On July 19^th, cybersecurity platform provider CrowdStrike released an update that caused 8.5 million Microsoft Windows PCs and servers to crash.

The glitch triggered widespread disruptions to global supply chains, temporarily closing ports, delaying medical supplies and disrupting warehouse operations worldwide. 

Anthony Beavis, Managing Director ANZ at Körber Supply Chain Software, has penned an article about the three biggest takeaways from the widespread disruption.

Körber Supply Chain Software works closely with major Australian brands such as Officeworks, Myer and Catch.com.au. 

With nearly three-quarters of the world’s computers utilising a Microsoft’s Windows operating system, this single point of failure emphasized the fragility of our interconnected systems.

Although the issue was resolved within a day, the repercussions of the brief disruption will likely be felt for weeks—if not months.

The increasing complexity of digital workflows and integrations has heightened the vulnerability to glitches and cyberattacks within modern supply chains. It’s an issue which has caused huge financial losses and damaged reputations to organisations across the world. 

The World Economic Forum’s Global Cybersecurity Outlook 2024 has revealed some alarming statistics about the state of the problem:

• 29% of organisations reported material effects from cyber incidents in the past year
• 41% of these incidents were caused by third parties
• 54% of organisations have an insufficient understanding of their supply chain cyber vulnerabilities

We know that events like the Microsoft outage will happen again. Technology providers will suffer outages, and cybercriminals continue to lurk in the shadows, so senior executives need to understand whether their organisation is ready to handle cyber threats.

There are three key areas to focus on to help increase resiliency across digital supply chains. 

1. Conduct a holistic risk assessment

Organisations must conduct comprehensive risk assessments that include all elements of their digital supply chain, from warehouse management systems to third-party logistics providers.

Part of this is understanding the prioritisation of certain risks – which applications supporting critical business processes run on resilient technology platforms, and which don’t? 

By integrating cybersecurity into supply chain risk management strategies, organisations can effectively address and mitigate potential security breaches. Consistent implementation of security audits and comprehensive incident response plans is essential for quick action.

Collaboration across the supply chain is also key, as sharing threat intelligence, best practices and security protocols with partners and suppliers ensures a unified and fast response to threats.

2. Understand the technology balance for your organisation

CIOs and CTOs face a balancing act of dealing with a low appetite for new security features and the crucial need for robust, resilient systems.

The challenge is particularly acute in supply chain management, where the allure of cutting-edge technologies often overshadows the less glamorous but equally vital task of strengthening existing infrastructure.

Cloud-based systems can significantly reduce recovery times and ensure continuous availability of critical supply chain operations.

These investments, while sometimes costly, become essential when compared to the potential of millions in revenue lost during outages.

Senior executives should ask their technology teams:

• What resilience investments have we overlooked?
• How can we better align spending with the need for robust systems?
• What is the true cost of an outage to our supply chain operations?

To counter cybersecurity threats, organisations are adopting advanced security technologies such as artificial intelligence (AI), machine learning (ML), and blockchain.

These technologies enhance threat detection, improve response times and provide greater transparency and security across the supply chain.

In today’s complex digital landscape, maintaining operational integrity during technological disruptions is becoming a key differentiator.

For supply chain leaders, adopting a resilience-first mindset is essential for long-term success in a digitally driven world.

3. Build cultural buy-in through training and engagement

Cultivating a robust cybersecurity culture is essential for supply chain resilience, requiring ongoing efforts across the entire organisational ecosystem. 

Comprehensive cybersecurity awareness should extend from the C-suite to the warehouse floor. This may include simulated phishing tests to identify vulnerabilities across all levels of the organisation, recognising that even senior leadership can be susceptible to cyber-attacks. 

Tailored training modules should be developed for all roles, including front-line workers using networked scanners, handheld technology or connected machinery like forklifts and robotics.

By fostering an environment of understanding and learning, staff can be encouraged to embrace safe and secure practices as part of a broader mission.

Equally important is the implementation of robust change management processes. Most resiliency issues in supply chain operations stem from changes in configurations or software updates within the complex technology ecosystem.

By carefully managing these changes, organisations can significantly reduce risks and enhance their overall cybersecurity strength.

By prioritising these key areas, organisations can foster a culture of cybersecurity awareness that strengthens overall supply chain resilience and reduces the risk of disruptions caused by cyber incidents.