What is the true cost of cyber espionage to manufacturers?

Cybersecurity threats continue to pose significant challenges for UK businesses. According to the UK Government's Cyber Security Breaches Survey 2024, 50% of UK businesses reported experiencing a cyber-attack or security breach in the previous 12 months. Notably, 84% of these incidents involved phishing attempts, underscoring the prevalence of this threat vector. The manufacturing sector has been particularly impacted, with a 42% increase in cyber extortion attacks in 2023 compared to the previous year, making it one of the most targeted industries. These findings highlight the critical need for robust cybersecurity measures, including comprehensive employee training to recognise and respond to phishing attempts promptly

Why are manufacturers targeted?

A common misconception is that the more consumer data you hold,  the more vulnerable you are to cyber-attacks. If manufacturers have a viewpoint such as this, it creates vulnerability, as the company will be less inclined to worry about data security. But intellectual property, trade secrets, business processes, financial details and future plans can all be potential objectives for cybercriminals.

Also, manufacturers are often part of a complex and large supply chain, which cybercriminals can use to their advantage as there have been cases where cyber-attackers gained unauthorised access to one company system to gather information or attack another company.

Data security

According to Verizon’s 2024 Data Breach Investigations Report, phishing remains a major threat, accounting for 15% of all data breaches. The report also highlights that 68% of breaches involve a non-malicious human element, such as falling victim to phishing or simple user error. Alarmingly, the median time for a user to fall for a phishing email is less than 60 seconds. These findings reinforce the importance of employee awareness and training. Ensuring that staff can recognise suspicious emails and understand how to respond is a vital step in reducing data security risks.

The potential costs of cyber espionage

Potential costs of fallen victim to cybercrime can be varied from research and development data being stolen to brand reputation damage.

Imagine if your intellectual property was stolen or your next idea was taken and given to competitor? Manufacturers could lose out by being undercut in both costing and time to market. But it's not just lost revenue that is at stake. Cyber espionage also provides a greater threat to the economic security of brands both large and small – and that's not all.

In the era of the 'Internet of Things' (IoT), such hacking and data breaches aimed at manufacturers may well make it into the homes and put consumers at risk as well. Fridges, heating systems, light bulbs and even ovens can now all be connected to the internet. The data supplied by users in the daily running of lives and households is stored by manufacturers often innocuously, as often as part of the product improvement process. All this data is valuable and can be a sitting target.

Manufacturing businesses need to be more vigilant before instances of cyber espionage can decline in the sector. Cyber-attack is a serious issue, a breach can destroy a company.

Minimising data security risks

As mentioned earlier, training employees about the dangers of cyber-attacks and how to spot a potential threat is just one of the ways, other things include: -

• Assess the IT infrastructure for vulnerabilities as something as small as using unsupported or unpatched software can be a risk.
• Look at user roles and permissions on your core business systems. Restrict or allow access based on what is required for the user to carry out their job. With restrictions in place if the unthinkable happened it may help with the prevention of the cyber-attack spreading.
• Set a company password policy, such as enforcing user password rules where a combination of numbers, symbols and letters are required or changing passwords every few months. Simple things can make a difference.
• Regularly evaluate existing preventive measures and continuously improve.

There is no ultimate solution when it comes to cyber-security as technology is always changing - but manufacturers must do as much as they can to protect the business.