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Cyber Status of Manufacturing

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Cyber-crime is an almost invisible pandemic that has been infecting the world, and Australian manufacturers need to be on high alert. Cyberattacks worldwide are estimated to have stripped companies of US$8.4 trillion in 2022 and industries such as oil and gas have improved their cyber-readiness. Industry estimates put the cost of IT (Information Technology) attacks between $10-$20 trillion by 2025. According to IBM’s 2022 X-Force Intelligence Report, manufacturing became the most attacked industry globally in 2021 – replacing financial services and several of Australia’s biggest, high-tech firms were shocked by last year’s breaches and data theft. So, what has led to manufacturers being increasingly targeted by cyber criminals? This blog will look to provide a deep-dive analysis in this regard.

Perception of Soft Target

The speed at which manufacturers are integrating systems to catch up with the rest of the business world means little or no focus on security which makes them easy pickings. Digitization and systems integration is a new phase for most manufacturers so rookie mistakes are likely and hackers know this. As manufacturing has digitized, it has experienced more cyber-related incidents, often through interfaces and OT (Operational Technology) control systems managing industrial operations. Application Programming Interfaces (APIs) allow different systems to talk and share data. Every time a once-discrete system needs to talk to another, it uses an API and, without the right precautions, increases the attack surface. And, without adequate security, the convergence of OT and IT enables vulnerabilities in one area to be used by hackers to traverse to the other. Deloitte and the US’ Manufacturers Alliance for Productivity and Innovation (MAPI) studied cyber security and risks for manufacturing and structural steel fabrication. Almost half the manufacturers (48%) of 600 IT execs with global firms surveyed by the 2019 Deloitte and MAPI Smart Factory Study said operational risks, such as cyber security, were the greatest danger to smart factory initiatives.

Low Priority

Industry experts say manufacturers’ attention to security suffers from many factors, not least workplace culture, including security awareness and different teams’ priorities:

  • Inadequate training: the World Economic Forum’s (WEF) Global Risks Report 2022 declared 95% of cyber security issues can be traced to human error and that insider threats, accidental or intentional, create 43% of breaches across all sectors.
  • OT teams naturally focus on physical machinery (e.g., mining plant and equipment), tangible products and maximizing production. Often wary of ‘interference,’ there is a reluctance to give IT oversight and a tendency for OT to integrate systems ad hoc.
  • Business leaders have not been sufficiently aware of IT risks. IT advisors struggle to get points on cyber security through to leaders. The C-suite has been criticized for preferring to pay cyber insurance than think about the issues. The prices for cyber insurance in the US have been skyrocketing: up by 96% in Q3, 2021 alone, and a 204% jump on the previous year, says the WEF.
  • Factory floors’ fear of downtime means systems have not been patched to latest versions so they are vulnerable. Old factory equipment that is near impossible to update to work with more secure OT.
  • Reports of complacency include one security provider’s survey of manufacturers’ knowledge of their systems and their APIs: it showed manufacturers’ confidence in their system security to be badly misplaced.

Final Thoughts

As smart factories are busy enhancing production and supply chain performance, greater interconnectedness brings greater risk with each interconnection enlarges the attack surface. Yet the trend to more connectivity and more smart devices in the Industrial Internet of Things (IoT) space is not slowing, and 5G networks’ next-level connectivity will accelerate it. The risks are huge and, whether on the cloud or on premises, businesses must be confident of the security of any externals with which they connect. Potential business partners can offer their bona fides but a manufacturer needs to diligently discover their true security posture, all their precautions and if they are vulnerable. In this matter, the old adage holds true: a chain is only as strong as its weakest link!

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The Rise and Rise of IIoT

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It is a well-known fact that IoT (Internet of Things), such as IoT in Oil and Gas, has been a buzzword for some time now. The concept of “smart” living which involves usage of wearables which transmit data on health, performance and monetary matters captured the imagination and led to the development of smart watches, BP trackers etc. This concept has now been extended to the industrial space with Industrial IoT, or IIoT, being the result. So, why should organizations adopt IIoT and what are the considerations and IT’s role in this regard. Let us find out more in this blog.

Uniqueness and Benefits of IIoT

IIoT connects machines and devices in industries such as manufacturing, steel fabrication, transportation, oil and gas, power generation and transmission, mines, and ports. Commercial, enterprise, or consumer IoT—also simply known as IoT—is used to describe connected devices within homes and office spaces, such as cameras, badge readers, and HVAC control systems. Failure of IIoT can have catastrophic consequences, creating high risk and potentially life-threatening situations. Downtime of other IoT devices may result in inconveniences, but it does not usually cause emergency situations.

Industrial IoT enables organizations to get a wealth of actionable data from their operations. When properly aggregated and analyzed, the data helps them better control operations, with the potential to improve worker safety, increase production uptime by predictive maintenance of machinery, maintain product quality, ensure regulatory compliance, and improve operational efficiencies.

