Supply Chain: Best Practices For Cyber Risk Management

  • March 27, 2023

As the world becomes increasingly interdependent and complex, it has likewise become incredibly hard to provide a product or service without a supply chain. However, this dependency creates extra risks – from significant business disruptions to reputational losses. In 2021, for instance, numerous organizations were affected by supply chain cyberattacks that can result in system downtimes, financial losses, and reputational damage.

For this reason, it is important for companies or organizations to improve the way they manage supply chain risks by adopting more robust practices for cyber risk management.

With nearly all business interactions and processes going digital, cybersecurity is the key to stable and safe supply chain operations. Read on to discover some of the best practices for cyber risk management that every business should embrace to protect their supply chain processes.

1. Perform a risk assessment 

Before taking any action to improve the security of your supply chain, it is necessary to evaluate possible risks. To do so, you must understand your supply chain and determine its crucial components. Identify who your suppliers are and analyze their level of cybersecurity. For this purpose, it may be helpful to group vendors into various risk profiles, prioritizing every third party according to their vulnerability level, impact on your business, and access to your data and systems.

Figure out the weakest points in your supply chain, and determine whether you can supplement these suppliers or ask them to enhance their security. Aside from individuals and organizations in your supply chain, be aware of the safety of all hardware and software products supplied to you. To have a better overview of the risks, you can illustrate a tree of all interactions between your company and supply chain elements. This will help you monitor connections and visualize supply chain risks.

2. Secure your data 

The way significant business is gathered, processed, and stored is essential when it comes to supply chain security. Because of this, you need to have effective network security in place and secure your business data on several layers – from the separate applications utilized by your company to the entire infrastructure. Try to improve your cybersecurity by using data protection technologies, such as tokenization, encryption, and data diodes.

In Singapore, data diodes are a fail-safe way to secure confidential data and protect sensitive systems. Specifically, data diodes by ST Engineering are used in numerous industries in the country and around the world because they come with an extensive range of advanced cybersecurity solutions, including endpoint security and threat intelligence, that effectively minimize the risk of data breaches and monetary losses in business. To avoid significant losses, be sure to secure data management not just within your company but across the infrastructures of all your suppliers.

3. Collaborate with your suppliers to enhance security

It is difficult to maintain a secure supply chain if you do not have close collaboration with your suppliers. Maintaining clean communication with your suppliers on a regular basis is vital for preventing supply chain vulnerabilities. You can schedule gatherings or visits dedicated to enhancing supply chain security and resilience, as well as carry out training to raise awareness among third parties.

It is necessary to communicate your security standards and needs to your suppliers and look for ways to make them uniform throughout your whole supply chain. To outline duties in your collaboration with third parties, you should consider utilizing service-level agreements (SLAs), which can assist you in communicating and standardizing requirements among your suppliers. SLAs can also make your suppliers accountable for cybersecurity incidents that might be caused by them.

4. Monitor the activities of your suppliers 

To minimize the possibility of a malicious insider attack in your company, consider putting in place constant activity monitoring for your suppliers and other supply chain entities that access your system. By monitoring all external users accessing your network, you can increase the accountability of your suppliers and enable efficient investigation in case of an attack. Moreover, monitoring of third-party activity is a common requirement in IT compliance. 

To monitor the activities of your suppliers for security and efficiency purposes, you may invest in a reliable manufacturing scheduling software like Parsec’s TrakSYS software. TrakSYS is a trusted production planning and scheduling platform that is equipped with various tools to streamline the operations of an organization. It acts as a calendar that details every component of a production cycle, and this schedule encourages accountability and on-time accomplishment of key tasks.

5. Build an incident response plan

No matter how much you try to protect your systems, risks in the supply chain are sometimes simply inevitable. Because of the unforeseen nature of these risks, it is essential to expect that your systems will be compromised at any time and establish defences so that in the event that a third-party-related incident occurs, you will be prepared completely.

Based on the results of your risk assessment, come up with a thorough incident response plan for your security teams. This plan must include roles, procedures, and conditions of responses to a potential security incident. If a security attack occurs outside your perimeter, it is important to provide assistance to a third party in reducing the consequences because supply chain security is your security too. 


The numerous advantages of supply chains come at the price of risks presented to each entity in the supply chain, particularly cybersecurity risks. Due to the tight interconnection in the supply chain, it raises the possibility of different kinds of attacks, such as supply chain attacks, third-party attacks, and destructive activities inside your company. Hence, you need to strengthen the security of your supply chain and make it less vulnerable to potential threats by following the best cyber risk management practices enumerated in this article.

If you are looking to make your data more secure and improve the protection and efficiency of your supply chain operations, Allied Solutions is the industry expert that can help you! Allied Solutions provide the most excellent automation systems and industrial manufacturing systems that can effectively optimize every aspect of a supply chain, such as data diodes and many more. Do not hesitate to contact us today to learn more about our products and services.

Still unsure with what we can give you?