A survey conducted by the Business Continuity Institute in cooperation with Zurich Insurance has found that close to half (46%) of the surveyed organizations in Asia-Pacific did not have any insurance to cover their supply chain losses and that six out of 10 organizations in the region have experienced at least one supply chain disruption in the past 12 months, with a quarter of those incidents costing over US$1 million.
According to the eighth annual Supply Chain Resilience Report, supply chain disruptions can cause significant damage to companies and their operations, affecting not only revenue, but even share prices and reputation.
The report showed that the top five causes of supply chain disruption in Asia-Pacific are IT/telecoms interruption, extreme weather, transportation issues, cyber attacks or data breaches, and outsourcer failures.
It was also revealed that only 30% of disruptions happen with an immediate supplier, meaning that most problems come further down the chain. Also, only a minority (48%) of respondents said that their organization’s management has made a commitment to supply chain resilience.
“Effective supply chain risk management and a comprehensive risk assessment can present significant benefits to businesses,” said Hassan Karim, technical underwriting manager for Zurich Asia-Pacific.