Implications for Cyber Leaders When Attacks Impact Other Businesses
The recent cyberattack on CDK Global, a company providing services to car dealers, offers valuable lessons for cyber leaders, especially when such an attack impacts other businesses that rely on their services. This incident has led to significant business losses, legal actions, and raised questions about the adequacy of data security measures.
Understanding the Attack:
In June, CDK Global experienced a cyberattack that crippled both the company and thousands of dealerships across the country. The attack lasted from June 19th to July 15th, causing significant disruption and financial loss. Various businesses have filed class action lawsuits against CDK, claiming negligence and inadequate data security measures.
Impacts on Dependent Businesses:
The attack on CDK Global severely affected businesses that depended on their services. For instance, Manderbach Ford in Pennsylvania had to revert to pen and paper for transactions and was unable to access certain rebates and incentives. DLR Auto Group in California couldn’t conduct business for three weeks. These disruptions highlight how a single point of failure can have widespread repercussions.
Legal Repercussions:
The lawsuits against CDK Global emphasize the need for robust data security measures. The class action lawsuit claims that CDK’s failure to maintain adequate data security led to the data breach and the subsequent business losses. This legal action underscores the importance of accountability and the potential financial and reputational damage that can arise from inadequate cybersecurity.
Lessons for Cyber Leaders:
Relying on a Single Vendor: The CDK incident illustrates the risks associated with relying on a single vendor. Cyber leaders must evaluate the potential impact of vendor-related disruptions on their operations and consider strategies to mitigate these risks.
Vendor Management Programs: Implementing robust vendor management programs is crucial. Regularly assessing vendors’ cybersecurity practices, ensuring compliance with industry standards, and establishing clear incident response protocols can help mitigate risks associated with third-party vendors.
Secondary and Tertiary Backup Vendors: Having backup vendors in place can provide a safety net in case of disruptions. By diversifying the vendor base and having contingency plans, businesses can minimize the impact of vendor-related cyber incidents.
Proactive Measures:
Regular Security Audits: Conducting regular security audits of vendors can identify potential vulnerabilities and ensure that they adhere to stringent cybersecurity standards.
Incident Response Planning: Developing and testing comprehensive incident response plans can help businesses respond quickly and effectively to cyber incidents. These plans should include clear communication protocols with vendors and stakeholders.
Employee Training: Ensuring that employees are trained in cybersecurity best practices can reduce the risk of breaches. Regular training sessions can keep employees informed about the latest threats and how to respond to them.
The cyberattack on CDK Global serves as a stark reminder of the potential fallout from vendor-related cybersecurity incidents. Cyber leaders must prioritize robust vendor management programs, diversify their vendor base, and implement proactive measures to mitigate risks. By doing so, they can protect their organizations and the businesses that rely on them from the devastating impacts of cyberattacks.
