00:00Ben Farrell is CEO of the Chartered Institute of Procurement and Supply.
00:05Great to have you on the programme.
00:08Let's start by talking about the impact that this prolonged cyber attack has had,
00:12not just on JLR, but on its supply chain.
00:16Lots of small businesses being hit hard, right?
00:20Yes, there are.
00:21And I think it's worth just describing a little bit of the context.
00:23And for JLR, as an organisation, it employs 34,000 people in the UK across the three plants that are impacted.
00:33But the wider supply chain base or the supply base in the UK, there are about 120,000 people
00:40and obviously dozens and dozens, approximately 700 different businesses that have been impacted.
00:47And this is showing up, as you can imagine, in lots of different ways, given that they haven't actually manufactured.
00:52What would have otherwise been typically 100,000 vehicles per day routinely.
00:58So since the 1st of September, that hasn't happened.
01:01And having visited their plants, I can tell you that it's incredibly precise in terms of the manufacturing operations.
01:07It's not that they can, you know, park up spares and have a big warehouse waiting for just such an occasion like this.
01:15It's actually, you know, almost minute by minute how it's all brought together and manufactured.
01:20So it's been a really profound impact in about, I think, as you, of course, I mentioned that 50 to 70 million pounds hit on them per week as an organisation.
01:32On top of the impact that you'll have perhaps noted earlier this year with the tariffs.
01:37And I saw that their sales had dropped about 11 percent in July on the back of the uncertainty around tariffs.
01:43So hard yards for JLR and their supply chain this year.
01:47Well, the UK government is guaranteeing around two billion dollars in a loan.
01:53Some are calling it a bailout.
01:56It's what you're talking about, the size of this and the size of the supply chain, the reason why maybe it's too big to fail.
02:02Well, I think I think in a way that it sort of almost sounds slightly derogatory that it would be be a bailout.
02:09But it's entirely, you know, my view, a pragmatic position.
02:12There's a great deal of people employed in what is actually a very prestigious manufacturing in the United States,
02:19the UK's biggest automotive manufacturer of prestige vehicles.
02:22And clearly that the government will want to intervene to protect that vital economic supply base,
02:30particularly in areas like the West Midlands, where an awful lot of people are employed there.
02:36So, you know, they've intervened pretty swiftly in order to provide JLR with a mechanism to sustain its supply base as it sort of gets going again.
02:48But clearly there are some lessons to be learned in terms of, you know, cyber resilience and that type of thing as we go forward.
02:55Well, you talk about that cyber resilience.
02:57Jaguar and Iron Rove are not the only British firm to be hit by these cyber attacks, to be thwarted by them.
03:03Harrods, Co-op, Marks and Spencer.
03:06So what can companies do to bolster themselves, to make them impenetrable?
03:11Well, I've seen a number of things this year, not just in the UK, but wider across the globe,
03:18where the advances in AI have allowed more and more manufacturers to truly understand the breadth and depth of their supply chain.
03:28So my advice is really get to grips with what your supply chain looks like in the sense of not just the physical supply chain,
03:36but people who are providing goods and services in some digital way to you,
03:41because typically these large organizations aren't necessarily being attacked themselves,
03:45but people are finding roots into them through their suppliers.
03:49So you've got to look at this in the round and start really protecting yourself.
03:53And of course, this is almost a constant battle in as much as you, as soon as you've got a protective measure,
03:59there's somebody who's invented a way to get around it.
04:01So it is almost a new paradigm.
04:03We're living in a different world, the tectonic plates of global trade have shifted,
04:09the nature of trading in the digital world under different approach.
04:14And I think that is, you know, really the big lesson.
04:17And it's not that new as a lesson, I have to say, that's emerging, you know, recently.
04:21It's not that we're having a new conversation about cyber risk, really, is it?
04:25It's actually about people being really diligent and understanding their environment and protecting it properly.
04:30I was going to say, Ben, we've been talking about cyber resilience for nearly 20 years.
04:35Ben Farrell, CEO of the Chaston Institute of Procurement Supply. Thank you.
