ERP Software for Utilities

The Current State and Key Challenges Affecting ERP Software in the Utilities Industry

Electrical, energy, and waste sectors constitute critical infrastructure, making the underlying IT and operational technology (OT) systems highly attractive targets for cybercriminals seeking to disrupt essential services.

The U.S. government labels the utilities sector as vital, noting that incapacitation or destruction of these systems would have a debilitating effect on national economic security, public health, and safety. This critical infrastructure is a primary target for cybercriminals. Research shows that cyberattacks against energy infrastructure continue to rise exponentially. As the cybersecurity landscape evolves, organizations must take greater efforts to implement specialized ERP security for the utilities industry to secure business-critical systems and reduce risk.

Attacks on utilities yield severe consequences, including power outages, damage to essential networks, stolen personally identifiable information (PII), and billions of dollars lost to ransom demands and repairs. Downtime for utility companies creates detrimental impacts and dramatically disrupts society.

Despite government actions like the Biden Administration’s Executive Order and Binding Operational Directive 22-01, many organizations continue to operate without visibility into the risk associated with their Enterprise Resource Planning (ERP) applications. ERP applications like SAP support the essential business functions of the world’s largest organizations. Over 91% of the top Forbes Global 2000 Utilities run SAP applications. However, CIOs and CISOs often lack specific knowledge of ERP system integrations and the business issues impacted by unprotected application layers.

The current environment requires a shift in enterprise cybersecurity strategies to elevate the protection of SAP applications, ensuring organizations can recover from potential cyberattacks.

How Technology Affects the Utilities Industry

Accelerated digital transformation, complex cloud migrations, and strict regulatory mandates require utilities organizations to adopt specialized cybersecurity strategies to protect their expanding attack surfaces.

Utilities leaders must navigate rapid technological shifts while protecting their organizations from ongoing cyberthreats. Several key technological drivers impact the utilities industry:

Energy and utility companies have rapidly accelerated digital transformation projects to modernize processes and drive efficiency. Many organizations are planning or executing a transformation to SAP’s next-generation ERP, S/4HANA, ahead of the 2027 deadline. This increased interconnectivity between internal and third-party systems exponentially expands the attack surface.

Organizations are migrating from legacy on-premises infrastructure to the cloud to achieve greater resilience. Operating in the cloud allows utilities to scale easily and save hardware costs. By integrating security teams into the migration process, organizations can identify and mitigate system issues prior to deployment.

Utility companies must demonstrate compliance with a vast number of regulations designed to ensure safe utility delivery. Under the North American Electric Reliability Corporation Critical Infrastructure Protection (NERC CIP) standards, companies must adhere to a baseline of security measures. As critical infrastructure providers and publicly traded entities, utilities must also rigorously manage SAP compliance across frameworks like SOX, GDPR, and NIST. Because the threat landscape evolves faster than legislation, utilities require flexible, automated cybersecurity tools.

The US Infrastructure Investment and Jobs Act authorizes $1.2 trillion for infrastructure spending, declaring cybersecurity mandatory for the utilities industry. The act provides resources for cyber coordination and response, which the energy sector must utilize to secure applications by 2026.

Threats to ERP Software

Threat actors increasingly target vulnerable ERP applications within the utilities sector, often exploiting unpatched systems within 72 hours of disclosure to steal sensitive data or deploy ransomware.

The threat landscape for ERP applications has expanded significantly. Advanced threat actors are using common tactics, techniques, and procedures (TTPs) to directly access and attack vulnerable systems. The Onapsis Research Labs found evidence of more than 300 successful exploitation attempts against unsecured SAP applications. Research indicates a window of just 24 hours between the disclosure of a vulnerability and observable scanning by attackers, and just 72 hours before a functional exploit is active.
Organizations frequently rely on a defense-in-depth security model utilizing multiple layers of network security controls. While defense-in-depth is necessary, it is insufficient to protect the modern application layer. Threat actors intentionally target ERP systems because information security teams lack visibility into these complex environments. Once attackers compromise an unprotected SAP system, they can steal employee and customer PII, access financial records, deploy ransomware, and disrupt critical business processes.

