Supply Chain Risks

keyboard with backdoor icon

Do you know who you do business with? A question with a seemingly obvious answer. But let me rephrase. Do you really know who you do business with? Who has access to your sensitive information? Who is sharing your sensitive information? Is that information being shared with other suppliers? Don’t know the answer? Don’t worry. You’re not alone.

According to a survey conducted by the Ponemon Institute in the fall of 2018, it was found that only 35% of companies had a list of all the third parties they were sharing sensitive information with. And only 18% of companies knew if those vendors were, in turn, sharing that information with other suppliers. You may be wondering what the necessity in knowing this information is. Well, the same survey found that 56% of organizations had a breach that was caused by one of their vendors. If you’re going to screw up, at least let it be on your part and not on that of an external party.

To be blunt, these figures are pretty pathetic. Especially since the average number of third parties with access to sensitive information at each organization has increased from 378 to 471. This increase comes following the widespread acceptance of globalization, making it harder to be certain of the integrity of an organization’s hardware supply chain. Let’s be real, almost every company uses outside hardware. As much as we might like to think we can do everything, nobody builds all their technology from scratch anymore. As such, we depend on our supply chain, meaning there might be multiple phases our hardware goes through before eventually reaching us. What’s worse is that, following the world economic crisis, budget cuts were made for manufacturing and security validation leading to the decline in use of authorized re-sellers. As a result, orders today are coming from manufacturers in the Far East as the prices are lower (and who doesn’t want to save a bit of money am I right?). All these various layers leave plenty of time for that hardware to be compromised; maliciously or ignorantly. Let me put it this way: every vendor and third-party organization your company interacts with is a security risk as they have people who are outside of your direct scope of policy control, so it’s probably best you know who you’re dealing with. But one criminal is hard to spot in a company employing hundreds, if not thousands, of employees, so it’s probably better to implement some mitigation solutions.

“We worry about manipulation, we worry about espionage, both nation state and industrial level, and we worry about disruption.” – Edna Conway, Chief Security Officer for the global value chain at Cisco Systems, Inc.

Hardware with embedded malware can enter your organization from a third-party supplier. That supplier may have a vicious employee looking to create damage, or an employee that has unknowingly allowed for this to happen. Either way, for the criminal the jackpot is to get an organization to use the malicious hardware to extract sensitive data. Ultimately, we need to make sure that not only do our third-party suppliers have sufficient risk management methods in place but, as Eric Doerr emphasized, also ensure that the employees work thoroughly, and with the right intentions. So employing someone with a history of cyber crime is probably not someone you would want your supplier to higher.

 

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