What is Supply Chain Cyber Security: How to Protect From Attacks

Supply chains are networks between an organization and others who provide materials or products eventually destined for a consumer. A supply chain can be complex. Besides physical resources, it can also handle things like digital information, entities, and even people. Depending on the size of a particular organization, they can have entire teams dedicated to overseeing a supply chain. It can be a vital component to the operation of any business.

Why is supply chain security important? If there is no product, there is no business. Disruptions to the supply chain can cripple an organization. Not only do they need to be concerned about their suppliers, but they also need to guard their systems. Supply chain cyber attacks can fracture lines of communication, records of transactions, inventory, and forecasting for the future. Cyber criminals have found supply chains to be a source of valuable information about an organization's current or future plans, as well as being a source for general confidential information not intended for outsiders. If you work with your organization's supply chain, how can you protect yourself? How can you ensure business runs to forecast? We have some tips for staying safe and operational.

Supply Chain Cyber Security

Photo Attribution: Mascha Tace & Evgeny Bornyakov/Shutterstock.com

How Does a Cyber Security Threat or Attack Infiltrate a Supply Chain?

In the blink of an eye, business is put on hold. You cannot bring in new products, your clients cannot buy from you, and you have lost your inventory plan for the year. These are just some of the repercussions of an attack on an organization's supply chain.

To understand supply chain cyber security, you must first know how it can infiltrate a system. These types of attacks do not go for the front door. In other words, they do not try to steal your password to gain entry. Cyber criminals are getting smarter. They know you likely have a strong password, two-factor authentication, and all of the other basic security necessities in place. Instead, they prefer backdoor entry, injecting malicious code or components into one of your trusted pieces of technology (hardware or software). Once in place, cyber criminals can not only cripple your supply chain, but they can also obtain critical information about your suppliers and clients, creating a chain reaction of damage.

Protecting yourself does not stop with monitoring your systems for suspicious activity. It also means staying on top of your suppliers and clients, who may also be accessing your system. Nick Weaver, a researcher at UC Berkeley, claims, "you're trusting every vendor whose code is on your machine, and you're trusting every vendor's vendor."

Finitestate Supply Chain Vendor Cyber Attack

Image courtesy of Finite State

What are some Supply Chains Risks Associated With a Cyber Attack?

Supply chain cyber security threats can come from many directions. These systems often interact with suppliers, manufacturers and even clients, meaning the amount of touch points opens up the room for potential breaches. Three of the most common risks faced by supply chain systems include:

  1. Data Leaks: Whether it be a bad actor from within the organization or an external cyber criminal, data leaks can be harmful for organizations, but beneficial for the perpetrator. It can house an abundance of information about an organization's future plans as well as many key contacts
  2. Security Breach: These usually occur when a cyber criminal gains access to the supply chain system without permission. They may intend to steal and leak data as mentioned above, among other disruptive actions
  3. Malware: Ransomware can infect your supply chain system, locking you out of your data until payment is made. This causes downtime as business grinds to a halt until the situation is corrected

Example of Supply Chain Attack Through the Back Door - SushiSwap

SushiSwap allows users to run a platform where they can buy and sell crypto currency and other assets. According to Kraken, "users first lock up assets into smart contracts, and traders then buy and sell cryptocurrencies from those pools, swapping out one token for another." They are a crypto supply chain in that they house several different currencies (including their own "SUSHI") and facilitate the exchange between end users.

In May 2021, an anonymous contractor with the handle AristoK3 gained access to SushiSwap's project code repository - a back end location of their platform. The user then proceeded to publish malicious code that ultimately traveled to the front end of the platform. Though the attack did not stall operations, it did result in the theft of 864.8 Ethereum coins, which equated to roughly $3 million USD. By the time SushiSwap management caught wind of this, AristoK3 was already trading his stolen profits to other users. There are varying accounts about whether AristoK3 was granted access to work in the back end by management or whether access was gained illegally.

The common theme here is that attacks to the supply chain often occur in the back end, where organizations least expect something to go wrong.

Should you Invest in Supply Chain Risk Management Software?

Risks to supply chains can come in many forms. Beside cyber security, which we have already talked about in detail, organizations will also need to consider natural disasters, terrorist attacks or government dealings, such as Brexit in the U.K.

If the COVID-19 pandemic has taught us anything, it is that things can happen quickly, and preparation is key. Therefore, it should come as no surprise that Koray Köse, a Senior Analyst at Gartner, says that, "90% of organizations plan to put money and time into making their supply chains more resilient over the next two years."

So, what can supply chain risk management software do for your organization? According to Köse, through Supply Chain 247, there are four main areas it can assist with:.

  1. Monitoring: Your employees should be focused on their work. Risk management software can watch their backs. Whether it be through regular reporting or real-time alerts, a cyber security risk management program can notify you of unusual activity. You will just need to be prepared to enact your risk mitigation plan if and when that alert comes through.
  2. Analyze Impact: Need to better understand how downtime affects your entire network? Supply chain risk management software can analyze theoretical situations or actual impact (if an attack has already occurred), in order to determine its scale.
  3. Mitigation: We are not all experts in information technology and data protection. This software can assist in providing recommendations to keep organizations safe when they let their guards down. Simple reminders can also be beneficial when teams get "too busy" to think about cyber security.
  4. Learning: Implement machine learning capabilities to tailor future recommendations and other actions related to your supply chain cyber security.

If you are "on the fence" about investing in supply chain risk management software, the time to implement one is now. Supply chains are the heartbeat of an organization, and treating it with the utmost care is vital. This type of software allows you and your team to remain focused on what matters most, while leaving the monitoring and mitigation of cyber security threats to them.

The Bottom Line: Protect Your Supply Chain from Bad Actors

Supply chains are critical to the function of any organization that employs one. Protecting it through in-house due diligence or via risk management software can prevent downtime and stolen data by identifying any supply chain vulnerability. In today's technologically inclined environment, protecting supply chains goes beyond worrying about natural disasters, terrorist attacks, and government interference. It also means carefully considering cyber security and the threat posed by bad actors on the Internet.