Undergoing a digital transformation is necessary for many manufacturing businesses, especially when they must stay competitive in challenging market conditions. However, if the responsible parties rush things, they’ll increase the likelihood of several security risks. Knowing about those threats helps people become proactive and reduces the chances of digital transformation failures.

1. Data Breaches

Data breaches are significant security risks that can hurt a manufacturer’s bottom line, cause reputation-related damage and result in massive, prolonged operational disruptions. These events can occur in a couple of main ways during a digital transformation. Employees might mishandle information during the transition. Alternatively, hackers could infiltrate networks while security professionals are more distracted. 

Research from 2023 highlighted some of the reasons it’s so important to take necessary safeguards against data breaches. It revealed the average cost is $4.45 million, representing an all-time high and a 15% rise in the past three years.

Additionally, 95% of studied organizations reported they’d experienced more than one data breach. When such incidents happened, 51% increased their security investments, but 57% passed the data breach costs to consumers.

Another problematic takeaway was that hackers disclosed the security breaches in 27% of cases, suggesting organizations lack adequate oversight of their digital infrastructures. Such incidents cost an average of nearly $1 million more than those found by the affected company’s security teams.

One of the best ways to reduce the data breaches that could contribute to digital transformation failures is to identify the most prominent weaknesses that could become entry points for hackers. Then, security professionals should develop comprehensive plans to increase preventive measures during and after the process.

2. Reduced Visibility

Suppose the digital transformation involves using more IoT devices or other connected products. In that case, it can become challenging for cybersecurity teams to have the necessary visibility and control of those devices.

Outdated software is one of the biggest security threats associated with connected products. Manufacturers that rush to be among the first to offer high-tech products may not conduct thorough security testing. In those cases, consumers are often the ones who find the problems. However, many security experts probe for problems after those items reach the market. They report vulnerabilities, hoping the information will prompt quick fixes.

Manufacturers typically address security issues by having development teams release patches. However, employee devices with old software put the whole network at risk. The same is true when companies use computers running old, unsupported operating systems. Hackers target known weaknesses, using them as entry points for wreaking havoc.

A 2023 survey of technology executives in the United States indicated that 51% had not noticed that digital transformations resulted in better profitability or performance. Interestingly, another finding from the survey was that security or regulatory concerns were the top reasons to move ahead with a digital transformation, cited by 56% of respondents.

However, 63% of those polled agreed risk management in the early stages was the biggest contributor to digital transformation success. They used control and security by design to achieve their goals.

In the case of visibility, that could mean having a dashboard that shows all connected devices and their attributes. Businesses may also use tools that recognize when new items appear on the network. Another possibility is to have security professionals confirm all products used on the company network meet minimum standards.

3. Insider Threats

Insider threats can also become more common during digital transformation projects. Such instances do not necessarily involve workers acting maliciously. Sometimes, employees fall for phishing threats, inadvertently providing login details that allow hackers to enter the network and cause damage.

Digital transformation failures partially caused by insider threats can also happen if workers feel overwhelmed during the company transition because it’s happening so fast. Increased workloads or a belief their supervisors don’t listen to their concerns could make people so frustrated that they try to sabotage things.  

Employees unhappy enough to leave an organization may try to take files with them. Those actions could lead to data breaches or eroded confidentiality.

Keeping employees involved in all parts of the digital transformation is essential. Workers must also feel heard when they bring up concerns or issues encountered during the process. They’ll be more likely to stay accountable for their actions when they understand tight security is a collective responsibility.

4. Poor Configuration Management

Configuration management can also fall short during digital transformations, making it easier for malicious parties to find entry points. A 2022 study linked 80% of ransomware attacks to configuration mistakes.

Relatedly, the results of a 2023 cloud security study showed misconfigurations affected 59% of those polled. That emphasizes how easily a misconfigured tool or app could lead to digital transformation failures. It’s also particularly worrisome since cloud computing is typically a major factor in executives’ plans to improve their organizations.

However, people can reduce those risks with specialized tools to detect and flag potential configuration mistakes. Most of those are at least partially automated, which can save time for busy security teams.

Additionally, implementing a strict change management plan minimizes errors. One of the easiest and most effective approaches is to create and maintain logs confirming the person responsible for a configuration. Having someone else check that individual’s work can significantly reduce mistakes that could cause security problems.

5. Vendor-Related Risks

Security risks can also come from customers not thoroughly vetting vendors and ensuring they follow cybersecurity best practices. In one digital transformation study, participants answered a question about how they’d meet security requirements while moving from data centers to edge computing.

Only 42% said their current security vendors met their needs during 2022 digital transformations. That suggests most participants should work with new companies. However, vetting providers takes time and dedicated effort. Rushing a digital transformation probably won’t allow for ensuring service providers won’t introduce new threats.

People must allow enough time to get into deep discussions with vendors about how they reduce risks. Security professionals should ask about data-handling procedures, access management and other central topics that will reveal a company’s cybersecurity practices and priorities.

It’s also wise to set and track security-related metrics. Then, vendors will know there are performance-related objectives that they must meet to maintain the business relationship.

Avoid Security-Related Digital Transformation Failures

Even the most well-planned digital transformations may fail. However, that outcome is less likely when people know and are prepared to mitigate some top security risks. Shortcomings also become more severe if individuals rush through their plans. Executives must curb their overeagerness, realizing they’ll get better results by taking their time to do things carefully and correctly.