Supply chain security management and Cyber risk management are top priorities for many businesses as cybercriminals look to exploit weak supply chain cybersecurity. Many business leaders rely on cybersecurity to protect their networks, software, and assets against cyber-attacks and any data breaches. Oftentimes, however, they neglect supply chain cybersecurity; whether a conventional manufacturer or contemporary service provider’s supply chain, these third parties present serious vulnerabilities.
Finding and fixing cybersecurity threats in supply chain security should be ingrained in every part of the business. All third-party suppliers from the front office to the far reaches of your supply chain should be integrated and implemented with a cyber risk management plan for boosting your supply chain security, and reducing risk for the whole business as well.
Why? Data breaches caused by third parties increase the cost of a data breach by an average of $207,411 according to the Ponemon Institute’s latest Cost of a Data Breach report. That’s why a cyber risk management plan is critical for organizations that rely on digital third parties. In this article, we explore how you can secure your supply chain with a solid cyber risk management plan?
Cyber Supply Chain Security Management Plan and Its Significance in 2022
As more companies are managing their operations to external supply networks that operate over the globe, the significance of cyber supply chain security management is unprecedented. With an evolving network of prospects and increased global dependencies, there is a huge risk that if you lag in one function, you could risk losing your business targets.
A good cyber risk management plan ensures the solidarity of your supply chain by identifying, assessing, and mitigating the cyber risks associated with your product and service supply chains. It can also centralize the workflows, make the organization much more efficient, and safeguard you from cyber threats lurking undetected.
Why is a Cyber Supply Chain Risk Management Plan Critical?
With so many points of connection in your supply chain network, cybersecurity is essential to create trust, visibility, and ensure consistent, on-time movement of goods and assets. Here are 6 reasons to enact a cyber supply chain risk management plan:
- It provides clear visibility on your critical suppliers and helps to manage them. It also supports collaborating with your key suppliers and incorporating them into your supplier risk management program.
- Mitigates cyber risks and prevents the potential losses that could occur due to the vulnerabilities present in your supply chain.
- Contributes to increasing the trust among supply chain partners and amplifies the supply chain partner relationship. It further improves the process of identifying, communicating, and mitigating cyber threats.
- Addresses the cyber risk exposure beyond the company’s facilities, into the much broader domain of geographies and capabilities.
- Delivers insight to the organization on crucial areas of concern by pinpointing potential risks and implementing solutions to improve the supply chain.
- Provides useful technology that enables live updates to boost customer satisfaction and meet both regulations and safety standards.
What does a Supply Chain Cyber Risk Management plan include?
Global supply chains are more vulnerable than local chains and need a comprehensive examination, since companies may incorporate many levels of subcontractors. Each contractor or function brings a new level of risk to the table. This could lead the organization to a higher risk which can be very hard to trace and lead to costly product or service recalls. Let’s see what you should include in a solid supply chain risk management plan.
Determining Supplier Cybersecurity Requirements
While determining the cybersecurity requirements of the supplier, the process must include the following steps.
- Reviewing existing and current system architecture based on the key business processes of the supplier.
- Performing a comprehensive analysis and assessing each of the components of the supply chain that support that key business process.
Implementing formal cybersecurity agreements with suppliers
Before implementing an agreement or contract, it is important to learn about the supplier’s priorities, background, and key business processes. The agreement must follow the guidelines of the NIST Cybersecurity Framework.
Communicating how cybersecurity will be verified and validated
Clear communication should establish among the stakeholders and suppliers how cybersecurity will be verified and validated. This should answer questions such as:
- How will this improve the organization’s productivity and supply chain effectiveness?
- How would a loss affect the confidentiality, integrity, or availability of the organization’s system?
- What are the tools/methods used to verify cybersecurity?
- How will the prescribed tools be validated?
Using assessments to verify cybersecurity requirements are met
A well-developed Cyber Risk Quantification (CRQ) can provide a completely detailed assessment. This method should be information-driven and supplier-centric, so it is scalable across the enterprise. Cyber Risk Quantification helps to quantify the risk related to the supply chain in monetary terms, which could otherwise lead to denial of services, data leakage, customer data theft, reputational risk, and even an entire shut down of the business.
At RedMonocle, we help increase the visibility to supply chain risk readiness to defend against market disruption. Our ‘Always On Audit’ can give you insights into supply chain security by monitoring regulatory compliance throughout your supply chain as well as identifying blind spots. Manage your suppliers, realize the business value, and reduce risk.
Your cyber risk management plan is only as strong as your weakest link. Find your blindspots, secure your supply chain.