SECURITY: New study gauges readiness for threats

Manufacturing News, Source : The Manufacturer US
Published : 01 Jul 2003 10:29

Security lacking at many facilities

Despite increased terrorism alerts and the realization that the supply chain could be a major terrorist target, a new study shows that manufac-turers are not all that far along in securing their businesses.

According to the report, produced by ARC Advisory Group, 92 percent of respondents say plant security is of the utmost importance. However, only 3.6 percent say their facility is “completely secure,” meaning they are satisfied with precautions taken to protect physical and cyber assets from internal and external attacks.

Thirty-nine percent claim to be “mostly secure,” while 54.8 percent are “partly secure.” However, two-thirds have not adapted any kind of threat assessment methodology.

“My sense is that cyber security is of extremely high importance to plant operations right now, and that a lot of work still needs to be done to make them completely secure,” says Dick Hill, vice president of manufacturing advisory services at ARC Advisory Group. “Physical security seems to be something they have better handle on than cyber security, but yet they aren’t done yet.”

The ARC study states that the majority of respondents expect their security budget to be around two percent of their annual plant budget. Fifty-three percent predict security costs will increase over the next five years, while 37.7 percent say security budgets will remain at current levels.

According to Barry Brandman, president of Midland Park, N.J.-based Danbee Investigations, supply chain theft is pegged at any-where between a $10 and $80 billion business. Exact numbers are hard to come by because so much theft goes unreported.

Danbee Investigations is currently investigating a $1.4 million theft of electronics equipment from a warehouse in the Southeast US. Brandman notes that the manufacturing sector is especially vulnerable to theft, since the theory goes that supply chain fraud or theft is a victimless crime because the victimized company either has the resources to cover the loss, or has insurance to pay for the damages.

However, security specialists say insurance companies are cracking down on theft claims and are beginning to raise rates significantly for repeat offenders. However, the majority of respondents to the ARC study report little or no plans to increase security staffing levels.

“Homeland Security has heightened the awareness of the importance of security, but there is still a bit of a mystery as to what needs to be done,” says Hill. “Part of that mystery is because of the changing threats that keep coming our way.”

The study shows that manufacturers are further along when it comes to implementing fire and safety systems, with 60 percent reporting complete security in that sector. Survey respondent's also report being reasonably comfortable with access control and perimeter security issues.

Full results of the ARC survey will be released this fall.

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