Best Practices for Securing ERP Software in the Utilities Industry

Utilities organizations must establish comprehensive landscape visibility, utilize actionable threat intelligence, and automate patch management to effectively secure their business-critical applications.

Securing complex ERP architectures requires a strategic alignment of visibility, intelligence, and automated processes.

Visibility into cloud, on-premises, and hybrid environments allows organizations to properly identify, assess, prioritize, and remediate risk. Enterprises must gain full visibility into all critical systems to eliminate blind spots. Continuous monitoring of these applications ensures vulnerability exploits and anomalous behavior are detected and prioritized before a vendor patch is issued. Implementing DevSecOps ensures everyone in the software development life cycle is responsible for security, preventing vulnerable code from reaching production.

Timely, impactful threat intelligence provides insightful information about current tactics, techniques, and procedures (TTPs) used by advanced persistent threats. Deploying robust threat detection and response capabilities provides early alerts about new ransomware campaigns and delivers actionable data for security teams responsible for designing and implementing application-layer controls.

Automating tasks is critical to managing multiple SAP environments. Patching business-critical applications must remain a high priority to prevent rapid exploitation. Implementing an ERP-focused vulnerability management solution identifies missing patches, validates correct application, and enables organizations to prioritize patching based on severity and business impact. Ensuring systems are protected and patched is also a mandatory prerequisite for secure SAP S/4HANA cloud migrations.

ERP applications process highly regulated financial, customer, and operational data. Failing to comply with utility regulations leads to severe legal and financial penalties. Organizations must achieve automated compliance to efficiently manage these requirements across their complex landscapes. Utilities organizations are subject to numerous government and industry regulations:

  • NERC CIP: Electric companies must identify critical assets, perform risk analysis, and define monitoring policies for the North American power grid.
  • PCI DSS: Utility providers managing large volumes of sensitive customer payment data must maintain strict Payment Card Industry compliance.
  • GDPR: The General Data Protection Regulation requires companies to report data breaches within 72 hours. Fines reach up to €20 million or 4% of global revenue.
  • SOX: The Sarbanes-Oxley Act requires strict internal controls over financial reporting to prevent the manipulation of underlying financial data.
  • FCPA: The Foreign Corrupt Practices Act requires strict application-layer controls to prevent data manipulation related to corporate bribery or fraud schemes.

Getting Started with ERP Software for Utilities Companies

Deploying a dedicated platform for ERP security enables utilities organizations to automate vulnerability management, threat detection, custom code testing, and compliance reporting.

Securing ERP applications requires a unified technological approach. The Onapsis Platform provides comprehensive visibility, robust analytics, and automation capabilities, empowering cross-functional teams to manage risks threatening the security and availability of critical infrastructure.

Comprehensive vulnerability management for ERP applications starts with automated baseline assessments. Solutions like Onapsis Assess provide risk prioritization capabilities and step-by-step remediation instructions. By incorporating context regarding severity and business impact, organizations can efficiently prioritize patching efforts and secure applications before cloud migration.

Threat detection software for ERP applications continuously monitors critical assets across cloud, hybrid, and on-premises environments. Onapsis Defend leverages threat intelligence-based alerts to detect unauthorized changes, misuse, and active cyberattacks. This SAP telemetry integrates directly with existing ticketing systems and SIEMs, providing necessary visibility to the Security Operations Center (SOC).

DevSecOps secures custom code intended for SAP production applications from development to transport. Onapsis Control integrates with popular development environments to deliver automated application security testing (AST). During migrations, DevSecOps solutions analyze internal and third-party custom code to identify security, compliance, and performance issues, automatically blocking critical vulnerabilities from reaching the production environment.

Compliance software automates the testing and validation of technical evidence against established frameworks. By automating SAP compliance audits, utility organizations proactively measure risk to stay ahead of the audit cycle. Solutions like Onapsis Comply utilize out-of-the-box policies for SOX, GDPR, and NERC CIP, making the audit process drastically less costly and labor-intensive while ensuring compliance is maintained during cloud transformations.

If you are interested in learning more about ERP software for the utility industry, take a look at the following resources or sign up for The Defenders Digest here.

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