Supply Chain Security: Definition, Importance, and Examples

Hackers and cyber attackers don’t take their day off, neither should your Supply Chain Security. In this tech-centric world, businesses are more interconnected and so is their fragility. Is your business ready to fight these threats?

To protect your business, you must know about supply chain malware and back doors. In this blog, you can learn about Supply Chain Security with examples. Let's break down how you can fortify your business and stay ahead of the rising threats.

Table of Contents

1) What is Supply Chain Security?

2) Why is Supply Chain Security Important?

3) Supply Chain Security Threats

4) Supply Chain Security Best Practices

5) Supply Chain Security Examples

6) Conclusion

What is Supply Chain Security?

Supply Chain Security is a process to mitigate supply chain insecurities in your business. It tends to improve security management systems by handling physical threats and data protection. This process aims to defend the entire supply chain, including suppliers, manufacturers, IT, logistics and third-party suppliers.

Supply Chain Security promises to reduce internal and external risks like fraud, piracy and data theft. This security practice protects your business from:

1) Ransomware attacks can lead to major supply chain disruptions

2) Hackers attack software systems, introducing malware into critical software

3) Third-party data breaches spill confidential information

4) Huge monetary loss due to physical or in-transit theft

5) Customer relationships and product integrity get sabotaged

6) Cybercriminals attempt to attack libraries which contain backdoors

Why is Supply Chain Security Important?

Supply Chain Security helps you stay ahead of the game and protect your business from cyber breaches. These attacks lead to a business scramble and impose nightmare on the entire operation. It plays a crucial role to save your business from varying attacks, such as:

1) Loss of stakeholder trust

2) Data breach that leads to GDPR violations

3) Delays in project constructing

4) Poor good manufacturing

5) Delay in delivering raw materials

6) Cyber theft, fraud and data loss

Supply Chain Security Threats

In this globalised age, supply chain attacks exploit business trust, stakeholder relationships and third-party software. Let’s discuss some main supply chain threats:

Untrusted Partners

Some businesses allow third party bodies to have access to their confidential data and networks. Attackers use these partners or vendors, abuse business trust relationships and earn access to the business environment.

For example: In the retail industry, they rely on third parties to deliver products to customers for Just in Time (JIT) delivery.

Insecure Code

In Third party dependencies, developers lack visibility in their vital codes for their applications. Sometimes, these third-party libraries contain exposures which are used by the attackers to harm the customer base.

Hidden Backdoors

Cybercriminals implement backdoors that compromises libraries to impose malicious act. These steps end up with deficiencies or backdoors for the attackers to gain access to corporate systems.

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Supply Chain Security Best Practices

Protecting your supply chain and business from cyber threats is challenging but not impossible. It requires a strong security strategy and risk management techniques.

Here are some best practices that you can follow to defend your business:

Data identification and encryption

According to the views of The National Institute of Standards and Technology (NIST), it can be assumed that data breaches are inescapable. Therefore, companies must establish security on every data they store. You can use a data discovery tool to identify and categorise files with sensitive financial information and customer data.

Today, businesses are more relying on online transactions and platforms. Thus, you must take controls on digital signatures, session breaks and authentication process.

Managing Third-Party Risk

Companies within the supply chain are collaborating with third parties for transmit, use and store their data. This collaborative technique imposes cyber risks and trust issues. To manage these complexities, you can improve transparency, visibility and end-to-end management.

Companies can have a third-part risk assessment with the stakeholders. Business partners and technical teams can work together to protect business assets. Companies can work on inadequate monitoring and data security in third-party operations.

Managing Internal Network

Smooth internal supply chain is essential for building a successful pipeline with the customers. You cannot use external suppliers to produce products without any raw materials. Whereas, with internal suppliers you can do so if the final product is ready to launch.

Detailed planning can help in shaping the internal network and promote your finished product. It also helps you finish your product deadline and an in-depth plan to address the issues. It can satisfy the needs of the employees as well as the potential customers. Likewise, it can be achieved with securing internal network and visibility management.

Establishing Controls & Visibility

A company’s network ensures secure data exchange between partners while covering various enterprises. To share sensitive data, finances and proprietary information securely, Identify and Access management (IAM) practices are preferrable.

You can reduce the risk of data compromise and unauthorised access by building a business ecosystem. Continuously monitor database activities and user access to improve control and visibility. These can help in identifying the issue to resolve them as soon as possible.

Securing Supply Chain Digitally

Digitalisation is the future for every field; thus, abandoning traditional Supply Chain Security can be an option. Replacing telephone, fax by new digital techniques can be a safer option. Modern environment allows you to secure data transfers with third-party bodies, suppliers and customers.

You must keep the supply chain and software up to date to ensure data security. This can be done with monitoring file access, tokenisation, up to data encryption and data loss alerting. Digital transformation can help in preventing cybersecurity risks, fraud and maintain awareness.

Orchestrating Incident Response Planning

Companies should focus on preparing an action plan in case data breach happens. A practical, easy-to implement action plan can help reducing monetary loss. This can save your business from reputational damage, losing client base and stake holder’s trust.

The well-planned action plan can help to make decisions for internal and external partners. This can be helpful in making informed decisions to prevent repetition of attacks and incidents.

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Supply Chain Security Examples

The construction and manufacturing sectors are more vulnerable to third-party data breach risks. Some of the examples include:

1) Prequalified contractors and suppliers

2) Information security

3) Risk assessments and management

4) Fraudulent and financial breach protection

5) Trust issues of supplying the raw materials

Conclusion

Supply Chain Security is constantly evolving to mitigate business risks and build trust and understanding. In today’s era of increasing cyber-attacks, this security is no longer optional-it's essential. It is necessary to strengthen supply chain management to maximise business efficiency and return on investment (ROI). The key is to continuously monitor the supply chain and build a foolproof action plan.

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