Lioncroft Wholesale CEO: 'Technology drives us forward, but let's not forget the risks'

Independent

4 hours ago

We all recognise the many, many ways technology enables us to innovate and scale. Virtually every UK business relies upon the latest technologies to keep the wheels of industry turning. Technology is how we manage our systems, process orders, handle data, support our people and communicate with the outside world. Technology is the very backbone of our business, leaving us woefully unprepared for if, and when, things go wrong.
And go wrong they have, in recent weeks. It has been impossible to miss the news headlines screaming loud about cyber attacks which have wreaked havoc on UK household names such as M&S, the Co-op and Harrods, to name just three.
M&S was first struck in April, and as we go to press in June, the business is still in recovery mode with a return to normal not expected until July. Their once-full shelves are now dotted with availability gaps – the ultimate nightmare for a retailer – while their previously booming online sales were brought to an abrupt halt as the company's systems were hacked and disabled. As if this weren't enough, M&S must also brace itself for class action data lawsuits after private data, including millions of customers' household information, telephone numbers and dates of birth, was leaked as a result of the attack.
The impact financially is staggering. The losses to the British high street stalwart look set to be unprecedented – Bank of America Global Research predicted the losses to equate to £43m per week, and estimated to run to more than £400m in total – acting as a harsh wake-up call for every business to think more about the technology it relies upon. And this is without taking into consideration the reputational damage an incident like this can cause.
The PR spin about technology – always on, always working – has made it a business essential. After all, technology never has an off day, it doesn't make mistakes. It doesn't get ill, tired or burnout. It doesn't get distracted from the task at hand by an unscheduled meeting or an unexpected phone call. It completes the task efficiently and accurately, and moves on to the next. Until it doesn't.
So how can it go wrong? Stuart Machin, CEO of M&S, described the security breach as the result of 'social engineering' which came about from 'human error' via a 'third party' although this has yet to be confirmed by the company's internal investigation. In other words, we are the weakest link. We open emails, click on links, share passwords, leave laptops on trains… the list goes on. While it is people that operate the technology, there will always be risks, it is unavoidable.
As M&S continue to repair, the smart businesses will now be using this incident as a learning exercise. Every business, regardless of size and sector, is a potential target, so what can we learn from this? Are we protected? How would we respond? These are the questions we must ask ourselves.
The fact is, when it comes to cyber protection, the work is never done. A constant stream of new threats are defeated by even newer solutions, and protecting your business goes far beyond strong passwords and the latest virus protection. The experts all agree that businesses need multi-layers of protection to secure their systems, combined with insurance.
Are you thinking ahead? We're told that M&S had carried out a cyber attack simulation the previous year and could tap into the learnings from this, responding quickly and effectively. Its business continuity plan kicked in, minimising further damage.
Yes, cyber insurance is essential, but as many business owners have found, it is costly, complex and limited with what it will deliver. Explore the options carefully and with caution.
While we focus on our systems, of course we must also focus on our people. It is our responsibility to equip staff with the knowledge they need to recognise threats and the tactics used by cyberhackers to ensure your business has a culture of security awareness.
There is no doubt that technology is our friend, but let's never forget that it can quickly turn to work against us, as well as for us.
Dr Jason Wouhra OBE is CEO of Lioncroft Wholesale, one of the UK's leading food and drink wholesalers. He is also Chancellor of Aston University and Chair of Unitas Wholesale, the UK's largest wholesale buying group.