Cyber, hacker, pirate and terrorist attacks against global supply chains will rise over the next 20 years, and firms should plan now to protect their assets, says a report released June 21, 2011.
Eighty executives see a 56 percent probability of increased attacks on supply chains, according to a survey by PwC, a consultancy. Their greatest concern is for hacker attacks on supply chains rather than for actual physical attacks.
“Cyber attacks are now so sophisticated that any business, or even country, could be at risk,” according to the PwC’s “Transport & Logistics 2030 series: Securing the Supply Chain.”
“Today 90 percent of the worldwide trading volume is concentrating on about 39 gateway regions,” said Klaus-Dieter Ruske, partner and Global Transportation and Logistics Industry leader at PwC. “If only a single one of these hubs fails, the economic consequences could be enormous after just a short period of time, and affect most economies around the globe.”
The Strait of Homuz, the Suez Canal, the Panama Canal and other highly frequented “chokepoints”—geographic bottlenecks with only one narrow transport link across a valley or bridge—are potential targets, said Ruske.
Egypt already loses more than $640 million each year because shipping companies avoid passing through the piracy-threatened Gulf of Aden and the Suez Canal.
“Capital investment on security, also on security of IT systems, will be one of the most important cost drivers of the logistics industry,” Ruske said.
Businesses should draw up contingency plans now to avert the economic impact of such attacks, the report says.
Survey respondents said there is a 70 percent probability of logistics companies having to perform obligatory security checks on their whole supply chain and a 60 percent probability that modern technology would offer businesses better protection.
Freight screening as well as “risk” profiling of employees, and using trusted shipping operators, will also help businesses stay ahead of the hackers, the report adds.
“Enterprises will have to analyze and counteract every possible scenario of danger to protect their supply chains,” said Ruske. “It is not just about prevention, but also about developing alternatives for the case of emergency. Thus every enterprise should be prepared to quickly compensate any drop out of a supplier.”
