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Downtime Math Class: How Much Is It Costing You?

You can always tell how lucky someone’s been by asking them about outages or data loss. If they say it’s not an issue for them, or treat data loss as a pesky inconvenience, and say their incident response plan is something they’re getting around to – then you know you’re talking to someone who’s been very lucky indeed.

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Because once you’ve lived through a major outage or seen the kidnapping and/or disappearance of valuable files, you’ll never be nonchalant about downtime or data loss again.


Downtime – the surprise kind, the kind that brings business to a screeching halt while your leadership demands to know what is happening – is always an issue. Data loss? Talk to some of the enterprises that have seen criminals make off with millions of data records, and ask them what the repercussions have been. (Hint: costly and ongoing.)


There’s a reason today’s downtime is a way bigger problem than yesterday’s downtime. The cloud, big data, the rise of mobile – it all equals an exponentially multiplying amount of data, but also an increasing digital dependence for your employees and buyers.


Here’s what’s at stake when you go dark or lose data.


Productivity. When is the last time your workforce put in a full day’s work offline? Downtime means you’re paying employee wages when nothing is happening. Even a minor data loss can mean weeks of backtracking and duplicated work.


The IT scramble. Your e-mail and Internet are out, your servers, networks, and apps are on the fritz, and your teams are in overdrive trying to find the problem and fix it. Everything else goes ignored, creating an immense backlog of work for the teams.


Sales. Deals are put on hold. Impatient customers want to know why they can’t see their shopping cart. If CRM data is lost, even long-standing client relationships will be impacted.


Brand perception and customer faith. There is no embarrassment like downtime, as buyers notice your competitor seems to always be up and running. And having to send out that awful email telling customers you were breached and their data was stolen? Deadly.


Employee morale. No one likes working every weekend because technical difficulties with their office systems are constantly putting them behind.


Regulatory fines and repercussions. Failed compliance audits and fines from PCI-DSS or HIPAA can be severe, along with the cost of preparing for the increased audits that follow.


In other words, downtime or data loss is like a bomb that keeps going off. Even if it’s “over” fairly soon, the dollar sign attached is going to hit your budget hard. And we haven’t even mentioned the recovery process – the late nights cleaning up your environment, the need for new equipment, the resources going to getting caught up instead of creating new products or services.


So just what will that dollar sign look like for you?


Doing the Math on Disasters


A recent IHS Study found that outages cost enterprises $700 billion a year. These companies reported an average of five downtime events each month, with each downtime event costing between $1 million a year for a midsize company to more than $60 million for a large enterprise.


Of course, the hypothetical cost for your organization depends on multiple factors. So here’s a formula to calculate your potential cost:


Lost Revenue + Lost Productivity + Recovery Costs + Cost of Brand Damage = Cost of Downtime


We get it - none of this is pleasant to think about. And if you spend time in the Quorum community, you know our advice: use a BDR solution that creates accurate, up to date replicas of your environment that can be available and running in minutes. Create a solid response plan. Educate leadership on data loss costs and train employees to avoid common mistakes.


Ultimately the real cost of downtime and data loss is the loss of the future you could have had. The talented employees who didn’t quit, the shoppers who wound up buying and then buying again, the new projects and products your team would have launched had they not spent months cleaning up. But regardless of your past, you can strengthen your future today by choosing the right strategies and solutions. You don’t need a math class to see that the rewards are worth it.

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