supply chain warehouse with shelves of boxes

Understanding Cyber Supply Chain Risk Management


This is a guest post from Reciprocity – a Governance, Risk, and Compliance (GRC) Software firm.


Supply chain attacks have increased, keeping cybersecurity experts on their toes due to their adverse effects on organizations. For instance, an attack on a single source is capable of corrupting the entire suppliers’ network. In a recent supply chain attacks report by ENISA (European Union Agency for Cybersecurity), around 66% of the attacks target the supplier’s code. And malware accounts for 62% of the total attacks.

These attacks escalated in 2020, and the trend is unbending even in 2021. In fact, it’s projected that in 2021, the supply chain attacks will exceed the previous year’s attacks by four times. Based on the current situation, applying strong security protection measures only isn’t enough to safeguard organizations. That’s because cybercriminals have resolved to target the source. So, there is a need to implement advanced protective techniques that also involve the suppliers to secure organizations.

In this blog post, we’ve explained supply chain risk management and how to keep these attacks at bay.

supply chain warehouse with shelves of boxes
Photo by Jacques Dillies on Unsplash

What’s Supply Chain Management?

SCM (Supply chain management) is a process organizations use to oversee the flow of goods from production until they reach the end-user. It entails planning and running activities to improve customer value and help enterprises to attain a competitive edge. Supply chain activities include product development, production, sourcing, logistics, and information systems for coordinating all the activities.

The 3rd parties that make up your company’s supply chain improve your company’s operations, innovate swiftly and reduce business operational costs. These involve your manufacturers, cloud hosting providers, service providers, vendors, and any other parties that participate in the building, selling, or distribution of your products. They’re the stakeholders that ease business management.

Unfortunately, supply chain management systems are prone to attack by cybercriminals exposing organizations to risk. Supply chain attacks are rampant in all industries, including government, oil, financial, and more. So, supply chain risk management is inevitable.

Explaining Supply Chain Risk Management

Supply chain risk management or SCRM involves applying specific measures to identify, evaluate and control an organization’s supply chain risks. Efficient supply chain risk management techniques improve organization operations, customer service and help cut costs.

In supply chain attacks, the cybercriminals compromise the manufacturing process, thereby sabotaging all activities within the organization. Some of the aftermaths of cyber-attacks include tampering with personal customers’ details, interrupting the production process, and destroying an organization’s reputation.

This creates the need for excellent supply chain management systems to mitigate the risk involved by applying efficient supply chain risk management strategies. C-SCRM strives to protect your organization from cybercriminals and determines how far and complicated your organization’s supply chain is. It then compares your risk appetite with your supply chain complexity.

Prevalent Supply Chain Businesses Risks

Supply chain companies are prone to cyber-attacks such as data leaks, malware attacks, and supply chain breaches. The 2021 State of the Software supply chain report observed that supply chains are braving serious attacks from cybercriminals whose primary goal is to interfere with open-source schemes to corrupt the business software supply chain. For example, from 2019, July to 2020, May, the attacks recorded were 929 but in a span of only one year, these attacks exceeded 12,000, equivalent to 650%.

1. Malware Attacks

Malware attacks are the most prevalent types of attacks accounting for 62% of all attacks, as pointed out earlier. Malware attacks happen when malicious software accesses a victim’s system without authorization. The virus/malicious software could be ransomware, command, spyware, and so on.

Ransomware normally locks the computer and demands that a certain amount of money be paid as ransom to unlock the system. These viruses are capable of corrupting the entire system and bring all organizational operations to a halt.  

2. Data Leaks And Data Breaches

A data leak happens when sensitive data is exposed unintentionally, either on the internet or even physically. This creates room for cybercriminals to access sensitive data without authorization.

A data breach occurs when attackers are successful in their effort to access sensitive information. So, a data breach and data leak differ despite being used interchangeably because data leak results from poor handling of sensitive data; a cyber-attack is not involved in this case.

But once a cybercriminal detects leaked data, they use it to plan a successful cyber-attack. But you can prevent a looming cyber-attack if you identify and amend data leaks before they get to the cybercriminals.

3. Supply Chain Risk Management Best Practices

Your organization can incorporate best practices in your supply chain risk management strategy. These are practices that can help you locate and avert potential attacks. Also, these practices will guide you on what to do in case of a data breach/malware attack. Here is what to do.

Secure Privileged Access Management

In most cases, after cyber attackers gain access to your system, they’ll go through your entire network searching for privileged accounts – these are the accounts that access sensitive data. Once they find a privileged account, they attempt to breach sensitive data.

This is a predictable attack scheme referred to as the Privileged Pathway. Most cybercriminals use it, including those who breached various U.S federal agencies, including the U.S treasury.

If you can prevent attackers from progressing along this privileged pathway, you can avoid supply chain attacks. That will require an efficient Privileged Access Management (PAM) structure to interrupt a common attack pathway and reduce a potential supply chain attack. However, PAM needs internal and external protection.

A). PAM External Defenses

External defenses are put in place to prevent threats from accessing a network. This can be done through three detection practices.

1. Identify Vendor Data Leaks

Data leaks are accidental exposure of sensitive information. If your organization has not implemented strategies for detecting and preventing data leaks before they get to the cybercriminals, supply chain attacks can happen.

To prevent supply chain attacks that result from data leaks, consider implementing third-party data leak recognition strategies. This way, it will be easy to identify and amend data leaks before they translate into supply chain attacks.

2. Staff Training

Your staff could serve as the gateway for cybercriminals into your ecosystem unintentionally. This happens when the attackers send phishing attacks or scam emails. These emails seem to come from trustworthy sources, but malicious codes get activated upon opening them, leading to the loss of sensitive data.

The information gathered could give attackers access to your network and give them room to search for privileged accounts. But such scenarios can be prevented by educating staff concerning cyberattack strategies that help detect and report a looming data breach. Some common supply chain attacks include ransomware attacks, DDoS attacks, Phishing attacks, clickjacking attacks, and more.

3. Use Honeytokens

Honeytokens function like tripwires. They send you an alert in case they detect any suspicious activity taking place within your network. Simply put, they pose as sensitive data, although they are fake. Since they appear like valuable assets, attackers attempt to corrupt them, and immediately that happens, the signal will get activated and alert you about an imminent attack.

In this case, your organization will be notified of potential data breach attacks concurrently exposing the details of each data breaching attempt. If well equipped, your organization can set apart the targeted resources and develop effective strategies to stop the cyber-attack. For this strategy to effectively avert supply chain attacks in your organization, engage vendors to implement honeytoken.

B). PAM Internal Defenses

Sometimes data breach attempts could be successful, but you can still prevent it from affecting your supply chain by implementing internal PAM defenses. These fall into two categories which include the following.

1. Encrypting Internal Data

You are supposed to encrypt all your internal information with the AES (Advanced Encryption Standard) algorithm. This technique prevents cybercriminals from accessing data needed to initiate supply chain attacks.

2. Implement (IAM) Identity Access Management

IAM techniques make it possible to manage several Access Privileged Accounts from one interface. This makes it possible to account for all privileged accesses.

Key Takeaway

C-SCRM is a process for safeguarding your supply chain integrity by detecting, evaluating, and preventing attacks that target the source to corrupt the entire business network. You can take advantage of the best C-SCRM practices to stay ahead of the attackers. For effective results, seek help from professionals. 


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