What are Joe Biden’s plans for US supply chain reform?
Joe Biden was this week sworn in as the 46th President of the United States in a socially distanced, fully-masked ceremony marking the start of the post-Trump era.
Just hours after entering office, Biden set to work reversing many of his predecessor’s policies, including the Trump administration’s handling of climate change and immigration. There will be many more changes to follow, including a promised overhaul in the administration’s approach to the US supply chain. Leading up to the election and eventual triumph over his GOP rival, Biden pledged to back the US supply chain and enact sweeping changes to “ensure that the US does not face shortages of the critical products America needs in times of crisis”.
Stability, capacity and growth
In a document titled “The Biden Plan to Rebuild US Supply Chains and Ensure The US Does Not Face Future Shortages of Critical Equipment” - a gossamer-thin jab at Trump’s failed COVID-19 policies - Biden laid out three pillars that will underpin his supply chain reform. They are:
• Use the full power of the federal government to rebuild US domestic manufacturing capacity of our supply chains for critical products
• Implement a comprehensive approach to ensure the US has the critical supplies it needs for future crises and its national security
• Work with allies to protect their supply chains and to open new markets to US exports
Primarily, Biden aims to shield the US supply chain from risk and reverse an import-first system that could leave the nation vulnerable in the longterm.
“While medical supplies and equipment are our most pressing and urgent needs, US supply chain risks are not limited to these items. The US needs to close supply chain vulnerabilities across a range of critical products on which the U.S. is dangerously dependent on foreign suppliers,” the document says.
Supply chain overhaul will be top of Biden’s agenda in light of the COVID-19 pandemic. On 21 January, the President signed an executive order to "urgently a nd effectively" address shortfalls in COVID-19 response and engage multiple federal agencies in a 180 day project to develop a “strategy to design, build, and sustain a long-term capability in the United States to manufacture supplies for future pandemics and biological threats”.
Through the Defense Production Act (DPA), Biden is also expected to increase jobs in domestic manufacturing of ‘critical products’, particularly those pertaining to COVID-19 response. His commitment promises to “use the full power of the Federal Government to rebuild domestic manufacturing capacity in our critical supply chains”.
Biden’s longterm vision
Beyond the immediate supply chain requirements to tackle the pandemic, Biden has also pledged to undertake “an ongoing, comprehensive government-wide process to monitor supply chain vulnerabilities, designate vitals products where the US needs to address supply chain vulnerabilities, and immediately close identified gaps”.
The process will include close collaboration with the private sector to avoid red tape and unnecessary government spend.
Biden’s Supply Chain Intentions Depend on Cybersecurity
In recent years, the United States’ supply chain network has faced an onslaught of cyberattacks. The attacks have left the global superpower a shaking nation with a whole portfolio of challenges, risks, and vulnerabilities exposed to the masses. From the attack to the that breached companies like Apple, Microsoft, Uber, and Tesla, to the most recent , it’s evident that, in an increasingly digital age, cybercriminals fear no traditional governmental powers, and supply chain networks need to hunker down on cybersecurity.
Looking back at the height of the COVID-19 pandemic, western nations found themselves ill-equipped to deal with the novel Coronavirus; not due to lack of knowledge or medical inability but because supply chains were in a chokehold and supplies like personal protective equipment (PPE) for frontline workers weren’t being manufactured fast enough.
The Executive Order (EO) of US supply chains to figure out exactly where the vulnerabilities and risks are, to help institutions and organisations manage any future disruption caused by COVID-like events.
The EO focuses on six primary sectors:
- Communications and information technology
- Defence industrial base (DIB)
- Energy and power
- Public health
The listed sectors, as you might expect, are increasingly dependent on digital products and services to maintain daily operations, which increases their vulnerability to potential attacks ─ so they need cybersecurity. In fact, cybersecurity should be front-and-centre as a critical facet of the EO if the federal government truly intends to create a more robust and resilient supply chain in the face of rising criminal adversity.
Digitisation Dangers The Nation
When it comes to a globally interconnected supply chain, the ambitions of Biden’s administration are potentially a little far-fetched and off-the-mark, in reality. I say that because an overwhelming number of industry-leading organisations ─ even in the tech realm ─ still do not feel confident in their ability to deal with the vulnerabilities in their supply chain. Most of which come not from internal operations but from externals ones in the form of third parties and suppliers that they collaborate with.
