Cascading Risk in OT: Why Vendor Security Can’t Be Treated in Isolation

Industrial environments were never designed to be open ecosystems. But, despite what anyone could have predicted, today that’s exactly what they are.

OEMs log in remotely to troubleshoot PLCs and RTUs, integrators update control logic from outside the plant, and analytics providers pull historian data into cloud platforms to optimize production.

What used to be rare, supervised access is now routine – and often invisible. And that invisibility is a big part of the problem.

In OT, each external connection doesn’t just introduce a single risk. It creates a chain of dependencies that can extend from one vendor, to another, and far beyond your own organization. This is cascading risk – and in industrial environments, its impact is operational, physical, and immediate.

Key Facts on Cascading Risk

• Remote third-party access is increasingly recognized as both a primary attack vector and a primary path for cascading risk. 

• OT third-party risk extends beyond direct vendors into their suppliers, tools, and access mechanisms – allowing risk to progress across the OT ecosystem.

• For every direct third-party relationship, organizations typically have between 60 and 90 fourth-party relationships through suppliers, partners, and toolchains that they neither inventory nor monitor.

• Traditional third-party risk management (TPRM) was designed for IT, not cyber-physical systems.

• Managing cascading OT risk requires identity-based access and connectivity controls, not just questionnaires and annual vendor reviews.

How Third-Party Vendor Access Risk Shows Up in OT Environments

Most third-party risk programs assume a clean boundary: your network vs. their network. This assumption might largely hold true in IT settings, but in OT environments it quickly breaks down.

Because vendor access in industrial organizations isn’t transactional – it’s operational. When a third-party engineer connects to an HMI or PLC, they’re interacting with live processes that affect safety, uptime, and product quality. And access often happens under pressure – during outages, short maintenance windows, or production incidents where speed matters more than process.

To keep things moving, organizations frequently rely on shared credentials, standing access privileges, or broad permissions “just in case.” Over time, this creates a web of trusted connections that no longer reflects how work actually happens – or how risk can spread once access is granted. Research across industries continues to show that unauthorized or overly permissive remote access is one of the most common catalysts for security incidents involving third parties.

The result is an OT environment where access is widespread, but accountability is limited – creating the conditions for small issues to snowball into major operational incidents.

How Third-Party Access Becomes Cascading Risk

Now that remote access is common, vendors rarely connect from perfectly managed environments. Instead, they use their own devices, remote tools, and internal systems. Many depend on subcontractors or fourth-party service providers to deliver support and maintenance. Each layer adds another dependency – and another set of credentials, permissions, and potential vulnerabilities.

This eventually produces an access ecosystem that extends far beyond the plant itself. As access paths multiply, OT and security teams lose the ability to clearly see who is connecting, what systems they can reach, and how those connections relate to one another. Most organizations struggle to maintain visibility even into direct vendor access – let alone how subcontractors and fourth- or fifth- parties are connecting, which assets they touch, or how access is routed through vendor tools and external infrastructure.

In OT, this lack of visibility is far more than a governance issue; it’s how a single compromised endpoint can cascade into safety system bypasses, production stoppages, or site outages.

Why Traditional Third-Party Risk Management Falls Short in OT

This is where conventional third-party risk management hits a structural limit.

Most TPRM programs focus on who a vendor is – contracts, questionnaires, certifications, and periodic reviews. These steps matter, but they stop short of addressing the reality of industrial operations. After all, risk isn’t created on paper; it’s created when someone actually connects to a live system.

For OT teams and plant managers, the gaps show up in significant ways:

• A completed risk assessment doesn’t limit what a vendor can touch on the plant floor. Once connected, a vendor may still have access to multiple PLCs, HMIs, or production lines – even if they’re only there to troubleshoot a single issue.

• A signed SLA doesn’t contain the impact of a mistake or compromised session. If access is broad and network-based, one single error can ripple across systems that were never meant to be in scope.

• A yearly vendor review doesn’t help during a real operational incident. When a line is down at 2 a.m. and an OEM needs urgent access, no one is pulling out questionnaires or audit reports. Production has to resume, so access is granted quickly – and often with more privilege than intended.

In OT environments, security controls have to work at the speed of operations, not at the pace of governance cycles. When risk management stops at vendor vetting instead of extending into how access is granted, scoped, and monitored, it leaves cascading risk unchecked at the exact moments when systems are most vulnerable.

Remote Vendor Access Is the Biggest OT Risk Multiplier

Remote access is the primary mechanism through which third-party risk cascades – allowing issues that originate outside the plant to move rapidly across systems, sites, and environments. Recent research shows that remote third-party access is increasingly cited as the most common attack surface associated with vendor-related breaches.

When access is network-based, persistent, or overly permissive, a single compromised credential can provide far more reach than intended – from enterprise systems all the way into control elements governing physical operations.

This is why OT incidents typically don’t stem from exotic zero-days but from trusted credentials abused in ways no one anticipated and allowed to spread unchecked.

How to Reduce OT Third-Party Risk with Access-Centric Controls

Managing cascading OT third-party risk requires a shift from trusting vendors to governing access based on verified identity and context.

Effective OT risk reduction must include:

1. Visibility First

You must know:

• Who external users are

• Which OT assets they can reach

• What tools and protocols they use

If you can’t see what vendors are doing while connected to your systems, you can’t detect, contain, or interrupt cascading risk.

2. Least Privilege by Default

Vendors should only be able to reach the specific systems required for a task – nothing more. This limits the extent of the damage when something goes wrong.

3. Identity-Based Controls

Access decisions must be based on verified identity and context – not network zoning alone. This prevents risk from automatically spreading across shared networks or from corporate IT applications to OT production systems.

4. Just-In-Time Access

Standing credentials create standing risk. Time-bound access significantly reduces the exposure window in which cascading risk can propagate.

5. Continuous Oversight

Session monitoring, recording, and audit trails turn anonymous connections into accountable activity streams.

These principles align with industrial security standards like ISA/IEC 62443 and modern zero-trust guidance from NIST, but they must be implemented in ways that respect operational realities.

How to Manage Cascading OT Third-Party Risk Without Disrupting Operations

Cascading third-party risk is no longer an exception in OT. On the contrary, it’s built into how industrial operations run today. Every vendor connection introduces not just direct exposure, but extended risk that can travel through tools, identities, and access paths far beyond what traditional third-party risk programs can see or control.

At the same time, OT teams can’t afford security approaches that slow response times, add latency, or disrupt production. When controls are too rigid or poorly suited to cyber-physical systems, engineers and vendors are forced to work around them – unintentionally increasing the very risk those controls were meant to reduce.

The organizations that manage cascading OT risk effectively take a different approach. They treat access itself as the control point — governing who connects, what they can reach, and how long access lasts — in ways that align with operational realities. Identity-first access, least privilege by default, and architectures designed specifically for OT allow security and productivity to reinforce each other instead of competing.

For more insight into how to reduce third-party and cascading risk, read our recent white paper, From Blind Trust to Full Visibility: How to Take Control of Third-Party OT Access.