Product Update
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In today's interconnected business landscape, organisations rely heavily on a network of suppliers to maintain their operations. However, not all suppliers pose equal risks to your organisation if breached. Understanding which types of suppliers present the greatest potential threat is crucial for effective third-party risk management and cyber security strategies.
The most important suppliers to your organisation are those that you rely on for critical business functions. These include providers of:
A breach of these suppliers could severely disrupt key business operations, forcing organisations to rely on inefficient workarounds or halt operations entirely.
Another high-risk category includes suppliers that process or store sensitive corporate or customer data. Examples include:
A breach of these suppliers could result in significant data loss, potentially damaging your organisation's reputation and exposing it to legal and regulatory consequences.
As organisations increasingly integrate third-party tools and services into their offerings, the technology stack and inputs into third-party software has also become a critical area of concern. This category includes:
A compromise in the software supply chain can have far-reaching consequences, affecting not only your organisation, but also your customers and partners.
Suppliers granted direct access to your systems or those deeply integrated within your infrastructure pose a significant risk. These may include:
A breach of these suppliers could potentially give attackers direct access to your organisation's core systems.
But this is not all. There is an entire additional universe of risks beyond your third-party connections. Your suppliers have suppliers, who also have suppliers, etc. It’s a bit like LinkedIn where you have 1st, 2nd, and 3rd degree connections, which makes supply chain risk one of most challenging threats to mitigate. McKinsey agrees. It says, “Supply-base transparency is hard (or impossible) to achieve. In modern multi-tier supply chains, hundreds or thousands of suppliers may contribute to a single product.”
Data from the National Cyber Security Centre shows that only 13% of organisations review their immediate suppliers, and just 7% investigate risks beyond third-parties. At the most basic level, you need to know who sits in your supply chain, because you can’t protect yourself against what you can’t see.
It doesn’t matter if you’ve invested in a robust security system and employ the top security talent, a threat actor will use a small supplier to infiltrate your network – and that supplier may not even work directly with you. Threat actors actively seek to exploit your nth parties to gain access to your data.
As organisations continue to rely on an expanding network of suppliers, identifying and managing high-risk vendors becomes increasingly critical. By focusing on suppliers that support critical business functions, handle sensitive data, contribute to the software supply chain, or have direct system access, organisations can prioritise their risk management efforts more effectively.
But this is just the start. It is clear that traditional TPRM approaches are no longer sufficient in today's rapidly evolving threat landscape. Organisations must adopt more dynamic, comprehensive, and continuous assessment methods to ensure the security of their supplier ecosystems. Only by addressing these challenges can businesses hope to maintain a robust security posture and compete effectively in an interconnected world.
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