Cyber Supply Chain Security: A Cost Benefit Analysis Using Net Present Value

Cyber supply chain (CSC) security cost effectiveness should be the first and foremost decision to consider when integrating various networks in supplier inbound and outbound chains. CSC systems integrate different organizational network systems nodes such as SMEs and third-party vendors for business processes, information flows, and delivery channels. Adversaries are deploying various attacks such as RAT and Island-hopping attacks to penetrate, infiltrate, manipulate and change delivery channels. However, most businesses fail to invest adequately in security and do not consider analyzing the long term benefits of that to monitor and audit third party networks. Thus, making cost benefit analysis the most overriding factor. The paper explores the cost-benefit analysis of investing in cyber supply chain security to improve security. The contribution of the paper is threefold. First, we consider the various existing cybersecurity investments and the supply chain environment to determine their impact. Secondly, we use the NPV method to appraise the return on investment over a period of time. The approach considers other methods such as the Payback Period and Internal Rate of Return to analyze the investment appraisal decisions. Finally, we propose investment options that ensure CSC security performance investment appraisal, ROI, and business continuity. Our results show that NVP can be used for cost-benefit analysis and to appraise CSC system security to ensure business continuity planning and impact assessment.