As businesses become increasingly reliant on technology, supply chains are critical when it comes to keeping businesses running smoothly. However, as technology evolves, so do the risks of targeted cyberattacks. Businesses of all sizes are becoming increasingly concerned about the threat of cyberattacks and their potential to cause widespread disruption across supply chains.

Why supply chains are vulnerable

From communication to logistics tracking, supply chains rely heavily on technology. While this is great for increased efficiency and real-time updates, it also creates multiple ‘ins’ for cybercriminals. If one link in the chain is affected by a cyberattack, whether it’s a supplier, distributor, or transporter, the effects of this can quickly ripple outward, affecting other businesses within the chain.

Cybercriminals tend to target smaller companies within these chains, as they often have fewer cybersecurity measures in place. Once they have gained access to their systems, hackers can cause operational delays, steal sensitive data and even bring operations to a complete halt.

The real-world impact of cyberattacks

The effects of a cyberattack on a supplier or logistics firm can often be immediate and widespread. They can result in delayed deliveries, product shortages and communication breakdown between businesses. In sectors like manufacturing, retail, and healthcare, these disruptions can be particularly harmful, leading to financial losses, delays and reputational damage.

The cost of recovering from a cyberattack isn’t just limited to the business that was originally targeted either. Other businesses in the chain are likely to be affected by knock-on costs, whether it’s due to needing to source alternative vendors, managing delays or losing sales.

Building resilience in your supply chain

To protect your business from supply chain cyber risk, it’s important to understand who is in your chain and what cybersecurity practices they implement, including your suppliers, partners, and service providers; a chain is only as strong as its weakest link.

Some key steps you can take include:

• Carrying out regular security audits across your supply chain
• Ensuring third parties meet agreed cybersecurity standards
• Creating contingency plans to manage supply disruption
• Keeping communication channels open so issues are identified and managed quickly

How cyber insurance can help

It’s also important for businesses to consider cyber insurance as part of their risk management strategy. These policies have been designed to offer vital support in the event of an attack, helping to cover the costs of recovery, business interruption, and even reputational management.

Staying ahead of the threat

As cyber threats continue to evolve, businesses should ensure to remain aware of the resilience of their supply chain and consider what steps you can take to protect yourself if something does affect a link in your chain. Taking proactive steps to improve cybersecurity, both internally and across your network, can help your business stay ahead of the risks.

Sources

[1] Latest BCI report reveals escalating supply chain disruptions drive increased tier mapping and insurance uptake | BCI.org

[2] Using passwords to protect your data | NCSC.gov.uk

[3] Latest BCI report reveals escalating supply chain disruptions drive increased tier mapping and insurance uptake | BCI.org