While the world is becoming increasingly interconnected and digitised, globalised economies rely on robust and resilient supply chains. However, this digitisation exposes businesses to risks as they must navigate complex and sophisticated supply networks. This leaves the door open for supply chains to be a prime target for cyber criminals seeking to exploit the industry’s vulnerabilities and capitalise on this digital transformation.
Cyber threats on the rise
As the number of cyber attacks continues to increase each year, it’s paramount to deploy and enforce cybersecurity measures in global supply chains. Hackers’ methods constantly evolve, ranging from data breaches and stolen security certificates to malware and ransomware attacks, targeting manufacturers, suppliers, and third-party providers. Just look at the average cost per data breach globally, which amounted to a staggering 4.45 million dollars last year.
Adding to the urgency of this issue, Resilinc – the global leader in supply chain mapping, risk monitoring, and resiliency analytics – reported a 36% surge in cyber attacks in 2023 compared to 2022. Over 12 months, Resilinc’s 24/7 risk monitoring platform, EventWatchAI, identified 703 potentially disruptive cyber attacks worldwide across all tracked industries. Of the alerts, more than 57% triggered a WarRoom – meaning that there was a confirmed impact on the supply chain.
With so much at stake, future-proofing supply chains through strategic and proactive cybersecurity measures is critical. But what steps can organisations take to minimise cyber threats and enhance the resilience of their supply chains? Here we will delve into four key elements that any cybersecurity strategy should include.
- Building transparency: multi-tier mapping
Every company should begin its journey toward increased cybersecurity by improving the transparency and visibility of its supply chain. A necessary first step in achieving this is to map out the entire supply network. Importantly, given that as much as 85% of disruptions arise from tier 2+ suppliers, it is crucial to go beyond direct high-volume suppliers and map indirect sub-tier vendors as well. Mapping offers the visibility and information needed to make data-driven decisions about who to work with and what changes to implement if cybersecurity issues emerge.
- Screening disruptions: AI-powered monitoring
The next integral step is gaining real-time insight into potential disruptions that could impact supply chains. Be it natural disasters, geopolitical issues, or cyber attacks, having continuous 24/7 access to information on global events means staying one step ahead of the disruption. AI-powered monitoring tools equipped with predictive analytics capabilities enable a level of automation where decisions are made in a split second, even before disruption unfolds.
- Conducting cyber assessments for continuous improvement
Another essential best practice is to conduct thorough and ongoing cyber assessments of systems. These can unveil security gaps that need attention and lay the groundwork for enhanced security measures. By continuously evaluating and refining processes, organisations can ensure that their systems and their suppliers’ systems are up-to-date and resistant to breach attempts. Cybersecurity assessments must be collected from both direct and indirect tiers of an organisation’s supply chain, with updates occurring at least every six months.
- Creating a crisis-ready contingency plan
Finally, an effective risk mitigation strategy should include a contingency plan. Companies need to proactively determine steps to take in the aftermath of a potential cyber breach, focusing on people and processes. They must ensure their employees know how to swiftly respond and have the necessary processes in place to effectively mitigate the negative impact of a cyber attack.
What does the future hold?
As supply chain management shifts from a reactive to a proactive approach, cybersecurity is a key risk area where this change is crucial. Artificial intelligence will play a vital role in driving it further.
AI will enable the development of powerful solutions used to optimize supply chains for a variety of risk mitigation strategies, including cybersecurity. It will also facilitate the creation of digital supply chain twins that can accurately simulate and remediate supply chain disruptive risks, including cybersecurity. Generative AI trained on massive amounts of data from the Internet and augmented with search capabilities will provide in-depth insights into suppliers’ past problems, allowing smarter decisions about which suppliers to do business with.
While rapid technological developments create new opportunities for optimisation, efficiency, and better decision-making, they also bring new risks. As today’s complex supply chains are increasingly vulnerable to cyber threats, businesses must implement and prioritise robust cybersecurity measures to safeguard their supply chains. This requires a multi-level strategy that includes full supply chain visibility, risk monitoring, strong supplier relationships, and data analytics.
Sumit Vakil is the Chief Product Officer and co-founder of Resilinc. As CPO, Sumit is responsible for Resilinc’s product and technology vision, direction, and delivery. Sumit has 25 years of experience bringing innovative technologies to market and has served in leadership roles in Product Management and Engineering at successful startups as well as at Fortune 500 companies such as Brocade and Cisco.