Phishing Simulations: The Hidden Risks Companies Should Know

14 Nov 2025


The threat of cyber attacks is ever-present and evolving in today’s modern age. Among the many tactics deployed by malicious actors, phishing remains one of the most prevalent. Disguised as messages from trusted entities and individuals, these social engineering attacks aim to steal confidential information or compromise systems via deception.

In response, many organisations have included phishing simulation programmes alongside other essential cybersecurity services in their defence strategy. At first glance, this seems to be a logical step: train employees by exposing them in a safe environment to phishing-style emails so that they can recognise the real thing. But unless carefully designed and managed, such simulations may do as much harm as good.

How phishing simulations can help an organisation

Phishing simulations can offer real benefits when implemented thoughtfully. They are designed to teach employees the nuances of recognising and responding to phishing attempts, skills that are difficult to develop through theory alone. By delivering a hands-on learning experience, simulations give employees the opportunity to safely make mistakes and learn from them in real time.

From a business perspective, simulations can serve as an early warning system. They help identify individuals or departments most vulnerable to phishing attacks, enabling targeted follow-up training and risk mitigation. In this sense, phishing simulations function much like penetration testing in Singapore, where organisations regularly conduct controlled “attacks” to expose weaknesses before real adversaries can exploit them.

Furthermore, when run periodically, phishing simulations help keep cybersecurity awareness top-of-mind. As phishing tactics evolve, these exercises ensure that employees remain vigilant, informed, and adaptable. They also generate valuable data, allowing IT teams to evaluate the effectiveness of current defensive tools, from email filters to authentication systems.

Ultimately, by reducing the likelihood of employees falling for phishing scams, organisations can protect sensitive data, uphold regulatory compliance, and avoid the reputational and financial damage that accompanies a data breach. In this ideal scenario, simulations act as a proactive defence mechanism, one that reinforces, rather than undermines, overall security posture.

Who conducts phishing simulations?

Phishing simulations are typically carried out by a company’s internal IT or information security team, although many organisations now prefer to engage third-party providers specialising in cybersecurity. These providers often offer more sophisticated tools and up-to-date phishing templates that closely mirror current real-world threats.

Larger corporations might integrate phishing simulations into their broader security awareness programmes, using dedicated software platforms to design, send, and track campaign results. These platforms provide analytics on employee behaviour, such as click rates, reporting rates, and response times, to measure the effectiveness of training efforts.

For smaller companies without a dedicated security team, outsourcing can be an effective solution. Professional cybersecurity consultants can tailor simulation campaigns to align with the organisation’s industry, internal culture, and threat landscape. Ultimately, who conducts the simulation matters less than how it is conducted.

Why phishing simulations can be counterproductive

Phishing simulations work on a reasonable assumption: by familiarising employees with fake phishing emails, they will naturally become better at spotting genuine ones. However, research and real-world experience suggest this assumption doesn’t always hold true.

Studies have shown that employees who consistently identify simulated phishing emails can develop a dangerous sense of overconfidence. They begin to believe that all phishing threats will resemble those seen in training, potentially overlooking novel or more sophisticated attacks. Ironically, a tool intended to improve awareness may inadvertently foster complacency.

Then there’s the issue of stress. Constant exposure to simulated attacks can create a climate of anxiety and mistrust. Employees may start to question every email, fearful that an innocuous message could be another “trap.” Over time, this heightened caution can erode productivity and communication efficiency. The very culture of collaboration that cybersecurity aims to protect may instead become fragmented by suspicion.

Moreover, the relationship between employees and IT teams can deteriorate. When simulations are perceived as “gotcha” tests rather than learning opportunities, staff may begin to see cybersecurity personnel as adversaries, not allies. This breakdown of trust can be far more damaging than any single phishing incident.

Adding to the complexity is the blurring line between legitimate and malicious digital communications. Modern phishing emails often mimic genuine company notifications, software updates, or even internal HR messages. For an employee who has been conditioned to be overly cautious, distinguishing real from fake becomes increasingly difficult and may sometimes lead to the inadvertent ignoring of legitimate, business-critical communications.

How phishing simulations may erode organisational trust

Organisational trust and morale are invaluable assets. They are built over years of consistent leadership, transparency, and collaboration. However, they are fragile and can be undermined in an instant by practices that appear manipulative. Poorly executed phishing simulations fall squarely into this category.

Consider what happens when an employee receives an email promising a long-awaited company bonus or promotion, only to discover it was a test. What may have been intended as a harmless lesson could instead feel like a betrayal. Employees not only feel deceived but also humiliated for failing to detect the ruse. Over time, such tactics may breed resentment, disengagement, and a decline in workplace morale.

Furthermore, when employees begin to doubt the authenticity of internal communications, the effects ripple through the organisation. Team cohesion weakens, collaboration slows, and even critical directives from management may be met with scepticism. A security strategy that damages organisational trust undermines its own purpose: a united, vigilant workforce.

Key tips to consider moving forward

Phishing is undeniably a serious threat, but it is only one piece of the ever-expanding cybersecurity puzzle. An over-reliance on phishing simulations risks narrowing an organisation’s focus to a single attack vector while neglecting others, such as malware, ransomware, or insider threats.

For simulations to truly be effective, organisations should:

1. Prioritise context and realism – Design phishing tests that reflect actual risks your company faces rather than generic, easily spotted examples.

2. Emphasise education over punishment – Treat failed simulations as opportunities to learn, not as grounds for disciplinary action.

3. Integrate with broader security initiatives – Combine phishing simulations with regular training, clear reporting mechanisms, and updated technical defences.

4. Communicate openly – Ensure employees understand the purpose and benefits of simulations to maintain trust and buy-in.

5. Measure and adapt – Use data from simulations to improve (not just repeat) the process.

Phishing simulations, despite their good intentions, can easily become counterproductive if mishandled. Organisations must re-evaluate their methods, ensuring that awareness training complements a holistic cybersecurity strategy.

Conclusion

Phishing simulations are neither inherently good nor bad; they are tools whose value depends entirely on their design and execution. When implemented with transparency, empathy, and a focus on learning, they can strengthen an organisation’s first line of defence: its people.

However, when used carelessly, they risk doing the opposite: breeding mistrust, complacency, and confusion. The future of phishing training lies not in tricking employees into making mistakes, but in empowering them to make informed, confident security decisions every day.

At Group8, we recognise that every business faces unique security challenges, which is why our team tailors cybersecurity strategies to your specific environment to ensure that protection aligns seamlessly with your operations. From proactive threat hunting to strategic advisory, we empower you to stay confident in a connected world. Reach out to hello@group8.co, and let’s build your defences together.