Digitalizing the supply chain Part 3: Security

In part one and two of this blog series, we covered the importance of properly planning and strategizing supply chain digitalization, as well as how to best go about the implementation process. However, once new technologies, tools or systems are incorporated into the business model, there is still a lot for supply chain managers to do. 

When it comes to digitalizing the supply chain, one of the biggest issues most organizations encounter is ensuring its security. Cybersecurity has become a global concern - and with good reason. Hacker capabilities are rapidly accelerating in both maturity and sophistication. Nearly all digital devices - and just about any connected tool - can be compromised. Therefore, while the Internet of Things and a digital supply chain provide companies with a wide range of benefits, they also present a growing number of disruptions, particularly if they are not maintained properly.

Everyone's at risk
Making sure in-depth policies and procedures are in place while implementing supply chain technology is of utmost importance. And while this may seem obvious, even many big-name, global companies fall victim to the mistake. For example, earlier this year, after a power outage, Delta Air Lines' backup system failed to work and it faced massive production delays and was forced to cancel thousands of flights.

However, sometimes a digital disruption is inevitable or unavoidable. Recently, Yahoo confirmed it suffered data breach last year in which hackers were able to penetrate its system and obtain private information from over 300 million user accounts. In this ever-evolving threat landscape, companies can't afford not to be careful. 

Knowing what to protect - and how
Protecting the digital supply chain is particularly important when it comes to data sharing and information. Integration tools are needed to enhance collaboration, gather insight to enhance both internal and external operations, ensure compliance and improve communication. However, all these benefits of heightened connectivity that organizations can use to gain a competitive advantage can also backfire and become a source of major disruption for the company.  

Supply chains already face a massive amount of threats - from cargo theft to natural disasters - so they can't afford to leave their digital tools and technologies unsecured or unprotected. Information Age recently explained that, as supply chains across the globe (and in virtually every sector) grow more complex, they increasingly need IT products capable of handling the expanding operations. However, vulnerabilities with these products can very quickly and easily become a vector of attack, whether an intentional or accidental one.

Product quality and third-party risks
Being able to verify the quality and integrity of products is important, not just from an ethical, social or environmentally responsible standpoint, but from a security one as well. This is why many are starting to place a stronger emphasis on purchasing from trusted and reliable providers and partners. As the source explained, not only is it crucial for companies to ensure that proper development procedures were followed in the creation of the pieces and materials, but that the vendors also adhered to best practices with supply chain security - adding that hackers are aware that organizations are only as stable and secure as the weakest link in their networks. 

Businesses are facing continued pressure to increase supply chain visibility, traceability and transparency. It is becoming increasingly difficult to do this as globalization continues to gain widespread adoption. Being able to see into distant tiers of the supply chain is crucial. However, maintaining and ensuring compliance and end-to-end supply chain security isn't just important for internal operations. Businesses must also do this for their suppliers. Unsecured practices used by third-party partners can compromise the safety and security of operations. Considering this, when digitalizing the supply chain, one of the most important steps company leaders must take is ensuring the credibility and quality of the providers they partner with. 

Monitoring digital devices
Incorporating an increasing number of technology tools and digital devices into the supply chain puts it at a greater risk. Many companies realize their computer networks are a security vulnerability, but not as many consider that every other type of connected electronic - from RFID tags and sensors to smart thermostats - can be compromised. 

A new platform, system or software is only as valuable as it is secure. Therefore, one of the most critical aspects of effective supply chain digitalization is ensuring ongoing security monitoring and detection practices. And while it is imperative to take every preventative measure possible, it also helps if managers develop and implement clear, written policies and procedures for risk mitigation, incident response plans and disaster recovery. Doing this not only helps reduce the chance of a breach, but also minimizes the amount of damage, financial loss and production delays that may result if an attack does place. 

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