BlueScope Steel enhances cyber security after mid-May attack

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BlueScope Steel enhances cyber security after mid-May attack

As it shifts focus on its year-old 'Avenir' digital transformation.

BlueScope Steel says it is making “good progress” on cyber security “enhancements” following a ransomware attack in mid-May.

Chief financial officer Tania Archibald told BlueScope’s FY20 results briefing that the attack, which was first reported by iTnews, had been mitigated without “material” impact on its operations and sales.

“Many of you will be aware that in May we experienced a cyber incident which saw unauthorised parties access our network,” Archibald said.

“As a result of our ability to quickly detect and respond to the incident, we experienced no material impact on our operations and sales. 

“However, the episode did trigger a number of manual processes for a short time, and also highlighted areas where we can enhance our cybersecurity measures, and we've made good progress on these since the incident.”

Archibald did not elaborate, and there was no mention of the attack in the company’s FY20 filings.

The company had not provided an update since confirming a “cyber incident” took place on May 15.

Inside 'Avenir', BlueScope's own digital transformation

BlueScope also provided an update on its digital transformation, which is occurring under a largely-unreported - but year-old - transformation project codenamed ‘Avenir’.

"We are building a technology platform to help our business succeed in a rapidly changing environment. This means replacing several legacy systems with Microsoft Dynamics 365 as our core enterprise resource platform (ERP),” the company said in a job ad last year.

“The project is called ‘Avenir’, and is intended to help our business prepare for future opportunities and customer trends. 

“This a massive change and investment for our business, requiring approximately 1500 end users to change the way they work.”

Managing director and CEO Mark Vassella said today that the company’s digital focus is to provide better customer service while also creating internal operational efficiency.

“We're still struggling under the weight of legacy IT systems that aren't very flexible, or aren't very user friendly,” he said.

“The shift in the Avenir project, which is a base system investment we've been working on for the last year or so, now is really to put us into a position where our customers get much greater transparency and information around where their steel is, where we are in terms of rolling programs, a flexibility to manage their inventories in a much more sophisticated way than we have in the past.

“It's [also about] arming our internal teams with the ability to respond to our customers much more quickly.”

In a slide deck [pdf], BlueScope noted a number of opportunities it saw to employ robotics and automation across its operations, including in its Australian steel division.

This included using algorithms to control the way coatings are applied to steel products, a move into predictive asset maintenance, and the use of digital twins at two sites to “identify potential bottlenecks and assist in the design of interventions”.

Rides data centre boom

Elsewhere in its results, BlueScope said it is riding the growing demand for data centre space and other physical buildings needed to enable e-commerce operations to expand in the wake of COVID.

“As we look to the future, our business is well positioned to address some of the emerging trends post COVID with the localisation of supply chains, a shift towards lower density and regional residential housing, increasing alterations and additions activity, and growth in infrastructure to serve logistics and the digital economy,” Vassella said.

“We know that the digital economy and logistics are taking off and so too the need for quality internet and data centres. 

“Supplying the building products and solutions for the infrastructure that house these industries is a sweet spot for BlueScope.”

Overall, BlueScope Steel reported a net profit after tax (NPAT) of $96.5 million, 90 percent down compared to a year ago.

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