It was shocking news when Maersk announced that it had been the victim of the recent hacker attack that affected many commercial and noncommercial organizations across the globe. One might have assumed that one of the biggest shippers in the world would have all the necessary firewalls in order to curb this sort of intrusion. At the same time, the thinking was that if such a big company could be successfully infiltrated, what about the smaller players in the industry? As it happens, the industry was significantly affected by the fallout of the attack on the Maersk technology systems.
Processing Issues and Bottlenecks
Maersk could not easily process some of its orders, and that had a knock-on effect on virtually all the suppliers and consumers within its chain. As one of the leading shippers in the world, the tentacles of the Maersk network spread far and wide. It is a multiple trader in many countries and is a valued member of the shipping community. The Petya cyber-attack served to demonstrate the contagion that is possible when such things happen. As the industry has become more integrated, the risks of contagion have actually spread. You only have to attack a big player like Maersk before everything comes tumbling down.
The figures and reports certainly bear out this conclusion. There were reported delays in at least 76 port runs. The APM terminals were significantly affected. The nations that were covered in the contagion include Spain, the USA, the Netherlands, and even India. Vincent Clerc, who is the senior commercial officer for Maersk, had this to say:
“It will have an impact on vessels or cargo that loaded yesterday, today and maybe also tomorrow…”
The implication is that there will be an effect, but Maersk has some resources and contingency plans that might somehow mitigate the worst effects of the attack. It must be noted that Maersk is responsible for processing 1 in every 7 of containers that travel worldwide. That means that its debilitation by the cyber-attack is necessarily an issue for the industry as a whole. This is not a situation where the problem is localized and can be easily contained within the remits of the arms of the organization or company. As the attack progressed, Maersk made a strategic decision to take down some of its systems in order to reduce their vulnerability. Of course, this also had the effect of ensuring that there would be more delays for people that relied on those networks that had been temporarily suspended.
The good news is that Maersk has a recovery plan that will see the operations go back to their normal efficiency. The costs of the attack will continue to be counted as people take stock of what was missed and what was lost during those days of panic and uncertainty. There were some alternative channels for those that had already booked their transactions. In some instances, the orders were taken manually in order to reduce the risk of falling prey to the hack.
What about the Key Data?
Early indications are that no significant data was lost during the process. Indeed, there were reassurances that the company would be able to operate at its usual capacity in a relatively short period of time. However, there would necessarily be a period in which some of the outstanding issues would have to be resolved in order to get back to parity. The economic impact can be hard to judge, particularly in the early days, but it is very clear that the company had a survival strategy from day one of the crisis.
These are some of the event highlights that give us clues as to the potential impact of this attack:
- The ports in New Jersey and New York were reported closed on Tuesday and Wednesday.
- The Aarhus container terminal in Denmark opted to use certain alternatives when access to its APM terminal systems were affected.
- There were two terminals at Rotterdam that were completely out of commission for about two days.
- The South Florida container tunnel was out of action, and this caused significant delays.
Then, there are the global issues to consider. About 90% of all world trade is transacted via the shipping industry. That means that anything that attacks one of the major players in the industry is going to have far-reaching economic impacts. This is beside the disruption to the operations of the various actors in the industry, where technology is becoming a distinct competitive advantage. Khalid Hashim of Precious Shipping summed it perfectly when he noted the following:
“As Maersk is about 18 percent of all container trade, can you imagine the panic this must be causing in the logistic chain of all those cargo owners all over the world?”
The industry must go into a lessons-learned mode now. There is no way they will have complete control over their cyberspace since hackers are becoming more sophisticated by the day. A much more sensible option is to come up with systems that can withstand these sorts of attacks. It will cost time and money to get there, but get there the industry must. They cannot afford to tolerate or absorb such blatant intrusions over the long run. We are still not even sure how the global trade will respond to the attack.
Once again, Russia is emerging as a cause for concern in terms of cyber security issues. The hackers may be doing to the shipping industry what they did to the Hillary Clinton campaign during the US presidential elections of 2016. As yet, nobody has indicated that they were “patriotic” cyber troops trying to defend their motherland. However, the suspicion in social media is that these attacks are going to continue for a very long period of time. The shipping industry had better be prepared to take all the necessary precautions to ensure that it does not witness the chaos that we have all seen over the past few days.