Understanding Cyber Risk in the Manufacturing Sector in Wales
In today's interconnected world, where digital technology plays a crucial role in every industry, the manufacturing sector in Wales is not immune to cyber risks. As manufacturing processes become increasingly automated and data-driven, organisations face unique challenges when it comes to safeguarding their operations against cyber threats. Learn more about the landscape of cyber risk in the manufacturing sector in Wales and how it can be mitigated.
IBM Security’s 2023 X-Force Threat Intelligence Index revealed that the manufacturing sector was afflicted by the most ransomware cyberattacks and became one of the most extorted industries in 2022.
The manufacturing industry is a particularly attractive target for malicious actors because of their extensive intellectual property and sensitive financial information that can be compromised. A low downtime tolerance is also viewed as a huge opportunity for attackers to take advantage of.
Cyber Threats the Manufacturing Sector Faces
Manufacturers in Wales encounter various cyber threats that can disrupt operations, compromise sensitive data, and incur substantial financial losses. Some prominent cyber risks include. Here are some examples of key cyber risks that the manufacturing sector should be aware of:
Supply Chain Vulnerabilities
Manufacturing relies heavily on complex supply chains, making it susceptible to cyber risks stemming from third-party suppliers. An attacker targeting a weak link in the supply chain can gain unauthorized access to sensitive systems or inject malicious code into components, leading to compromised products. Thanks to the world’s reliance on global supply chains, hostile nation-state actors are now targeting the manufacturing sector. These sophisticated threats use advanced malware to exploit underlying vulnerabilities in IT systems, and therefore obtain sensitive information or disrupt vital operations. For example, in 2022, a new ICS (Industrial Control System) focused threat group named Chernovite surfaced using a next-gen ICS hacking platform called PIPEDREAM, designed to target technologies supported by different third-party vendors.
Malware and Ransomware
Ransomware poses a significant threat to manufacturers, where critical systems and production lines can be paralyzed until a ransom is paid. Such attacks can disrupt the supply chain and result in costly downtime. These attacks can result in a loss of competitive advantage, denial of access or damage to operational systems including production facilities. Significantly, it can also negatively impact a manufacturer’s trading reputation, leading to a loss of customers. According to IBM’s 2023 Threat report, phishing attachments were in the top 2 infection techniques used by attackers, alongside exploitation of public facing applications (any free or paid application or system that can be accessed by the public and an internal network, for example, Dropbox).
Intellectual Property Theft
The manufacturing sector invests heavily in research and development, making it an attractive target for intellectual property theft. Competitors or state-sponsored actors may attempt to steal proprietary information, designs, or manufacturing processes, impacting a company's competitive advantage. Intellectual property theft is a serious security concern in the manufacturing sector. If a malicious actor can access information such as product designs, source code, formulas, customer data and other sensitive materials the repercussions can be catastrophic to the business. For example, in May 2022, cyber security firm Cybereason published a report detailing the “sophisticated and elusive” cyber espionage hacking campaign targeting sensitive proprietary information of technology and manufacturing companies in East Asia, Western Europe and North America. This was conducted by the Chinese state-linked APT group, who manged to penetrate the companies systems through vulnerabilities in its enterprise resource planning (ERP) platforms.
Protecting IP requires an integrated approach. This includes monitoring potential malicious activity, strong access controls and investing in effective cybersecurity solutions. Many manufacturing companies now use zero trust architecture to protect their intellectual property, as it combines authentication and encryption technologies to securely limit access and data flow.
Industrial Espionage
Wales hosts a wide range of manufacturing industries, including aerospace, automotive, and pharmaceuticals, making it a prime target for industrial espionage. Cybercriminals may attempt to infiltrate manufacturing networks to gather intelligence on new products, technologies, or trade secrets.
Insider Threats
While external cyber threats are a significant concern, manufacturers should also be mindful of internal risks. Disgruntled employees or individuals with malicious intent may exploit their authorized access to systems, causing significant damage or data breaches.
Addressing Cyber Risks in the Manufacturing Sector
To mitigate cyber risks effectively, manufacturers in Wales can adopt several proactive measures:
Implementing Robust Security Measures: Manufacturers should establish robust cybersecurity protocols across all areas of the business, to build the layers of security needed to operate confidently now and in the future. Basics such as simply understanding what data you have, where it is stored, who has access to it and how this is controlled can begin the right conversations around security in your business. Cyber security assessments and audits will also help identify vulnerabilities and implement necessary safeguards to build a roadmap to improve security across the organisation.
Employee Awareness and Training: Employees should be educated about cybersecurity best practices, including recognizing phishing emails, using strong passwords, and reporting suspicious activities. Regular training sessions can help create a culture of security awareness within the organisation. Reducing the change of human error can be critical in protecting an organisation from attack.
Secure Supply Chain Management: Manufacturers should conduct thorough due diligence when selecting suppliers and partners. Implementing contractual obligations related to cybersecurity and regular assessments of third-party security controls can help reduce supply chain vulnerabilities.
Incident Response and Business Continuity Plans: Manufacturers should develop comprehensive incident response plans to minimize the impact of cyber incidents that cause operational downtime, reputational damage and data protection repercussions. Regular backups, disaster recovery strategies, and effective communication protocols can help restore operations swiftly in the event of a breach.
Collaboration and Information Sharing: Sharing threat intelligence and collaborating with industry peers, cybersecurity experts, and relevant government agencies can enhance the collective defence against cyber risks. Participating in cybersecurity forums and industry associations can provide valuable insights and support.
Next Steps
The manufacturing sector in Wales faces significant cyber risks in today's digital landscape. By understanding the threats and implementing proactive security measures, manufacturers can safeguard their operations, protect sensitive data, and maintain their competitive edge. It is crucial for organizations to prioritize cybersecurity and adopt a proactive stance to stay resilient against evolving cyber threats in the manufacturing sector.
Any cyber-attack can have a wide range of negative consequences, including downtime of operations, physical and human impacts, and even environmental damages.
In basic terms, protection is always better than cure and weighing up the cost to the bottom line of each day of operation lost through an attack, compared to the cost of putting in place the appropriate security measures is a simple way to illustrate this.
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