Red Teaming Isn’t Just for Hackers—It’s for CTOs Who Lead

Key takeaways

• Red team exercises expose blind spots that traditional audits or penetration tests miss.
• They are not just technical drills but strategic tests of resilience, leadership, and communication.
• For CTOs, red teaming is a way to align security posture with business priorities.
• The value lies not only in the findings but in how organizations act on them.

When a major incident hits, it rarely plays out the way technical teams imagine. The headlines from the SolarWinds supply chain attack or the Colonial Pipeline ransomware crisis weren’t about the technical exploits themselves. They were about the aftermath: slow decision-making, confusing communication, public panic, and regulators demanding answers. In both cases, technical vulnerabilities may have opened the door, but it was the lack of executive preparedness that amplified the damage.

This is where many leadership teams get caught off guard. They assume security drills belong in the server room, when in reality, incidents escalate quickly into boardroom problems. Reputational fallout, customer trust, market impact, and regulatory exposure—all of these land squarely in the hands of executives. And without preparation, executives often default to improvisation, which usually creates more chaos than clarity.

That’s why red team exercises matter. They aren’t just about testing firewalls or phishing defenses; they are about stress-testing leadership itself. They reveal blind spots that no audit or compliance checklist can capture. They show how quickly—or how poorly—decisions flow in a crisis. And they force leadership teams to align business priorities with security realities.

So let me make my case clearly: red team exercises are not optional. For CTOs, they are a board-level priority—a structured way to test resilience, expose weaknesses, and make sure the next crisis becomes a story of preparedness rather than preventable disaster.

Why CTOs should care

Cyber risk is business risk. Breaches and outages erode reputation, undermine customer trust, and attract regulatory scrutiny. McKinsey ranks cyber resilience among the top concerns for enterprise leadership, while Gartner repeatedly highlights that executive-level misalignment is one of the biggest obstacles to effective response.

Unlike audits or penetration tests, red team exercises expose the interplay between technology, people, and processes. They don’t just ask: “Can we be hacked?” They ask: “If we are, can leadership guide the response in a way that protects business outcomes?”

At Netguru, we’ve seen this firsthand in fintech projects. Technical fixes alone are not enough—leadership involvement in red team scenarios dramatically accelerates remediation. More importantly, it builds cultural change: executives and engineers begin speaking the same language when it comes to risk and resilience.

What a red team exercise looks like

A red team exercise typically follows a structured arc. First, leadership sets the goals: which systems or business functions should be tested, and what outcomes matter most. Next comes the adversarial simulation, where an internal or external team emulates real attackers—leveraging tactics from frameworks like MITRE ATT&CK or NIST’s adversarial simulation guidelines. Detection and response are tested in real time, and finally, the organization debriefs: what worked, what failed, and how leadership decisions shaped outcomes.

This is where red teaming diverges sharply from penetration testing. A pentest is about finding technical flaws—an unpatched server, a misconfigured firewall. Red teaming is holistic. It asks how well your people detect threats, whether escalation paths work, and whether executives communicate with clarity under stress.

Leadership plays a central role here. They set objectives, ensure business priorities guide the exercise, and—crucially—take part in the debrief.

This isn’t something new, many enterprises have implemented it already. Here’s some examples:

• Microsoft developed one of the most mature red team programs in the industry. Its internal exercises revealed systemic gaps in detection and incident handling, helping shape cloud security practices that later became industry standards.
• Bank of England introduced the CBEST framework, making red team testing mandatory for financial institutions. This shifted red teaming from a “nice-to-have” to a regulated necessity, acknowledging its role in systemic risk management.
• Dropbox built an internal red team that influenced company-wide culture. By involving leadership in simulations, Dropbox turned findings into cross-functional improvements rather than siloed technical fixes.

Core components of an effective red team program

An effective program has several moving parts, all tied to business priorities.

Clear scope and objectives. Every exercise starts with clarity. Is the goal to test resilience of a payment platform? To measure how quickly executives can communicate with regulators? Red teams should align their simulations with what matters most to the business.

Cross-functional participation. IT and security teams can’t be the only ones in the room. Legal, compliance, communications, and leadership must all participate. Cybersecurity incidents rarely stay contained in technical silos—they spill into the public, legal, and regulatory domains.

Controlled adversarial simulation. The exercise must be realistic but safe. Attackers simulate tactics, techniques, and procedures (TTPs) without causing lasting harm. The aim is to surface blind spots, not to bring systems down.

After-action reviews. The real value comes in the debrief. Leaders must examine not just technical findings but also communication breakdowns, decision bottlenecks, and cultural gaps.

Ongoing integration. Red teaming is not a one-off event. Findings must feed back into risk management, security roadmaps, and leadership training. Otherwise, lessons fade and vulnerabilities persist.

What should you do as a CTO?

For CTOs, red teaming is about setting the tone and ensuring alignment.

Treat exercises as strategic investments. Red teaming reveals weak spots in resilience and culture that no audit will catch. Done right, the ROI is measured in avoided breaches and preserved trust.

Involve the board and executives. Security is not siloed. When the board sees real-world attack scenarios play out, it reframes cybersecurity as a strategic concern rather than a cost center.

Run exercises regularly. One test is not enough. Mature organizations escalate the complexity of simulations over time, ensuring resilience keeps pace with evolving threats.

Turn results into action. Reports are worthless if they sit in a drawer. CTOs must champion remediation, follow-ups, and cultural change.

At Netguru, we recommend embedding red team programs into digital transformation journeys, particularly in fintech and SaaS. These sectors face stringent regulatory scrutiny and fast-moving competition—security resilience becomes a differentiator, not just a compliance checkbox.

The biggest mistake we see is treating red teaming as a technical drill. The most valuable lessons emerge when leadership takes part, stress-tests decisions, and commits to cultural change.

Now that you know…

Red team exercises are far more than technical simulations. They are leadership stress tests, revealing whether an organization can withstand real-world attacks and protect what matters most.

What we can learn from Microsoft, Dropbox, and financial regulators is clear: ignoring red teaming is ignoring risk. Organizations that invest in structured, recurring simulations build not only stronger defenses but also stronger decision-making cultures. Those that delay or deprioritize red teaming often find themselves improvising in the spotlight, with customers, regulators, and investors watching every move.

For CTOs, what you have to do now is simply practical and achievable. Start with a pilot exercise that focuses on a critical system or business process. Involve leadership from the outset, not just in the debrief. Escalate the complexity of exercises over time—testing not only detection and response but also communication protocols, regulatory readiness, and board-level decision-making. And most importantly, integrate findings into strategic decision-making. Red team results should be treated as business intelligence, shaping priorities and investments, rather than filed away as technical notes.

Our experience in fintech and SaaS already has shown that the organizations that mature fastest are those that make red teaming part of their culture. They treat every exercise as an opportunity to strengthen collaboration between technical and non-technical teams. They update their playbooks, refine their escalation paths, and build confidence that when—not if—the next incident comes, leadership will know what to do.

Because the truth is unavoidable: incidents will happen.

The only variable is how prepared your organization is to face these incidents. And when that moment arrives, the way leadership responds will define the outcome. And red teaming ensures that the outcome is resilience.