The logistics industry plays a critical role in both the global and domestic economies, ensuring the smooth movement of materials and goods across various networks. However, with the increased digitization of operations, there is also a rising threat from cybercriminals. Here’s why supply chains and logistics providers need cybersecurity measures and how these businesses can enhance cybersecurity in logistics and shipping.
Why Supply Chains Need Strict Cybersecurity Measures
The transportation and logistics industries are prime targets for cybercriminals because they can give them access to other systems and destabilize the supply chain. According to a Gartner survey, 60% of logistics companies view cybersecurity risk as a serious threat.
Costs Associated With Cyberattacks
The effects of a cybersecurity attack on the logistics and transportation industry can be far-reaching and significant:
- Disrupted Operations — Cyberattacks can completely halt your logistics and transportation operations, leading to missed deadlines and a poor customer experience.
- Damaged Reputation — Trust is critical in the logistics sector. A cyberattack resulting in the loss of private data or service disruptions can impact consumer confidence and damage your business’s reputation.
- Financial Losses — When a cyberattack leads to operational disruptions and reputational damage, this can result in financial losses for the business.
Common Types of Cyberattacks in Logistics
Here are some of the most common ways cybercriminals can attack a logistics or transportation business:
Phishing Attacks — When employees fall prey to deceptive emails or click on malicious links, cybercriminals can gain access to a system and exploit its vulnerabilities. - Ransomware — This type of attack involves encrypting sensitive systems and data and then holding them hostage until the company pays a ransom. In logistics, this can stall operations completely.
- Man-in-the-Middle (MitM) Attacks — Through a MitM attack, hackers intercept communications between two parties to gain access to and exploit sensitive data.
- Distributed Denial of Service (DDoS) — A DDoS attack is designed to overwhelm a system’s resources so that it isn’t usable for normal operations. In transportation, this could create frustrating and dangerous situations.
Examples of Cybersecurity Incidents in Logistics and Shipping
The last thing you want is to become the victim of a cybersecurity attack or become indirectly impacted due to an attack on a supply chain partner. These events can be costly and erode confidence in your brand. Here are a few examples of past cybersecurity incidents in logistics and shipping.
Port Attacks
In 2021, the Port of Houston was “attacked” by cybercriminals who installed malicious code that was designed to export login credentials through a system vulnerability. Fortunately, the attack was detected in time and stopped. Another attack in 2022 targeting the Jawaharlal Nehru Container Terminal was successful when cybercriminals were able to redirect an incoming vessel.
Expeditors
The freight forwarder Expeditor was the victim of a hacking attack in early 2022, causing the company to shut down most of their global operations to avoid further infection. The company indicated that it had incurred significant expenses to investigate and recover from this cyberattack.
SolarWinds
In 2020, hackers infiltrated the SolarWinds’ Orion system through a system update. The malicious code was then sent to the company’s 33,000 customers, which created backdoors into various government agencies and company systems worldwide. This hack was undetected for months and resulted in a massive but unknown amount of data breach.
Colonial Pipeline
In 2021, a ransomware attack was carried out on the Colonial Pipeline on the East Coast of the U.S. Thought to have originated from an Eastern European group of hackers; these criminals demanded 75 Bitcoin in ransom to remove the malicious code. The attack occurred when an employee reused a previously leaked password, and resulted in fuel prices spiking across the U.S.
Enhancing Cybersecurity in Your Shipping and Logistics Operations
While it’s important for shipping and logistics companies to continue adopting advanced digital technologies to enhance their operations, it will also become increasingly necessary to implement quality cybersecurity protocols alongside these upgrades to mitigate risk. Here are some ways your business can enhance cybersecurity in its shipping and logistics.
1. Raise Employee Awareness
According to Kaspersky, nearly half (48%) of cyberattacks are directly caused by employee negligence. Your entire workforce, from management to frontline employees, must understand and follow strict cybersecurity procedures. These include having strong passwords, avoiding outside links or downloads, and only using approved company devices for work.
2. Secure Your Internal Systems
Your hardware, software, and organizational structure must be protected against cyberattacks. For example, your business should be using modern hardware or cloud-based systems that offer cybersecurity protection. Other security tools include antivirus software and firewalls to provide a first line of defense against attacks. There should also be SSL certificates and encryption, as well as end-to-end compliance with cybersecurity measures among business partners.
3. Conduct Regular Security Audits
Frequent audits of your security system can identify any weaknesses before a criminal can find and take advantage of them. You can do things like penetration testing to simulate a cyberattack. Your security audits should take place once or twice annually. If you aren’t sure how to do this in-house, consider contracting with a reputable provider to get these audits done.
4. Create an Incident Response Plan
Even with all the right preparation, cybersecurity incidents will still happen. When they do, you want to be prepared to respond swiftly and appropriately. You can be ready to respond to the worst-case scenario with a comprehensive incident response plan. This plan will detail how your team can isolate and minimize breaches, reduce disruptions, and communicate with internal and external team members.
The need for advanced shipping and logistics services has risen in recent years in the face of digitization and the rise in e-commerce businesses. As the industry experiences significant growth along with the use of more digital services, it has become a primary target for cybercriminals. Enhancing cybersecurity in logistics and shipping can improve efficiency as well as protect your operations from various hidden security risks.
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