According to the dated but increasingly relevant Marsh Microsoft introduction, “cyber risk has moved beyond data breaches and privacy concerns to sophisticated schemes that can disrupt entire businesses, industries, supply chains, and nations, costing the economy billions of dollars and affecting companies in every sector. The hard truth organisations must face is that cyber risk can be mitigated, managed, and recovered from, but it cannot be eliminated.”
Taking a look at the survey results reveals a telling tale: that third-party providers and supply chain operations external to an organisation are most likely to be the victim of cyberattacks and potential infiltration.
The survey found a wide discrepancy in many organisations’ view of the cyber risk faced by supply chain partners, compared to the level of perceived risk they themselves pose:
This variance is consistent across industry sectors and geographic regions, and the largest organisations exhibited the largest dissonance: 61% of companies with revenues of US$5bn or more suggested that their supply chain partners pose a risk, whereas only 19% say they themselves pose a risk to the third-parties involved:
Low Confidence in 3rd-Party Risk Mitigation Capabilities
The above paints a pretty poor picture of the overall supply chain security ─ a disconnect between large organisations and their suppliers, which could be driven by companies’ low confidence in their ability to mitigate cyber risks posed by their commercial partners. The number of companies that considered themselves “highly confident” in that area is few and far between, with only 5-15% of respondents feeling prepared to deal with the cyber risks caused by certain types of third-party providers.
So due to the very obvious lack of knowledge, it’s clear that supply chain professionals and organisations, as well as the Biden administration, should call upon their cybersecurity industry peers ─ ─ to take the fight to black hat cybercriminals.
How Cybersecurity Professionals Can Help
According to Padraic O’Reilly, CPO and Co-Founder of CyberSaint, the success of Biden’s Executive Order is heavily dependent on its stakeholders taking note of lessons from cybersecurity’s supply chain risk management initiatives, including:
- Identifying the main weaknesses along the chain of production before determining which ones can be fixed cost-effectively. Then, compare that with the cost of the potential impact ─ discover where the holes are and what’s worth prioritising.
- Thinking about the supply chain as a cybersecurity practitioner does. Cyber-risk is all about making sense of multiple data sources, and supply chain risk is the same. Don’t think about the supply chain as a single entity; rather, consider it as many entities that produce data ripe for deep risk analysis.
- Standardisation across the globally interconnected supply chain is hard, and communication is key. Cyber experts are hot on the topic, as managing risk is exactly what they do. Vulnerabilities and risk is the language that they speak in. They’ve been dealing with supply chain security for years before disruptions at the scale of COVID-19 came about.
Cross-sector collaboration with a strong focus on communication across hierarchical levels is at the very core of the cybersecurity function. If Biden hopes to see his supply chain initiative reign triumphant, his administration must ensure that efforts are coordinated across agencies, public entities, and the private sector industry. The administration must also carefully consider the potential impact of increased regulation that should be put in place following the year-long project ─ it could make or break the initiative across various sectors.
According to O’Reilly:
“The best choice is to rely on standards, measurement, and cross-industry collaboration to make this happen. Other supply chain standards, such as the (CMMC), can serve as models for a data-driven approach.
Without these considerations, we risk a lot of duplicative time, effort, and analysis, only to fail to mitigate cyber-risks and possibly result in yet another supply chain attack. We hope stakeholders will engage the information security community to bolster this project. Leveraging existing analysis by the information security community will matter to its success.”
Adapting To The Unknown
The fact of the matter is, when it comes to the US supply chain, we mostly haven’t got a clue. It’s a massively interconnected network that represents an ecosystem ─ one with risks coming from all angles and multiple points of failure. It’d be almost impossible to figure out all of the potential risks, as Biden’s initiative intends, so, according to O’Reilly, it’d be beneficial to focus not on sniffing out every single supply chain vulnerability but on advanced persistent threat (APT) incentives:
- What are the low-hanging targets?
- What do criminals want?
- What are they capable of?
“Doing some scenario modelling and talking in probabilities could lead to more informed decisions regarding mitigating risk. NIST 800-30 and the are examples of risk-quantification methods that aim to translate cybersecurity risk into dollars and cents. Understanding supply chain risk requires measurement, strong governance, input from security experts, information sharing, and advances in cyber and IT risk-management software. Instead of logging an APT's activity, start getting a fact pattern about where they may be going”, O’Reilly adds.
So the final point to the Biden administration and organisations that are working on is clear: cybersecurity professionals have an advantage over their peers because they already live to standardise data; they view risk through a lense of complexity and costliness of failure, and if the two parties can collaborate effectively, there’s a chance that security professionals can finally understand the full extent of the supply chain ecosystem and, with any luck, secure it from future attacks.