Why Do Business Leaders Need To Understand Supply Chain Cybersecurity?
As a business leader, you understand the importance of protecting your business from cyber threats. After all, cyber criminals target businesses of all sizes and it’s critical to protect your sensitive data.
But, what about your supply chain? Do you have a good understanding of their commitment to cybersecurity? Does it matter?
In this article, we’ll explore the topic of supply chain cybersecurity and explore why it is important for your business.
As a managed IT support provider, Kelser works with companies across a wide range of industries and we understand why the cybersecurity practices of the organizations in your supply chain are as important to your business as those you have in place.
Want to ensure that your organization has every protection? This article will help you learn more about how the cybersecurity practices of your supply chain can impact your business.
What Is Supply Chain Cybersecurity?
As the name implies, supply chain cybersecurity encompasses all of the cybersecurity tools and practices of all of the organizations involved in every process associated with the products or services your business sells.
For many organizations, the supply chain includes manufacturers, vendors, suppliers, retailers, warehouses, transport, and distribution centers, among other entities. Each participating entity has an important role to play in keeping your business information and customer data safe from risks.
The success of your business lies, in part, in your ability to identify, assess, and manage both technical and human security risks in your supply chain.
Why Is Supply Chain Cybersecurity Important?
Every link in your supply chain presents a potential cybersecurity risk and the impact on your business can be catastrophic. Here are some of the critical reasons supply chain cybersecurity is important:
1. Data Safety
The most critical reason for understanding and ensuring supply chain cybersecurity is to protect your data and that of your customers. Everyone works hard to keep data safe and all it takes is one weak link to cause a breakdown in security.
2. Contractual Obligations
In addition to protecting your sensitive business and customer information, you may have contractual requirements that require you to meet certain cybersecurity protocols.
If these frameworks aren’t followed, your business could be held in breach of contract and could be subject to fines and a potential loss of business.
3. Regulatory Requirements
In addition to contractual obligations, your business also may be responsible for upholding certain levels of cybersecurity readiness outlined in regulatory documents. These requirements pertain to your suppliers and vendors as well.
What Are The Potential Risks Of Supply Chain Cybersecurity Failures?
Whether or not you are contractually obligated or subject to regulatory requirements, there are numerous risks if your supply chain doesn’t have appropriate security tools and policies in place.
1. Data Breach Or Other Cyber Attack
The most obvious risk of lapses in supply chain cybersecurity is the very real likelihood that your sensitive business and customer information could be stolen. Whether it’s the recipe for your secret sauce or the personal information of your customers, the damage will be far-reaching.
Related article: What Is Ransomware? How Does It Work? How To Avoid It
2. Financial Losses
Among the most costly damage resulting from a failure in supply chain cybersecurity will be the financial repercussions to your business. In addition to losing contracts, some of the costs you may need to cover include notification and credit monitoring charges as well as legal and forensic investigation fees.
3. Damage To Business Reputation
Damage to your business brand may be among the most costly results of poor supply chain cybersecurity. If a breach occurs in your supply chain, customers will look to the biggest fish they can find to blame and to recoup their losses. \
For many businesses, this damage is insurmountable as the U.S.-based National Cyber Security Alliance reports that 60 percent of small businesses go out of business within six months of a cyber attack.
Who Is Responsible For Supply Chain Cybersecurity?
Supply chain cybersecurity should be a responsibility shared by both entities, but ultimately it is your responsibility as a business leader to ensure that all of the links in your supply chain are hardened to people with bad intentions.
You need to work with your vendors and suppliers to identify areas of vulnerability, assess the real risks of those vulnerabilities being exploited, and develop plans to limit the potential impact.
Related article: 7 Characteristics Of A Successful Cybersecurity Policy
How Can You Help Strengthen The Cybersecurity Of Your Supply Chain?
You can be a valuable asset for your supply chain. Share best practices that you have implemented to enhance the security of your own organization. Help your partners identify risks in their organizations and work with them to develop potential mitigation strategies.
Maybe there are advantages to simplifying your supply chain, so there aren’t so many organizations involved. When possible, building fewer, closer partnerships can lead to a variety of efficiencies.
What’s The Bottom Line?
After reading this article, you understand how the cybersecurity practices of your supply chain can affect your business. You’ve learned what supply chain cybersecurity is and why it’s important (data safety, contractual obligations, and regulatory requirements).
You also know the potential risks associated with gaps in the cybersecurity commitment of your supply chain (data breach or other cyber attack, financial losses, reputational damage). You know who is ultimately responsible for the effectiveness of the cybersecurity of your supply chain and how you can help.
At this point, you may have ideas of best practices you can share with your partners. One of the easiest and cost-effective ways to enhance cybersecurity is by implementing employee security awareness training. Read this article to learn what employee security awareness training is, so you can decide whether it could benefit your organization.
Wondering if you have the tools you need to protect your business and data from the latest cyber threats? Click the button below for a free eBook that will explain 10 actions you can take right now to protect your organization, including:
✔️Updating applications and operating systems
✔️Maintaining current backups
✔️Implementing multi-factor authentication (MFA)
✔️Password protecting mobile devices