How to Mitigate Supply Chain Cyberattacks


Liberty Advisor Group

Supply chain cyberattacks are increasing. In fact, the growing digital and connected global economy makes it even easier than ever for malicious people to carry out attacks exploiting the trust partners and businesses have for one another.

In December 2020, network software developer SolarWinds suffered its biggest security breach. The SolarWinds “Orion” attack was so explosive that it compromised global companies’ key supply chains and cost cyber insurance companies upwards of $90 million. SolarWinds also had to shell out upwards of $3.5 million to handle the problem.

According to a 2021 survey, 45% of participants had suffered a supply chain cyberattack within the last year, up from 32% in 2018. Supply chain software attacks had a 650% yearly increase from 2020 to 2021, following a 430% rise from 2019 to 2020. These figures highlight the fact that supply chain security breaches are likely to remain an ongoing threat to all businesses in various industries for the predictable future.

Therefore, businesses must understand the risks associated with supply chain cyberattacks and how to implement defenses to mitigate the threats.

The Major Threat

In the supply chain world, where people expect their demands to be satisfied with faster delivery and shipping, the supply chain industry can only be driven by evolving digital technologies, which have often worked well in the background, and supply and demand continued to flow seamlessly.

However, the same digital technologies that make operations in the supply chain faster and more effective also cause threats to their security. Supply chain security is a major threat to businesses, often overlooked, forgotten, and underestimated. In contrast, cybersecurity in supply and demand should be highly prioritized for companies as a system breach can disrupt or damage operations.

According to a recent survey by The Economist, more than one-third (36%) of executives reported that cyberattacks greatly disrupted their supply chain operations in the last three years. Cyberattacks were recorded second after the global pandemic as the force causing problems with the global supply chains in 2020.

Key Security Risks of the Supply Chain

The challenge is that when supply chains think about security, they often think of securing company networks, digital assets, and software against cyberattacks and security breaches. However, the supply chain is also most vulnerable to key security risks, including:

    • Vendors or third-party service providers, from software engineering to janitorial services, with virtual or physical access to software code, information systems, or Intellectual Property (IP)
    • Low-quality information security strategies by lower-tier suppliers
    • Compromised hardware or software from suppliers
    • Vulnerabilities in software security within supplier systems or supply chain management
    • Hardware with embedded malware or counterfeit hardware
    • Data aggregators or third-party data storage

Companies must understand that the number of cyberattacks and data breaches is directly proportional to the supply chain automation level. Specifically, a lack of proper automation implementation increases the vulnerability of a supply chain. Thus, leading to inefficient delivery schedules, unnecessary costs, and intellectual property loss. So economic ramifications of security breaches will increase exponentially the more automated and complicated the supply chain is.

Ways to Mitigate Supply Chain Cyberattacks

Supply chain breaches are increasingly becoming a critical business issue impacting supplier-partner relationships. But while they are hard to detect, you can take steps to prevent supply chain cyberattacks:

1. Conduct a Risk Assessment

Before taking any steps to improve supply chain security, it’s crucial to assess possible risks and identify where they lie. The most common causes of breaches in the supply chain include application vulnerabilities, stolen or weak credentials, insider threats, excessive permissions, malware, and user error. Conduct an intensive and comprehensive assessment of your supply chain partners and assess their level of security. Additionally, you need to know what data is being shared with which party. This ensures maximum security and minimizes data exposure by controlling sharing of unnecessary data. Minimize permissions and access to cloud servers where critical information is stored.

2. Collaborate with Suppliers to Improve Security

Engaging with suppliers is a sure way to maintain a secure supply chain. Organizations should maintain regular communication with third parties to mitigate supply chain vulnerabilities. You can plan meetings and visits to review policies to enhance supply chain security and resilience. You can also conduct regular training to raise awareness among suppliers.

It’s crucial to propagate your security standards and needs to your suppliers. Find a way to ensure they align with your entire supply chain. You can define your security policies and requirements by incorporating them in supplier contracts or service-level agreements. This helps you standardize and communicate to your suppliers and make them accountable for breaches and security incidents they cause.

3. Limit Vendors’ Access to Vital Assets

Third-party vendor access and misuse are threats to supply chain security. So to protect your critical systems and data from malicious actors, limit the privileged access of your suppliers to only what they need to perform regular tasks. Consider employing a zero-trust model that assumes no application or user is trustworthy by default. This limits access to critical assets and the types of activities possible within a company network. To further minimize the risk of malicious activities, you can adopt the network segmentation approach, dividing your networks into self-contained subnetworks to protect your sensitive assets or data, even if there’s a compromised subnetwork.

4. Conduct Vulnerability Testing

Running vulnerability scans on your supply chain can help you identify security concerns like poor database configurations or weak password choices and mitigate risks associated with various fragments. Regular vulnerability tests can also help you uncover software and hardware bugs. For example, the Supermicro bug wasn’t uncovered until Amazon ran a motherboard test.

5. Encrypt Supply Chain Data

All critical and protected information should be encrypted and stored in secure files regularly updated with new encryptions to keep up with the latest technologies.

6. Establish an Incident Response Plan

Due to the unforeseeable nature of risks in the supply chain, it’s critical to develop defenses in anticipation of any incidents that may compromise your systems. So even if a security breach occurs, you will be proactively prepared with a robust incident response protocol. This plan should include roles, procedures, and conditions for incident response and a communication strategy for making customers and partners aware of the breach.

In Conclusion: Every Supply Chain Touchpoint Creates a Vulnerability

While digitization and automation of processes have several benefits, they only increase the frontier for supply chain cyberattacks.

All technology-enabled business capacities and processes are susceptible to security attacks. The supply chain sector stands out as the most vulnerable in terms of the number of touchpoints. Every link in the chain, from the raw materials to the service and finished product, and everything in between, including labor, is a new security risk. Every touchpoint along the end-to-end, extended supply chain is a possible gap for attacks.

Therefore, supply chain security needs a multifaceted approach. Enterprises need to protect their supply chain by combining a number of layered defenses. Reach out to us for your cybersecurity needs.

About Liberty Advisor Group

Liberty Advisor Group is a goal-oriented, client-focused, and results-driven consulting firm. We are a lean, handpicked team of strategists, technologists, and entrepreneurs – battle-tested experts with a steadfast, start-up attitude. We collaborate, integrate, and ideate in real-time with our clients to deliver situation-specific solutions that work. Liberty Advisor Group has the experience to realize our clients’ highest ambitions. Learn more at and on LinkedIn and Twitter.


Liberty Advisor Group

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