Shabnam Pervez is a thematic analyst at GlobalData. She has been working on the thematic team for over three years, focusing on emerging technology trends in a myriad of different sectors.
Lara Virrey: What are the biggest cybersecurity challenges facing packaging companies today?
Shabnam Pervez: Major cybersecurity challenges within the packaging industry arise from digitalisation. Like other sectors, technology is disrupting the packaging industry. Various technologies can be integrated throughout the value chain to automate processes and gain better insights into customer behaviour. However, understanding and effectively utilising these technologies pose a significant challenge for packaging industry players who are under pressure to keep up with the rapidly changing technological landscape.
Additionally, the future of work presents another challenge as employment dynamics shift. Many businesses are experimenting with hybrid and flexible work strategies, enabled by collaboration tools and cloud computing. These technologies allow employees to work remotely, reducing travel expenses and improving work-life balance. This shift also allows companies to downsize office spaces, lowering real estate costs. However, transitioning to remote and hybrid work models introduces new security challenges as corporate IT has less control over user actions, devices, and software. The Covid-19 pandemic has further accelerated the trend of remote servicing of packaging machinery.
Lastly, businesses across all sectors face the issue of Environmental, Social, and Governance (ESG) considerations. Investors, governments, employees, and customers share the common goal of becoming more sustainable. Companies that prioritise sustainability will reap financial benefits, such as increased share prices and improved customer and partner loyalty. On the other hand, those that neglect sustainability will struggle. In the packaging industry, companies face mounting pressure to use environmentally friendly packaging materials, reduce single-use plastics, and address their carbon emissions. Government regulations, like the UK’s Circular Economy Package, dictate sustainability standards favouring recycling and the circular economy. However, ESG encompasses more than just environmental aspects; companies also have a responsibility to care for their customers and employees while ensuring robust corporate governance structures.
Lara Virrey: How can packaging companies best defend themselves against cyber threats?
Shabnam Pervez: Packaging companies should prioritise cybersecurity across their entire value chain. As the packaging industry undergoes digital transformation, companies at every stage of the value chain are recognising the vulnerabilities present in their supply chains. To address these concerns, they are collaborating with cybersecurity firms to find solutions. Investments in cybersecurity for the packaging industry should focus on essential areas such as threat detection and response, cloud security, data security, vulnerability management, post-breach response services, and risk and compliance. With the increasing use of cloud servers for delivery management and the storage of large amounts of virtual data, packaging companies face the risk of supply chain sabotage if they fail to implement effective cybersecurity measures.
Lara Virrey: How has the nature of cybersecurity threats to the packaging industry changed in the past two to three years?
Shabnam Pervez: The manufacturing sector is undergoing rapid digitalisation. According to a survey conducted by the Packaging Machinery Manufacturers Institute (PMMI) in March 2021, approximately 79% of companies have integrated smart technologies into their processing lines, 64% on their assembly lines, and 60% at the end-of-line packaging stage. These numbers are expected to significantly rise as the industry continues to explore and adopt new technologies.
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Lara Virrey: Are packaging companies doing enough to protect themselves against cyber threats?
Shabnam Pervez: Certainly not – as per IBM, the manufacturing industry is the second most targeted sector by cybercriminals, yet it remains one of the least prepared. The packaging process, which often occurs as the final step in manufacturing, relies heavily on automated machinery, accounting for approximately 60% of end-of-line packaging. The Packaging Machinery Manufacturers Institute (PMMI) reports that in 2020, a staggering 88% of small business owners in the manufacturing sector felt their businesses were susceptible to cyberattacks. Furthermore, 28% of all cybersecurity breaches targeted small businesses, and a distressing 10% of these small businesses were forced to permanently close their doors as a result of such breaches. Consequently, small packaging companies must prioritise the implementation of suitable cybersecurity measures wherever feasible, given their heightened vulnerability as frequent targets of attacks.