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How to keep your supply chain secure and consta

What Is Supply Chain Security And Why Is It Important?

Successfully creating products and delivering them to consumers requires a robust network of companies and people to work as efficiently as possible. Whether it’s the raw material producers or the drivers of the vehicle fleets that deliver products straight to end users, all companies that exist within these supply chains have vital parts to play.

Optimising the supply chain and creating more cost-effective and efficient production cycles is a constant, ongoing battle for organisations. There are the issues of emerging competition, geopolitical conflicts, rising material costs and soaring inflation, not to mention the increasing digitisation of services. However, the lattermost issue has led to a growing number of cyber attacks on supply chains worldwide, with government data showing that one in 10 businesses is at risk of oversight by their immediate suppliers.  

Attacks can result in devastating consequences for businesses, from loss of revenue and damage to reputation to regulatory fines and long-term instability. Supply chain management has, therefore, required organisations to exercise more diligence and awareness of online security, data protection and risk management.

Monday, March 13, 2023

What is Supply Chain Security?

Supply chain security refers to the supply chain management process that focuses on the risk mitigation of transportation, logistics, vendors and suppliers. The goal of supply chain security is to identify and manage the risks that exist in working with the various different organisations throughout a company’s incumbent supply chain. This doesn’t just refer to the physical security of products or assets, but also online and cyber security relating to software, finances, services, and data transmission. 

For supply chains to work efficiently and securely in moving products or services from suppliers to consumers, all active organisations must exhibit an awareness to maintaining fleet productivity and route reliability in addition to upholding security best practices. Supply chains vary across geographies, groups, and sectors, with many different companies involved in various stages, so establishing clear, one-size-fits-all supply chain security guidelines is impossible. 

Establishing a strategy requires all companies to combine risk management and cyber security and defence procedures, while also familiarising themselves with government legislation and regulations. 

Why is Supply Chain Security Important?

Supply chain security prevents disruptions that lead to loss of business or damage to reputation. The most common supply chain attacks include:

  • Data breaches (which lead to GDPR violations and fines)
  • Financial or identity theft
  • Product or material shipment delays
  • Fraud and money laundering activities
  • Compromised quality assurance protocols
  • Improperly manufactured products
  • Poor oversight of customs and import taxes
  • Loss of stakeholder or consumer trust

Supply chain attacks have grown in prevalence and sophistication in recent years. Notable attacks on manufacturers and producers have demonstrated the potentially devastating effects that a cyber attack can have on a single organisation. Cybercriminals are commonly targeting open-source systems and data in their attacks, and while most cyber attacks are financially motivated, others are driven by moral or socio-political disagreements. 

Physical assets like warehouses, vehicles and devices can be at risk if a threat actor can weave their way into a company’s infrastructure. However, the information that flows throughout that supply chain also needs sufficient protection, which includes identifiable information about consumers and their finances, as well as any intellectual property.

If a cybercriminal is successful in infiltrating a company’s system or infrastructure, then all connected applications may be impacted. All stored data (including that of that business’s employees, suppliers, investors or stakeholders) may be at greater risk of harm, harassment, bribery, or discrimination. Therefore, demonstrating compliance with cyber security regulations and guidelines is crucial.

How to Improve Supply Chain Security

There are numerous things that organisations can do to improve their security and ability to identify threats, thus strengthening their protection of assets, information and people. These include (but are not limited to) the following:

  • Establishing a risk management framework. This will help businesses to identify and assess the risks to their supply chain, as well as ensure compliance with relevant guidelines and laws regarding data protection. Risks can be identified by conducting regular audits, background checks and security strategy assessments, which involve identifying potential threats, assessing the likelihood and impact of those threats, and prioritising the risks. As such, companies can establish a minimum requirement from accredited and certified vendors and suppliers that they work with.

  • Encrypting data and devices. Companies should make regular and effective use of tools, software, databases and files that safeguard all stored information and financial data. Whether the devices that store this data are located in the cloud or are physical and potentially on the move (for example, company mobile phones), it’s vital that organisations ensure sufficient protection of this data. This includes implementing MFA (multi-factor authentication), strong password policies, biometric verification, secure VPN access and regular updates and patching. 

  • Implementing security controls and response plans. Companies must identify all potential loopholes and vulnerabilities in their systems and networks by running vulnerability scans, and ensuring that any endpoints are secured. One of the most effective solutions to find vulnerabilities and also receive detailed guidance is to consult the services of professional, third-party penetration testing providers, or even invest in 24/7 managed network threat detection and solutions. From this, businesses can develop steps to identify, contain and investigate incidents.

  • Training employees. Employees - who are in high demand for many businesses these days - should be trained on sufficient and adequate security procedures and how to identify and report suspicious activity. Training can help to raise awareness of security threats and help employees ‌take steps to protect their organisation and client data, as well as ensure optimum safeguarding of the supply chain. Ensure that only qualified or accredited employees are able to access data and systems at higher permission levels, and ensure these do not fall into the hands of junior staff or third-party contractors, as this could be an anomalous GDPR breach upon detection. 

  • Working with suppliers. Businesses should work closely with their suppliers to ensure that they have adequate security measures in place. This could involve sharing information about security threats and best practices. By exercising transparency as it pertains to breaches and emerging threats, they are taking steps to ensure that all companies that are - or could be - affected are aware and thus, can take steps to mitigate them as much as possible.

By taking these steps, businesses can improve their supply chain security and protect themselves from a variety of threats.

It’s important to remember that supply chain security isn’t ever truly one-and-done. It should be viewed as a constantly-evolving measure, in the same way that a business scales as its needs change. 

By working closely with suppliers, training employees, encrypting data and implementing strict security controls and risk management frameworks, companies can strengthen their security posture and protect their supply chains. 

It may take time to materialise and will require adaptability, but once established, it will give you complete peace of mind and a solid understanding of how you can adapt your strategies going forward. 

Author Bio

Annie Button is a freelance writer based in the UK. She specialises in business development, digital marketing trends, sustainability, hospitality and HR. Annie writes for a variety of prestigious online and print publications.

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