The Increasing Significance of Supply Chain Security

CIO Review Europe | Wednesday, September 15, 2021

Supply Chain Security encompasses managing physical and cyber hazards, ranging from terrorism and piracy to non-compliance and data loss.

FREMONT, CA: The day-to-day operations of a supply chain are complex, as items and services must be supplied on time and in the correct manner. If these processes are disrupted, an organisation may face significant financial, reputational, and operational challenges.

Due to the vast surface area of modern supply chains, vulnerabilities might exist at every stage or tier of the supply chain. Managing its security has never been more critical, as a single security breach at a third-party supplier could have disastrous consequences for the other organisations in the supply chain.

Complacency is the primary source of concern for supply chain security. According to the Government's Cyber Breaches Survey 2020, there is widespread uncertainty about how the cybersecurity of the suppliers is directly related to an organisation. Simply put, to compete in today's fast-paced, highly demanding consumer market, suppliers must have access to enterprise systems and data to conduct business. This means that, however, inadvertently, the suppliers' systems are linked to enterprises' own, and any vulnerabilities become the responsibility.

The following section describes the top supply chain cybersecurity risks:

Inadequate visibility into the supplier chain: Without a doubt, if firms don't have a comprehensive image of their supply chain and each supplier's access privileges, they are highly likely to be unaware of a third-party supplier or subcontractor offering significant security threats that could affect the entire supply chain.
Data that has been compromised: If a supplier is handling or retaining sensitive data on firms’ behalf and they suffer a breach, cybercriminals can steal, alter, or destroy this data, jeopardising the business's reputation and perhaps resulting in operational downtime, financial losses, legal action, or regulatory fines.
Software solution providers: Numerous malicious supply chain hacks originate with software solution vendors. Cybercriminals inject malware into software, for example, via an update, which is then widely distributed, allowing the malware to infect any system that uses the software or instals the update.
Security flaws in supplier systems: While companies may have implemented significant security measures within the organisation, they are rendered ineffective if their suppliers have not followed suit. Supplier system vulnerabilities can be exploited at any level, granting hackers access to the assets and systems.
Inadequate supply chain management: A well-managed supply chain instantly contributes to the mitigation of cyber threats. Without communicating security standards to suppliers, there is no way to ensure a minimum-security level is reached, decreasing overall supply chain risk.