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C-SCRM (Cybersecurity Supply Chain Risk Management)

Reviewed by Margaret RouseCheckmark | Last updated: May 16, 2022

What Does C-SCRM (Cybersecurity Supply Chain Risk Management) Mean?

Cybersecurity Supply Chain Risk Management (C-SCRM) is a systematic process for managing exposure to cybersecurity risks throughout the supply chain. An important goal of C-SCRM is to reduce the likelihood of a supply chain compromise by a cybersecurity threat by improving an enterprise’s ability to effectively detect, respond and recover from disruptions should a C-SCRM compromise occur.

Supply chain risk includes vulnerabilities introduced by third-party cloud services, as well as risks passed down from the cloud provider's own supply chains. Managing SCRM risk successfully requires some level of visibility into how the provider's services are developed and what standards and best practices the third-party vendor followed to ensure the security of their own products and services.

Vulnerabilities in the supply chain are often interconnected and can expose enterprises to additional downstream cybersecurity risks. To mitigate SCRM cyber risks in the United States, Executive Order #14028 mandates the use of enhanced contracting requirements and guidance that will hold vendors accountable for assessing the risk of their supply channels.

In the enterprise, C-SCRM affects a wide array of corporate departments, including information technology, privacy and compliance, acquisition and procurement, human resource management (HRM) and legal teams. From a governance perspective, C-SCRM initiatives should be an enterprise-wide -- regardless of the specific enterprise structure -- and acquisition processes should include considerations for C-SCRM in each step of the contract management life cycle (CMLC).

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Techopedia Explains C-SCRM (Cybersecurity Supply Chain Risk Management)

In information technology (IT), supply chain risks include the purchase of counterfeit software, the insertion of malicious functionalities into legitimate software applications and the introduction of vulnerabilities by improper development practices within the supply chain.

BENEFITS OF C-SCRM

C-SCRM reduces the likelihood of supply chain compromise by enhancing an enterprise’s ability to effectively detect, respond, and recover from events that result in significant business disruptions.

An enterprise’s overall approach to C-SCRM governance should balance exposure to cybersecurity risks throughout the supply chain with the costs and benefits of implementing C-SCRM practices and controls.

How to Implement C-SCRM

The first step of C-SCRM governance is to identify potential risks, with the understanding that some risks will be integral to the pursuit of value. Additional best practices for managing C-SCRM include the following:

  1. Document the entire enterprise’s supply chain.
  2. Establish a formal, enterprise-wide governance plan for cybersecurity risk management.
  3. Identify critical suppliers.
  4. Ensure critical suppliers are included in the organization’s cybersecurity risk management activities.
  5. Update C-SCRM governance guidelines on a continuous basis.

Evaluating C-SCRM Governance

Enterprises can use several methods to measure and manage the effectiveness of their C-SCRM program. One popular methodology is to adopt the NIST framework for C-SCRM and use a maturity model to assess the progress of C-SCRM policies toward desired outcomes. Maturity models for C-SCRM should be based on the uniqueness of an organization’s business and its mission, as well as the organization's compliance requirements, risk appetite and risk tolerance.

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