Cargo Chat: Mitigating cybersecurity risks in a tech-driven world

The pandemic compelled supply chain operators to hasten technology adoption, sparking digital transformation within the industry. [caption id="attachment_57145057" align="alignright" width="276"] Abe Eshkenazi[/caption] While this shift has resulted in increased traceability — with more tools for data-sharing for sustainability and supply chain collaboration — it has also led to increased cybersecurity risks, Abe Eshkenazi , chief executive of the Chicago-based nonprofit Association for Supply Chain Management (ASCM), told Air Cargo Next . Cybersecurity breaches cost companies an average of $4.8 million per incident as well as substantial operational disruptions, according to ASCM. Supply chain operators now face challenges in the wake of geopolitical disruption, the proliferation of AI and machine learning, and an increased regulatory framework about data sharing, Eshkenazi said in a conversation with Air Cargo Next . What follows is an edited version of that conversation. Air Cargo Next : What are the greatest tech strides the supply chain industry has made since the pandemic, and where are the weak links in the chain that could be vulnerable to cyberattacks ? Abe Eshkenazi : I think where we've seen probably the most significant change within the supply chain since the pandemic is the focus on digital transformation. The good news is we now know — or we should know — everybody and everything in our supply chain. The bad news is that, we now know everything and everybody in our supply chain, and we're finding out that we're not as resilient, we're not as sustainable and we're not as clean as we had thought that we were. The focus right now is on big data and analytics. It is on integrating everybody within your supply chain. With technology, I can get an early warning if there is a disruption, not just in my supply chain, but my extended supply chain. So, there’s quite a bit of effort on data, technology and information. The positive news is that we're trying to integrate everybody within our network. The challenge is that, when you go beyond your first tier of suppliers — you're talking about small and medium-sized enterprises — they don't have the capacity, they don't have the technology and they don't have the expertise to maintain that kind of technology. We're pulling on a very tenuous thread right now of integrating everybody, knowing that supply chains are more like a web as opposed to a sort of linear activity. ... Integrating everybody through digital technology , whether through AI, machine learning, it is now exposing organizations to cyber-risk that heretofore we did not really anticipate. Air Cargo Next : How do supply chain operators mitigate the risk of cyberattack? AE : It's really hard because we're pushing on the availability of information, and that requires trust, and so I need to know everybody in my system so I can partner with them to ensure that I'm getting accurate information. But, at the same time, [I need to know] that I'm protecting my organization from the type of risks that are associated with technology , especially unfettered technology. The challenge we have is two-pronged. First, I think it's the technology itself, and trying to get a handle on it, ensuring that the architecture, the encryption, the training, all the appropriate risk protocols are applied across the system. This also applies to knowing your IT security protocols across your partner network. I think that's critical. I know the impact is on the larger organizations. But I think the other impact that we're maybe ignoring is consumer confidence. When we start seeing these types of disruptions, it creates doubt and confusion among the consumers. “Do I trust the systems that are giving me the information right now?” [How is] consumer confidence in our supply chain, whether it be the availability of goods, essential medicine or vaccines? I think there's quite a bit that needs to be addressed in terms of mitigating that risk to the consumer and to the general public. Air Cargo Next : What is critical for supply chain employees to learn and adapt to as far as cybersecurity risks and technology? How do you see this evolving? AE : One of the issues that I think that we've identified is the focus on the talent side, or matching the investment that you're making on the technology side. Technology is fantastic. I think supply chains are early adopters of technology, specifically within machine learning, AI, blockchain. This is an industry that embraces technology, especially if it creates efficiencies for their processes. One of the concerns that we have is the training of the individuals . On the data, on the technologies, [you need] trained individuals that can discern the information coming in and out of the systems. We're not seeing an investment at the same level on the talent side as we are on the technology side, and that's a concern for us in the long term, because ultimately it's the individuals that have to discern, “Well, what is the system telling me? Do I just take it at face value?” For example, who would have ever predicted the issues in with the Houthis and the Red Sea ? What model would have ever predicted that that would have been a disruption for the supply chains in this global geopolitical environment that we live in right now? You need to have knowledgeable and trained individuals that use their experience, that use their previous relationships with their suppliers, to understand and mitigate those risks. I think that's one of the areas that we'd like to see a little bit more emphasis on: the individual side, in addition to the investment in the technology.

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