Major Considerations for IIoT Adoption

  • Network Equipment – The switches, routers, and wireless equipment that connect IIoT devices must provide the needed bandwidth and be able to withstand punishing physical conditions on factory floors or outdoors. Equipment, such as mining and plant equipment, must support the communication protocols in use to provide visibility and help monitor each endpoint.
  • Centralized connectivity deployment and monitoring – For organizations to efficiently monitor and scale their deployments, centralized visibility of device connectivity is of paramount importance. Organizations need to be able to deploy and configure connectivity to their edge devices and equipment quickly and accurately.
  • Asset tracking and monitoring – Continuous tracking and monitoring of IIoT devices, assets, and facilities is essential to keep them up and running efficiently. Such visibility helps to quickly identify potential issues that could impact operations, worker safety, and revenue.

Role of IT in IIoT

  • Reliable Network – IT must strive to ensure that a reliable network with sufficient bandwidth capacity is in place so time-sensitive data can be transmitted without delay to applications in data centers or the cloud. The network that connects IIoT devices and sensors needs to support diverse physical channels.
  • Intelligent network control – The network for IIoT must be kept highly available. IIoT devices may be numerous and spread across a large geographical area, but a network controller can automate networking equipment deployment and keep configurations consistent, and firmware updated. It can also help ensure that devices are performing to expectations—and guide administrators to take corrective actions if not.
  • Security for critical resources – As IT and IIoT networks converge, security practices must also converge. Protecting IIoT is best done with a comprehensive, integrated security solution (including cyber security) rather than a multitude of point products. The same proven security tools that IT has deployed over the years can benefit IIoT as well.

Closing Statement

With the advent of digital manufacturing and industrial AI-based solutions, IIoT has the potential to deliver breakthrough business outcomes with simplicity, speed, and scale. It can empower modern industrial workers and can resolve business challenges by making use of industrial data. Additionally, IIoT can also increase efficiencies, reduce costs, and improve safety and security. IIoT is a revolution in the world of fabrication and manufacturing and it is poised to transform the world of metal operations!

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Cyber Security for Oil and Gas Companies

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With the advance of technology, the oil and gas utilities industry has moved to incorporate information technology (IT) into its upstream and downstream operations so as to achieve better oversight on productivity, real-time monitoring and control and a more productive working relationship with heavy steel fabrication companies. This has led to increased streamlining in the process of managing supply and demand; however, it has also made the industry more vulnerable to cyber-attacks. Cyber-attacks have the potential to inflict substantial damage on critical infrastructure, and this can lead to far-reaching consequences in an increasingly decentralized digitally connected energy ecosystem. This blog will discuss more about cyber-attacks and potential protective measures from such events.

Cyber-readiness of oil and gas companies

In May 2021, the possibility of a cyber incident with regard to the oil and gas industry was brought to the public’s awareness when U.S. pipeline operator Colonial Pipeline suffered a ransomware attack. The company was forced to stop running the systems that operate its 5,500-mile pipeline and the economic damage, including adverse impacts to the pipe fabrication industry, was tremendous. Europe’s oil products sector was hit in February 2022 when a cyberattack targeted loading facilities in Germany and spread to key terminals in the Amsterdam-Rotterdam-Antwerp (ARA) network. A total of 17 terminals (11 in Germany and six in ARA) were affected. This instance shows that attacks are becoming increasingly frequent – and more sophisticated. As early as 2017, the U.S. research institute Ponemon was commissioned by Siemens to conduct a survey of the oil and gas industry. According to its findings, 68% of U.S. oil and gas cyber managers said that their organization had experienced at least one loss of confidential information or disruption to operations in their Operational Technology (OT) environment over the past 12 months. At the same time, the study asserted that many organizations lacked awareness of OT cyber risk.

What can companies do?

The energy sector’s leaders and top executives need to take greater responsibility in mitigating the risk of cyber-attacks. CEOs and board members must draw from their decades of expertise in integrating energy assets with OT and leveraging IT networks to reduce cyber risk across their hyperconnected operating environments. For decades, oil and gas companies have pursued productivity gains by researching advanced excavation techniques and by linking physical energy assets with OT control systems and IT networks. That trend continues today with energy organizations seeking big data, artificial intelligence (AI), and automation solutions to reduce costs, improve efficiency and help reduce emissions. Throughout this process, industry executives have also pioneered key management principles and risk-based approaches to securing the technologies and processes that serve as the foundation for their hyperconnected industrial Internet of Things (IoT) business model. To prepare for the new normal of more frequent and sophisticated cyber-attacks on energy and critical infrastructure, energy sector CEOs and corporate board members must take the best practices and key lessons learned from a decade of both successfully addressing and learning from the failures of addressing cyber risk.

Conclusion

Resilience of the oil and gas industry to cyber attacks has a lot of potential to improve going forward. Assessment of IT/OT security should include current risk covering, systems, threats and impacts. Digital workforce in oil refineries can improve field force effectiveness using wearable devices and digital tools, including augmented-reality systems. Regulatory developments in this space can assist in making oil and gas companies more aware of cyber attack risks, however the industry has a long way to go in its quest to become technologically resilient!

© K999 Engineering & Construction Co. Ltd. 2023