Smart supply chains represent the future of global business

By Georgia Wilson
Anthony Dickinson, Chief Revenue Officer – 2MC (TUV Rheinland Company), the future of global business with smart supply chains...

Across the globe enterprises are beginning to adopt ‘smart’, digitised, supply chains. Smart supply chains can be defined by a range of different processes from utilising the Internet of Things (IoT), robotics, large scale data management, and comprehensive AI mechanisms in order to predict and automate large parts of the manufacturing process. In fact, it has long since been predicted that supply chains that are able to predict and adapt in times of uncertainty are set to revolutionise trade.

One of the foundational principles of smart supply chains is a transition from traditional physical spaces such as the warehouse, to a virtualized, omnipresent set of practices in the cloud. By moving towards digital methods, the smart supply chain promises to offer increasing versatility, precision and return on investment. However, despite the many benefits that they offer, the smart supply chain is not without fault. Smart supply chains consist of multiple moving parts, relying on precision, and constantly fluctuating variables. This means that even the smallest of disruptions can result in detrimental financial and operational consequences, not to mention substantial loss of customer trust which can damage business reputation for years. It is the very precision of operation and their dynamic nature that renders them vulnerable to even the slightest disruption meaning that small delays can be catastrophic.

The heavy investment that is going into smart methods of distribution represents the future of global business. In fact, the typical supply chain in 2018 accessed 50 times more data than just five years earlier, proving that the evolution of smart supply chains will be dramatic and data centric. However, while many are sure that the benefits of smart supply chains will result in improved efficiency and lower costs, one thing that is still unknown is how vulnerable they will be to a variety of currently unknown attack vectors. This is a critical oversight that may affect unprepared enterprises in the coming years. 

As smart supply chains become increasingly ubiquitous and critical to business operations, they will most likely be targeted more by cybercriminals. This means that security decision-makers will soon be expected to secure all of the possible digital attack vectors, many of which have not yet been fathomed. 

The future of smart supply chains will be heavily reliant on how prepared companies are, and if they are able to adequately protect their operational systems. Enterprises looking to deploy smart supply chains in an attempt to increase efficiency should be wary of the many threats going forward and ensure that they are prepared for any eventuality. 

Increasing Complexity, and Unforeseen Challenges

Despite their eponymously smart nature, smart supply chains still possess physical capacities that render them potentially vulnerable to a range of physical disruption. Perhaps one of the most intimidating aspects of smart supply chains is the lack of visibility that they afford. The primary challenge, once a business decides to deploy a digital supply chain, is that data across the distribution lines is not processed entirely by a single entity. Initially many businesses might look to outsource their digital processes which means that their business-critical operations are being handled by third-party corporations. This can be particularly problematic when considering the threat of a data breach, and the complexities of various regulations across geopolitical borders.  

Because smart technology is much more reliant on connectivity than traditional supply chains, they are substantially more vulnerable to cyberthreat. This means that security decision-makers have more attack surfaces to consider, and secure. As many risks that may affect the smart supply chain are often difficult to quantify, these vulnerabilities have a tendency to be underestimated. This creates a shroud of uncertainty for the future of smart supply chains, especially as new technologies such as warehouse robots and AI systems begin to bring new and unfamiliar vulnerabilities to defence teams globally. 

No Easy Solution but Resilience will be Essential

The rising reliance on smart supply chains will most likely lead to a greater number of ransomware attacks. Criminals are drawn towards weaknesses and vulnerabilities, and the uncertainty of smart supply chain infrastructure will most likely result in elevated threat levels. For example, one might expect to see a spike in ransomware activity targeting smart supply chains in the near future, especially amid the uncertainty of post-Brexit supply chains. Indeed, companies should look to ensure that there is no margin of error or uncertainty when mapping out supply chains by delineating a detailed understanding of timings, dependencies, and costs beyond Brexit decision-making. Failing to show resilience in the face of change may present opportunities for cybercriminals to capitalise on supply chain uncertainties.    

In the near future, companies looking to invest in developing smart supply chains should assume that attempted attacks and disruptions are inevitable. Until systems are tried and tested, corporations should have comprehensive contingency plans in place. Companies must develop resilience into operations from the ground up, demonstrating a willingness to revert to manual operations in a crisis, and an ability to isolate critical systems when need be. However, this may prove to be especially difficult when operations are outsourced due to a lack of visibility. The best solution is resilience and resolve, making sure that any potential security gaps are perpetually closed and inaccessible. Initially this may this may be a matter of experimentation, but regardless it is essential to stay one step ahead of cyber miscreants

Smart Solutions to Clever Cybercriminals

As smart logistics evolve, they will require a new generation of equally smart cybersecurity measures to secure it. Currently many defence systems are composed of outdated legacy security systems. However, it is essential that in the not too distant future, we are able to isolate specific networks or systems. This requires new methods and technologies, such as comprehensive AI, that does not currently exist to the scale required. As attackers seek to cause destruction through disruption, it is essential that defenders are able to quickly mitigate this to ensure that smart supply chains remain just that; smart.

Before smart supply chains can be relied on completely, we must develop procedures that are adequate for the modern world and an evolving threat landscape. This is a challenge that will be facing cybersecurity professionals for years to come. If attackers seek to exploit the powers of disruption by targeting smart supply chains, then it becomes the job of cybersecurity teams to quickly understand and mitigate any risk, protecting all aspects of the smart supply chains, and most importantly, the consumer. While this may prove to be a daunting task for companies looking to expand and evolve, it is a necessary one that we must work together to ensure.

For more information on business topics in Asia Pacific, Australia and New Zealand, please take a look at the latest edition of Business Chief APAC.

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