Cybersecurity Risks in Smart Factories: A Wake-Up Call for Industrial IoT

Quick Take

— Industrial IoT (IIoT) has never been attacked as much as it is today — barnacles know factories can’t accommodate downtime.

— Smart factory attacks don’t just lead to production halts but to scroll-throughs of entire supply chains.

Most IIoT devices were never designed for security — trying to retrofit them is a nightmare.

Zero Trust is no longer optional just because. If you’re not segmenting networks on your factory floor, you’re already a target.

— Attackers are not just script kiddies—nation-states and ransomware gangs are all getting in on IIoT hacks.

I won’t pull any punches — IIoT security is an afterthought. And the bad guys know it.

Introduction

I have been doing this for decades, from networking voice and data over PSTN to dealing with the Slammer worm in real-time. Back then, takeovers were more akin to vandalism—now, attacks on industrial environments can mean multimillion losses.

I was called in a panic last month by a manufacturing client. The assembly line came to a stop, midproduction, and their IIoT monitoring system was churning out garbage data. In a few hours, they put their whole supply chain at risk. It had been an access point for a sophisticated attack, courtesy of an unpatched IIoT device.

The adoption of IIoT is on the rise—and so are the attacks. Connected sensors, robotic systems, and cloud-integrated devices streamline production at smart factories. But that creates a huge problem: Most of these devices were designed for efficiency, not security.

For attackers? That’s an open door.

Key IIoT Threats

Let’s deal with the actual dangers. If your factory is connected, these threats are real, not theoretical:

1. Industrial Control System (ICS) Ransomware

• Attackers are no longer content to lock up IT systems — industrial machinery is now fair game.
• Ransomware hitting SCADA (Supervisory Control and Data Acquisition) systems means factories halt.
• Then there are some incidents that lead back to nation-state actors—this isn’t amateur hackers nonsense anymore.

2. Supply Chain Manipulation

• Because IIoT devices are used at factories, if hackers manage to compromise the device, they can disrupt the production process without being concluded, which can ultimately lead to defective products.
• Attackers don’t always seek instant pandemonium. Over the long term, sabotage is on the rise.
• Consider automotive production and what one failed sensor might look like at scale.

3. Attacks on IIoT Networks—Man-in-the-Middle (MITM)

• There is no encryption between IIoT devices and control systems, allowing attackers to intercept traffic.
• Attackers can inject commands, impersonate status messages, or tamper with sensor data.

4. Abuse of Legacy Protocols

• Many factories use inherently insecure protocols such as MODBUS and DNP3, and unpatched TCP/IP stacks.
• Security was not even a thought when these protocols were created.

5. Remote Access Exploits

• Default credentials are still shockingly prevalent on many IIoT interfaces.
• Just by having one valid VPN credential on their side, attackers can bypass ICS security layers.

Attacks on Industrial IoT — The Real World

Colonial Pipeline and Industrial Disruption

Remember May 2021? A ransomware attack halted a whole energy pipeline and triggered a fuel crunch. That was not even a tailored ICS assault — it took advantage of a lone VPN credential.

Now envision that same attack hitting a smart factory instead. Or a semiconductor fab. The consequences would not only be financial loss — it would mess up everything downstream.

Triton Malware and Industrial Sabotage

Triton (or TRISIS) targeted SIS devices specifically designed to protect critical infrastructure. Let that sink in — this malware was designed to override safety mechanisms.

If your IIoT devices operate power grids or the safety systems of factories, a similar attack could mean disaster.

Defensive Mechanisms: How Do We Fight Back?

It’s not hopeless. But it takes a serious investment in security-first architectures. Here’s what actually works:

1. Zero Trust for IIoT Networks

• No trust by default in an industrial network. Authenticate every device and every request.
• Microsegmentation of OT and IT networks is a must-have.
• Most IIoT devices should not require direct Internet connectivity, so they should have least privilege access.

2. Use Strong Authentication, Remove Default Credentials

• Hardcoded passwords remain a huge problem. Replace them immediately.
• If IIoT admin panels still have password-only authentication, add hardware authentication (e.g., YubiKeys, smartcards).

3. Monitor Network Behavior

• Network behavior analysis tools monitor anomalies in IIoT traffic.
• Correlate IT and OT attack patterns through SIEM/SOC integration.
• If you don’t already have intrusion detection for industrial control systems, implement it.

4. Patch Management

• Many ICS/IIoT devices remain unpatched for long periods of time due to costly downtime.
• Implement a dedicated patch schedule incorporating maintenance windows.

5. Air-Gapping Where Possible

• Physically isolate a system if it doesn’t require internet connectivity or use an industrial data diode for one-way data flow.

Caution: Knowledge is Power for Engineers & Operators

IIoT cannot be defended by the security teams alone. Engineers and operators need training on how to spot security risks.

What’s Next in IIoT Security

Honestly? My eyes roll when vendors put “AI-powered” on their security solutions. But there’s some encouraging news:

1. Secure IIoT Devices with Hardware

• Hardware encryption is increasingly integrated into industrial controllers.
• Trusted Platform Modules (TPM) and Secure Boot are emerging for IIoT endpoints.

2. Real-Time Threat Detection with Edge Computing

• Many IIoT deployments place cybersecurity enforcement at the edge, helping to decrease latency for identifying threats.

3. Supply Chain Integrity Using Blockchain

• Although blockchain sounds like a buzzword, it holds potential for guaranteeing an immutable supply chain ledger.

4. Segregated IIoT Networks with SD-WAN & SASE

• Integrating Zero Trust (ZT) access controls for IIoT communications using Secure Access Service Edge (SASE).
• SD-WAN allows for policy-driven traffic segmentation, essential for isolating vulnerable ICS elements.

Final Thoughts

If you do not secure an IIoT environment now, attackers will do it for you — just not the way that you would want.

Availability is critical for manufacturing and infrastructure, but security should never be compromised when achieving availability. I understand, OT security is problematic — devices were not designed with a modern security paradigm. But the alternative? Ransomware groups locking up entire production lines or nation-state actors going undetected for months.

We’re at an inflection point. There is no longer any ignoring IIoT security. If you’re not segmenting networks and deploying Zero Trust, do that now. Because the attackers are not going to wait.