The Real Cost (and Impact) of IT Services Downtime

March 10th, 2020
The Real Cost (and Impact) of IT Services Downtime


The Mistake of Focusing on IT Downtime Cost Instead of Long-Term Business Impact

What are the costs of IT services downtime?

When it comes to your business and the critical infrastructure that powers it, what’s your company’s plan? Many companies don’t have a comprehensive plan to ensure IT downtime and related costs are minimized.

Are the costs of IT downtime so insignificant that they can be ignored by IT and business leaders?

Gartner’s 2014 analysis pegs the cost of IT downtime at $5,600 per minute. Eweek’s article based on Emerson Network Power’s research in 2011, concurs. Aberdeen’s 2016 research indicates $260,000 per hour, up 60% since 2014 research. A 2018 Forbes article, Why CTOs and CIOs Should Care More About the Cost of Downtime, highlights a $102 million financial impact on British Airways due to a technological failure.

I’ve read the question about the cost of IT services downtime over and over and seen all kinds of answers for it. Usually it comes with research-backed estimates or a sexy calculator showing the number of files or volume of data, all translated to a dollar value, to illuminate the financial costs to your organization.

Yes, the loss of specific files and/or data will result in a huge cost impact. But, what about ALL your data? What about all your IT solutions and systems?

The reality is that risk exists. Have you thought about how that risk will impact people outside your organization? How would a 4-hour outage impact your customers, or the way the public perceives your company? Have you done the work to identify which parts of your IT environment your business can’t live without?

Understanding Your Organization’s IT Services Downtime Risk

Avoiding that risk is virtually impossible without know what the risk is. So, how do you find out about your IT downtime risk?

As much as we’d like to bury our heads in the sand, cross our fingers, and hope that our organization’s IT solutions team has “got it handled”, it’s crucial to really understand IT services risk and how IT downtime can impact the business. Ask the hard questions that you really don’t what to know the answers to:

  • Can we commit to our client obligations if…?
  • Can we keep selling if…?
  • Can we receive revenue and pay bills if…?
  • Can our staff still work if…?

Answering the question, “What is the cost of IT downtime?” isn’t directly associated with files or megs of data or recovery costs.

The real cost of IT services downtime is the overall impact on the business. The intangible goals that we may not measure in dollars but do have an immense long-term financial impact on the organization:

  • Client Relations – ensuring that you keep your promises
  • Employee Retention – happy and productive employees
  • Brand Reputation – you’ve spent years building your brand and that brand equity can be wiped out
  • Business Growth

Mitigating the Risk: Backup and Disaster Recovery Best Practices

So, what IT solutions can be put in place to limit the impact WHEN unplanned events occur?

Technology people generally live by the 3-2-1 rule for backups: 3 copies of your data, on 2 different mediums, and 1 copy should be offsite.

That’s a great start, but let’s dive a little deeper:

  • When was the last time your business tested the integrity of your backups?
  • How do you recover when it’s your backup platform that’s been compromised?
  • Do you have a plan for what would happen if these IT solutions and systems have been compromised?
  • Does that plan have a person responsible for it? (From I’ve seen lately, the person who wrote the plan is first person off the ship.)

The problem with most Disaster Recovery Plans or IT Business Continuity Plans is they are static processes with vague procedures to back them. They might be tested once a year by the person who wrote them, who pats themselves on the back and congratulates themselves on a job well done.

But, is that the level of scrutiny your organization should be satisfied with, given the colossal impact when things go wrong; IT services downtime is virtually inevitable, and the fallout needs to be pre-planned and well-managed with the right IT solutions. When the time comes, you need to have a plan, and that needs to be communicated and tested.

Contact us to find out how you can implement the right IT solutions
to minimize IT downtime with proactive IT planning.

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