Agility in Manufacturing: Technology and Cybersecurity

I want to wrap up our series on “agility in manufacturing” with a look at the role of cybersecurity in the manufacturing world — a theme I think will play an increasingly important role in scale and growth for privately held and family-owned manufacturing businesses.

On the surface, the link between security and agility may not be obvious. After all, we usually associate security with cautious (even conservative) thinking around change and adopting new approaches. But making sure you have a solid security framework in place to protect all your digital assets actually gives your manufacturing business an enormous advantage.

(Side note: When I started writing this series back in October 2022, Deloitte had already highlighted cybersecurity as a top-five trend for manufacturing companies. They’ve just released their 2023 Manufacturing Industry Outlookreport, and “investing in advanced technologies to help mitigate risk” is now at the top of their list for the coming year.)

The fact is, investing in the right technologies — particularly cloud-based software solutions — helps lower a company’s security risk and allows them to scale effectively.

Cyberattacks Are a Real and Present Danger

As any reader of this blog knows, I’m a big fan of technology — it’s our bread and butter here at Syte. Our core expertise is helping privately held manufacturing companies leverage technology to grow their business.

But the unfortunate reality is that any company that uses technology to run their business operations is a potential target for a cyberattack. Manufacturing companies are no different, and in fact, they’ve become a rich target for malevolent actors in recent years.

The motives may differ — some hackers use ransomware to extract financial gain, while others are more surreptitious in order to steal intellectual property, and still others just want to wreak havoc and watch their victims scramble. Whatever the goal, the damage and knock-on effects can devastate a business, as well as its partners and customers.

Some of the more “low-tech” versions of these cyberattacks involve phishing campaigns, where company employees are targeted by seemingly legitimate emails that are designed to deceive. The goal is usually to steal personal information, or even money (as happened at FACC, an Austrian aerospace parts maker, when hackers impersonated the company CEO and stole millions from unsuspecting employees).

But even if such an attack doesn’t result in a direct financial loss, there are other risks. Manufacturing companies have an enormous amount of information that could be stolen and sold for profit by bad actors. A data breach involving personal or sensitive information would result in significant reputational damage. Theft of their proprietary information and processes could destroy their competitive advantage. And with today’s integrated networks of businesses and vendors, a successful cyberattack on one part can lead to disruptions all along the supply chain.

So cybersecurity isn’t just a concern for “high tech” companies — it’s a concern for every company in every industry.

Interconnectivity Can Be a Double-Edged Sword

I’ve written before about why I think that a Digital Operations Platform (DOP) is the next phase in the evolution of ERP. And cybersecurity has a role to play here too.

When we work with a new manufacturing client who’s looking to evolve their business operations in order to grow, we often find that they’re working with a legacy patchwork of systems. The problem with them not being connected to one another is that business doesn’t run as efficiently as it could. But not being connected also means that they’re sort of firewalled from each other — one system can’t be compromised via access to another.

From a security standpoint, however, this is still far from ideal. Having disparate systems within the manufacturing organization means that no single security framework can cover them all. Specific vulnerabilities have to be managed on a system-by-system basis, and that can be tough to keep up with (especially when IT and OT resources are limited).

So connecting all of those systems together (with an intelligent solution over top, like an ERP) really yields tremendous benefits in terms of efficiency and scale. As I wrote in my last article on agility in manufacturing, connectivity eliminates silos — and that’s a great thing.

The flip side is that when everything is connected, getting access to one part of the digital ecosystem often means getting access to the rest of it. A cyberattack isn’t always obvious, and threat actors can do a lot of damage before anyone realizes that the system has been breached. That’s why it’s so important to have the right protocols and safeguards in place to eliminate potential threats.

Manufacturing leaders can really help themselves in this area by choosing robust technology solutions for their business operations and partnering with their software vendors to make sure any vulnerabilities are understood and addressed.

Cloud-Based Technologies Help Lower the Risk

Let me just say that when many of our manufacturing clients are looking for a new ERP solution, they often start with the assumption that they need an on-premises solution. And we get it — on-premises solutions definitely provide a perception of control that’s important to a lot of manufacturing organizations.

But one of the downsides to opting for on-premises solutions is that the company’s IT and OT departments are responsible for maintaining, patching, and protecting those systems, all on their own.

With cloud-based technologies, cybersecurity becomes a shared responsibility.

This is why we’re seeing more and more of our privately held manufacturing clients opt for in-the-cloud software solutions. (Check out this infographic my team produced to capture our insights into how manufacturers have been making the journey to the cloud.)

Software vendors know their own software better than anyone, and they know how to protect it. Cloud-based solution providers also have a little more skin in the game: if their systems are compromised, so is their entire client base. There’s such a huge incentive for them to manage security well, because any breach would be a massive threat to their own brand.

A corollary to that shared responsibility is that the manufacturing company’s own (often limited) IT resources can focus on their end user base, rather than having to stay on top of existing and emerging vulnerabilities to the systems they manage. With more “eyes” on their tools, these mid-size manufacturing companies can manage threats on a much larger scale, without having to pour additional resources into that function.

Of course, it goes without saying that manufacturing organizations need to make sure that their employees are educated and trained on potential threats and appropriate protocols to mitigate them. Prevention is always the best medicine.

Staying Agile Means Staying Safe

Agility in manufacturing covers a range of areas, and while security is part of what makes agility possible, so is resilience. Having business continuity plans in place in the case of any disruption — no matter the cause — ensures that your manufacturing organization will be able to roll with the punches and recover quickly.

Are you thinking about your own cybersecurity protocols to make sure your business is protected as it grows? We’d love to help you evaluate your options. You can schedule a complimentary consultation session right here.