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True impact of downtime

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Jasmina Vermezovic

There are many companies that are choosing backup solution based on the monthly or yearly cost of the solution itself. Although that is a valid starting point as the price itself is highly important aspect, one cannot avoid the question – is cheaper always better? Is it really that simple? Of course not.

Data loss is highly damaging but long downtime can be devastating as well. Sometimes being able to recover data just isn’t enough, being able to restore business operation in minimum time frame became essential. When evaluating backup solution it is well to take the speed of restoration into consideration, even if it affects the price.

Businesses that value their data seek effective ways of protecting it. This article aims to explain the costs of downtime, and therefore the importance of speedy data recovery in the event of a data loss caused by human error, hardware/system failure or a site disaster.

Why and how does downtime threaten the business

Modern businesses are faced with 24×7, all year round global operations and unrelenting customer demand. In these circumstances downtime can threaten their competitive advantage and influence their general operations. There is no definitive answer how much does downtime really cost, for it‘s different for every business, sometimes it is hard to express it in X amount of dollars.

Depending on the industry, the number of Stakeholders impacted and the duration of downtime, reputation, customer satisfaction, and overall confidence can be shaken by even a short outage.

What is Actually Being Affected by downtime

In short not being able to access their business applications, communicate with the customers/partners can and will reflect in:

  • Revenue losses (missed opportunities)

  • Impact to cash flow

  • Productivity losses

  • Compliance and reporting penalties

  • Penalties expressed in companies SLAs

  • Impact to customers and strategic partners

  • Damage to reputation

And it gets worse by the hour. According to a survey conducted by Forrester Research the hourly cost of downtime for a typical company can range from $10,000 to $1 million!

Almost all businesses today use IT to record their sales. Some organisations may still be able to take and fulfill orders manually, but  most retailers can no longer complete the sales process when their systems are unavailable. Their entire operational capability stops when their systems are offline.

Why Downtime is a Serious Business

Despite continual infrastructure and software advances occasional downtime is unavoidable. And even though not all businesses are affected the same by it, every organisation would like to avoid that situation.

Customers looking to protect their business are advised to investigate providers with a strong reputation. They may charge a brand premium, but their customers know that their data can be restorable when they need them, and with minimum downtime. After all customers trust providers with their businesses.

Minimizing the Downtime Increases the Costs

Keep in mind that backup and restore solutions that reduce the downtime are everything but free. The price tends to increase the closer a solution comes to promising near-zero downtime.

Before making a decision on the solution it is worthwhile analysing the financial impact and exposure that downtime has on the business. Understanding the potential impact of an outage, without one actually happening will lead an organisation towards a decision that will benefit the business and its stakeholders the most.

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About Jasmina Vermezovic

Jasmina Vermezovic
Jasmina works as part of the sales team at LiveBackup. Prior to moving into sales analytics and support, Jasmina was involved in the development of online platforms, technical documentation and web content for the backup services provider. During her professional career, Jasmina has worked in a variety of roles, including Marketing and Sales Copywriter, Account Manager, as well as Journalist/Editor for the major national news agency where she covered topics in economics, politics, education, social policies and IT related topics. Her interests include data management, data protection and IT trends.
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