The modern business relies on software it hasn’t fully built or directly managed. Open-source components, third-party libraries, cloud services, and vendor-developed code now underpin essential systems across different industries. This situation has brought the Software Bill of Materials (SBOM) into discussions about risk, compliance, and operational resilience.

An SBOM offers a clear view of the components that make up a software application. What used to be a concern for developers and security teams has turned into a key requirement for businesses, regulators, and risk managers. From tackling zero-day vulnerabilities to ensuring business operations during vendor issues, SBOM has become a critical capability rather than just a technical document.

This article explains what an SBOM is, why it’s important today, and how businesses are applying it in practice, moving beyond simple compliance.

What Is an SBOM?

A Software Bill of Materials (SBOM) is an official, machine-readable list of all components within a software product. This includes open-source libraries, proprietary modules, third-party dependencies, versions, licenses, and how the components relate to each other.

The idea is akin to a bill of materials used in manufacturing. Just as manufacturers need to know every part used to assemble a product, businesses need visibility into the software components that drive their operations.

The U.S. National Telecommunications and Information Administration (NTIA) states that an SBOM should have three main elements: data fields, support for automation, and practices for distribution and access.

Importantly, an SBOM is not a vulnerability report, a penetration test, or a static document. It is a dynamic record that supports ongoing visibility and decision-making throughout the software lifecycle.

Why SBOM Matters More Than Ever

Software Supply Chains Have Become Interconnected

Modern applications seldom function as standalone systems. A single enterprise application may depend on hundreds or even thousands of components, many of which are updated independently and maintained by outside contributors.

This complexity creates hidden risks. Businesses often don’t know what runs in their most critical systems until something fails. The Log4j vulnerability highlighted how one open-source component could threaten millions of systems worldwide, mainly because organizations lacked visibility into their dependencies.

SBOM addresses this problem by making software composition clear before an issue arises.

Regulatory Expectations Are Rising Globally

Governments and regulators no longer view software transparency as optional. In 2021, the U.S. Executive Order on Improving the Nation’s Cybersecurity specifically called for SBOM adoption in federal software supply chains.

Similarly, the European Union Cyber Resilience Act and other global regulations are encouraging organizations to adopt stronger software governance and accountability.

For businesses operating in multiple regions, SBOM helps show due diligence and preparedness in an increasingly regulated landscape.

SBOM as a Business Continuity Tool

Visibility Before Failure

Traditionally, business continuity planning has focused on infrastructure, backups, and disaster recovery sites. However, the risk associated with software dependencies has become a critical blind spot.

When a vendor is unavailable, a library is compromised, or a platform is discontinued, organizations without an SBOM must scramble to discover the details. This slows down response time, increases downtime, and heightens operational risk.

With an SBOM in place, enterprises can quickly find answers to questions like:

• Which systems are affected by a known vulnerability?

• What components are used in multiple applications?

• Which vendors or libraries pose single points of failure?

This proactive visibility changes continuity planning from improvisation to preparedness.

Faster Impact Assessment During Incidents

In the event of security incidents or supply-chain disruptions, acting quickly is vital. SBOM allows security and risk teams to assess exposure in minutes instead of days.

The Cybersecurity and Infrastructure Security Agency (CISA) has noted that SBOM is a key tool for reducing incident response time and boosting organizational resilience.

Instead of manually scanning entire environments, teams can query SBOM data to identify affected components and prioritize fixes.

SBOM Use Cases Across the Business

Vendor Risk Management

Businesses increasingly depend on third-party software providers for essential functions. However, traditional vendor evaluations often end with contractual assurances and security questionnaires.

SBOM brings technical transparency to vendor relationships. It enables organizations to:

• Validate vendor claims

• Understand risks associated with third-party components

• Connect dependency visibility to contractual obligations

This shifts vendor risk management from trust-based assumptions to evidence-based oversight.

Mergers, Acquisitions, and Due Diligence

Technology risk significantly impacts mergers and acquisitions. Buying a company without knowing its software composition can result in surprises after the deal, such as licensing issues, security vulnerabilities, and unsupported dependencies.

SBOM supports more thorough technical due diligence by revealing what software assets are being acquired and how sustainable they are over time. This enhances valuation accuracy and minimizes integration risk.

Licensing and Intellectual Property Compliance

Open-source licensing rules are often ignored until legal problems arise. An SBOM reveals licenses associated with each component, helping businesses prevent unintentional violations.

This is especially critical for organizations distributing software products or operating in regulated fields where compliance failures can lead to financial and reputational harm.

Where Traditional SBOM Approaches Fall Short

Despite the growing interest, many SBOM implementations don’t provide real value.

Common issues include SBOMs created as static PDFs that quickly become outdated, lack of validation to ensure accuracy, and no connection between SBOM data and operational workflows.

Without governance, version control, and integration into broader risk processes, SBOM risks becoming just another compliance document rather than a decision-making tool.

SBOM as Part of Structured Escrow and Continuity Frameworks

For SBOM to be effective, it must be integrated with other continuity mechanisms. Visibility alone does not ensure recoverability.

When SBOM data is maintained as part of structured software escrow documentation, it gains lasting value. Escrow guarantees access to critical assets, while SBOM clarifies what those assets involve and how they can be rebuilt or transitioned.

This combined strategy enhances organizational readiness for vendor failures, disputes, or unexpected exits.

Who Benefits Most from SBOM Adoption

SBOM is especially beneficial for:

• Businesses operating mission-critical software systems

• Organizations reliant on external technology vendors

• CISOs and risk leaders focused on operational resilience

• Procurement and legal teams overseeing vendor accountability

• Boards seeking assurance about software-driven risks

As software continues to support revenue, operations, and customer trust, transparency of dependencies becomes a strategic need rather than a technical choice.

The Role of CastlerCode in the SBOM Landscape

CastlerCode aids businesses by embedding SBOM visibility within structured technology escrow and continuity frameworks. Instead of viewing SBOM as a standalone tool, CastlerCode integrates it into a broader system that combines software transparency with access, governance, and recovery readiness.

By keeping SBOMs alongside escrowed assets, organizations achieve both visibility and control, ensuring that software continuity is intentional, not assumed.

Conclusion

SBOM is no longer just a security task or regulatory formality. It is essential intelligence for businesses operating in complex, software-driven environments.

By clarifying what supports the business, SBOM enables faster decision-making, stronger risk management, and more resilient operations. Organizations that adopt SBOM proactively shift from reactive security to structured continuity and long-term trust.

To discover how SBOM fits into a broader strategy for software continuity and governance, check out CastlerCode’s solutions.