New report reveals cybersecurity risks in manufacturing

Telstra International, in collaboration with Omdia Research, has published a new whitepaper titled "Secure Manufacturing: The Challenges of IT/OT Convergence," revealing significant cybersecurity vulnerabilities in the manufacturing sector.

The findings indicate that while 80% of manufacturing firms experienced a rise in security incidents or breaches last year, only 45% felt adequately equipped to manage these threats. This highlights a stark contrast between the perceived threat landscape and the readiness of these firms to defend against cyber threats.

The whitepaper focuses on the impact of Industry 4.0, which is driving the convergence of Information Technology (IT) and Operational Technology (OT) in manufacturing, creating opportunities for efficiency and innovation but also widening the scope for cyber attacks. A notable 75% of security attacks on OT systems are initiated from within IT environments, particularly at higher levels where data processing occurs. These include types of attacks such as Advanced Persistent Threats (APT), malware, and Distributed Denial of Service (DDoS) attacks.

Geraldine Kor, Head of Global Enterprise Business at Telstra International, remarked, "Greater connectivity between IT and OT is necessary to harness advanced technology for manufacturing innovation, but it increases the risks of a breach. However, very few firms are mature in protecting and defending against such cyber risks." She further pointed to a fragmented approach to security responsibilities in manufacturing, suggesting that responsibility must be clear and integrated for an effective security posture.

Manufacturers that fell victim to cyber attacks reported financial losses from USD $200,000 to USD $2 million per incident, with the most severe impacts noted when enterprise and corporate systems or production control were affected.

Ganesh Narayanan, Global Head of Cyber Security for Telstra International, commented on the traditional reliance on air gapping to secure OT systems. With IT and OT convergence, this model is increasingly ineffective as it expands the threat surface. He advised prioritising IT/OT and IoT security through collaboration, strategy definition, technical expertise, responsibility assignment, leveraging the right tools, and ensuring readiness.

Omdia's study drew insights from over 500 technology executives across various sectors and regions, examining the integration of IT and OT in the context of security challenges. The study found an 80% increase in security incidents, but only a fraction of manufacturing firms had the advanced security maturity to manage these converged environments.

Adam Etherington, Senior Principal Analyst at Omdia, highlighted the importance of understanding the key attack vectors and implementing lessons learned. "More pervasive connectivity between IT and OT is essential across greenfield and brownfield manufacturing system design and enhancements," he said, indicating a need for firms to adopt technologies such as cloud, IoT, AI, and private networks.

The responsibility for OT security is increasingly shifting towards IT leaders like Chief Information Security Officers, as the traditional model of engineering-led security oversight becomes less effective with IT/OT integration. Etherington emphasised the critical need for proactive measures in addressing these security challenges, considering the significant downtime costs reported by firms affected by breaches or network incidents.

Many manufacturing companies are looking to outsource IT/OT security due to a shortage of skilled professionals. Research indicates North American firms are leading in this trend, with a considerable proportion anticipated to outsource IT/OT security within the next 18 months.

The survey, conducted in September 2024, included respondents from a wide array of manufacturing sectors, reflecting diverse organisational sizes and regional contexts. The findings underscore the challenges and opportunities manufacturers face in the evolving landscape of IT and OT convergence.