforcing what Defender and advanced email threat protection block technically, training helps reduce the likelihood that residual threats result in credential compromise.

Ransomware remains another persistent threat. While the number of ransomware attacks continues to rise, the rate of successful breaches has started to decline. This is largely because ransomware protection is becoming standard in many modern security offerings. However, SMBs that rely on outdated infrastructure or have never tested their recovery plans remain particularly vulnerable. In these cases, ransomware is not just a security issue but an existential business risk, capable of halting operations entirely.

Effective ransomware defence relies on layered protection. Microsoft Defender for Endpoint provides strong core EDR capabilities, while additional EDR tooling can extend visibility and response options for organisations with higher risk profiles, or more complex environments. Combined with tested cloud backup and recovery strategies, this approach improves both prevention and recovery. These tools help SMBs detect and contain suspicious behaviour early, while extended EDR capabilities can support deeper investigation and faster remediation, leading to a more mature incident response process. Segregated and immutable cloud backups ensure that businesses can recover quickly without paying ransoms.

Contributing Factors to the Threat Landscape

A major factor underlying many of these risks is technical debt. Legacy systems and unsupported software continue to be one of the greatest sources of exposure for SMBs. Vulnerabilities in older platforms, such as end-of-life applications and operating systems, regularly appear in breach investigations. These systems are harder to monitor and patch and are often incompatible with modern security tools. Over time, technical debt quietly erodes an organisation’s ability to respond quickly and effectively to threats. Ongoing vulnerability scanning and patch management is critical to reducing this exposure. Many breaches in SMBs stem from known vulnerabilities that remain unpatched.

The same principle applies to users. Without continuous education and testing, risky behaviours persist unnoticed. Phishing simulations provide measurable insight into where users struggle most, allowing targeted training that reduces click rates and improves overall security posture over time, and provides clear metrics for risk and progress.

Continuous scanning and patching help organisations manage technical debt proactively, instead of reacting after an incident. For many SMBs, this is where managed vulnerability scanning and patching services add the most value. By integrating vulnerability management with existing Microsoft Defender telemetry, organisations gain clearer prioritisation of real-world risk rather than relying on disconnected scan results.

At the same time, many SMBs are facing a growing shortage of skilled security staff. Limited headcount and increasing workloads mean that alerts can be missed, response times can slip, and attackers gain more room to operate. This challenge is compounded by the fact that attacks are becoming more sophisticated and harder to detect. Threat actors are combining AI with automation and social engineering, to move faster than overstretched teams can reasonably keep up with.

The Threat of AI

AI itself represents both a challenge and an opportunity for SMBs. On one hand, attackers are already using AI to scale and personalise attacks. On the other hand, AI-powered tools offer SMBs a chance to dramatically improve productivity and security outcomes. AI agents are already shown to boost productivity by as much as 60% without sacrificing performance, yet adoption of AI-driven security tools in the SMB market remains relatively limited. As the AI market for SMBs continues to grow at a rapid pace, those that fail to adopt AI defensively risk falling behind attackers who already have.

AI-driven security platforms, including components within Microsoft Defender, already automate threat detection & response and alert correlation. For SMBs with limited security resources, this automation helps close the gap between attacker speed and defence capacity, without requiring a full security operations team.

Regulatory Pressure

Alongside the evolving threat landscape, regulatory pressure is increasing across Europe and beyond. Regulators are increasingly clear about their expectations: organisations must know, at all times, what data they have, where it resides, and who can access it. This principle sits at the heart of GDPR, NIS2, and DORA.

GDPR fines continue to rise year on year, with a large proportion stemming from failures to comply with core principles such as responding to subject access requests in a timely manner or simply holding data longer than legally permitted. In many cases, these failures are not malicious but result from poor visibility into data and fragmented systems.

NIS2 further expands the scope of regulatory oversight by harmonising security requirements across the EU and strengthening expectations around risk management and incident reporting. Importantly, it applies not only to organisations based in the EU, but also to companies that sell to EU-based businesses. For many SMBs, this means that cybersecurity is now a contractual and supply chain requirement, not just a technical concern.

EU AI Act

The EU AI Act adds another layer of responsibility. With prohibitions on certain AI systems already in effect and broader obligations becoming applicable through 2026, SMBs using AI will need to ensure their systems are transparent, well-governed, and most important of all, compliant. Waiting until enforcement begins is likely to be too late.

The Security Market

Complicating all of this is the fragmented nature of the modern security market. Many organisations now rely on an average of 12 separate tools to secure their environment. While each tool may solve a specific problem, together they often create visibility gaps and operational complexity. For SMBs in particular, fragmented security stacks can slow down response times and make it harder to understand what is actually happening across the business.

The Path Forward

Staying secure in 2026 is therefore less about acquiring more tools and more about building strong foundations. Identity must be protected first, infrastructure must be kept modern and supported, ransomware resilience must be planned and tested, including secure cloud backup and recovery services that operate independently of the primary production environment, and AI must be embraced thoughtfully as a defensive capability.

At the same time, regulatory compliance must be treated as an ongoing operational discipline rather than a one-off project, and security environments must be simplified wherever possible. In practice, backups are not just an IT safeguard but a core security control that underpins business continuity and regulatory resilience.

For SMBs, cybersecurity is no longer just about preventing breaches. It is about resilience and the ability to operate confidently in a more demanding digital economy. Those that invest in solid security foundations today will not only reduce risk in 2026 but also position themselves to grow securely in the years ahead.

Crucially, people must be treated as part of the security system, with continuous awareness training reinforcing technical controls and reducing identity-based risk.

How We Help SMBs Build a Security Strategy That Actually Works

For many SMBs, the challenge isn’t understanding that security is important, it’s knowing where to start and how to make the most of the tools they already own. This is where Dolphin IT Solutions can help. We work with organisations to develop a clear, pragmatic security strategy aligned to their size, risk profile, regulatory obligations, and budget. That starts with understanding how your data is used, where your key risks lie, and how your collaboration tools and security services can be configured to reduce exposure without adding unnecessary complexity.

In practice, this often means helping SMBs simplify fragmented security environments and retire their legacy systems safely. Our security resilience is identity-first and aids with regulatory readiness, ensuring that tools like Microsoft 365 and Google Workspace are not just licensed, but properly governed. The goal is to give SMBs enterprise-grade protection in a way that is manageable and cost-effective.

Where additional risk or regulatory requirements exist, we help organisations extend these foundations with complementary security services. This may include advanced email threat protection layered on top of Microsoft Defender, enhanced EDR for deeper device visibility and threat containment, continuous vulnerability scanning and patch management, security awareness training, and ongoing phishing email simulations. Secure cloud backup and recovery completes this layered approach. These services are designed to integrate with existing platforms rather than replace them, maximising the value of tools businesses already own.

Whether you’re preparing for security audits or trying to reduce risk without overwhelming your internal team, a well-defined security strategy provides the foundation. With the right guidance, SMBs can improve their security posture, stay compliant, and control costs at the same time. Reach out to us today to find out more about how we can help you build your cybersecurity strategy that keeps your business secure in 2026 and beyond.