T echnology has fundamentally transformed the way businesses transact commerce. Because of the Internet, mobile devices, applications,
and cloud computing, companies and their suppliers
can now share a large amount of data at the click of
a button. Today, information about everything from
order volumes and capacity status to activity-based
management protocols and transportation metrics—
to name just a few possibilities—is electronically
transmitted between business partners.
These information flows and symbiotic connectivity in an organization’s supply chain have become
critical components of reducing costs and developing
integrated profit centers. In fact, today’s global supply
chains rely upon the rapid and robust dissemination
of data among supply chain partners.
But this exchange of information brings with it
a certain degree of risk. The flexibility, scalability,
and efficiency of the technology that enables information sharing has created additional points of
access to an organization’s proprietary information,
increasing the risk that the corporate knowledge that
drives profitability may fall into the wrong hands.
Particularly vulnerable are those processes and activities that involve the sharing of information between
external supply chain partners.
That is why supply chain managers must play a
larger role in cybersecurity—the measures taken to
protect a computer, computer network, or data from
unauthorized access or attack. They need to be aware
of what the risks are and of which areas of their sup-
ply chain may be vulnerable to cyberattacks. And they
must make sure that not only their own company
but also their suppliers are following best practices in
cybersecurity.
A GROWING THREAT
The danger to businesses and their customers from
hacking and cyberattacks has become pervasive.
Indeed, the list of cyberattacks and data breaches
seems to grow by the week. In the United States, such
large companies as Home Depot, Sony, Target, and
the managed health care company Anthem, among
others, have been victims of well-publicized cyberattacks.
The number of U.S. data breaches tracked in 2014
hit a record high of 783, according to a report released
earlier this year by the Identity Theft Resource Center
(ITRC). 1 That represents an increase of 27. 5 percent
over the number of breaches reported in 2013 and
an increase of 18. 3 percent over the previous high of
662 breaches recorded in 2010. Moreover, more than
5,000 data-breach incidents involving more than an
estimated 675 million records have been reported and
tracked in the United States since 2005, according to
ITRC. Cyberattacks are not solely a U.S. phenomenon, however. According to Verizon’s 2015 Data
Breach Investigations Report, there were 2,122 con-
Information has become a critical supply chain asset,
making it increasingly important to protect your data.
That means paying more attention to suppliers’ security practices.
BY DREW SMITH
Is your supply chain
safe from cyberattacks?
