Zurich Insurance and the Business Continuity Institute have released the Supply Chain Resilience Report 2016, which looks at the origins, causes and consequences of supply chain disruption around the world.

According to the report, IT/telecom outages was the number-one cause of supply chain disruption.

Six out of 10 organizations experienced at least one disruption during the past year, with one in four exceeding US$1 million in losses. However, 46% of organizations did not insure their losses.

“Effective supply chain risk management and a comprehensive risk assessment can present significant benefits to businesses,” said Hassan Karim, technical underwriting manager at Zurich Asia Pacific. “As an increasingly important driver of profit, organizations which have been able to invest in the necessary resources to start to push the boundaries of risk management in the supply chain have found that the benefits have far exceeded the investments they have had to make. Without such investment, the cost of disruptions could be devastating.”

About 30% of disruptions occurred beyond the preliminary supplier and approximately 30% happened at or below the second tier in the supply chain.

Only 48% of respondents said that there were commitments from top management regarding supply chain resilience.

The report’s respondents, who work in industries such as financial services, IT and communications, public administration, manufacturing, retail and wholesale, transport and energy, came from 64 countries, including 13 in the Asia-Pacific region, according to Zurich.