Despite advances in infrastructure robustness many organisations still face database, hardware and software downtime. These can last for short periods, or days, resulting in huge losses. IT failures have become a feared yet expected aspect of enterprise life, and the cost to a business varies depending on business size and vertical, but it is a real cost that is often miscalculated.
Downtime experienced could be anything from the loss of a mission-critical application service, or the loss of data which could have potential legal and financial impact. In our world of ‘always on’ we expect data centres to run 24/7 and we expect applications to be always available; not taking into account that these services are run by people and human error is a factor. According to The IT Process Institute’s Ops Handbook up to 80% of unplanned outages are due to ill-planned changes made by administrators and developers. A Gartner study projected "through 2015, 80% of outages impacting mission-critical services will be caused by people and process issues, and more than 50% of those outages will be caused by change/configuration/release integration and hand-off issues¹".
The cost of downtime
It's not only the vertical and business size that has an impact on downtime cost, but what mission-critical applications are affected. The below table shows the estimated outage cost-per-minute of common critical applications business run, some of the figures may surprise you.
|
Profit draining potential
|
|
| Business application |
Estimated outage cost-per-minute |
| Supply chain management |
$11,000 |
| E-Commerce |
$10,000 |
| Customer service |
$3,700 |
| ATM/POS/EFT |
$3,500 |
| Financial management |
$1,500 |
| Human capital management |
$1,000 |
| Messaging |
$1,000 |
| Infrastructure |
$700 |
SOURCE: ALINEAN
How do you calculate downtime?
Calculations of downtime can be difficult to pinpoint. The above table will help you plan for application outages or use a Recovery Time Calculator to find out the data loss implications and wider business costs downtime could cause.
The real cost of downtime takes into two crucial factors the Recovery Point Objective (RPO) and the Recovery Time Objective (RTO). The RPO refers to the point in time that you need to revert back to; this could be seconds, minutes or hours depending on your business. The RTO refers to the time it takes to recover the data, how long can your business afford to be down for? Again, the RTO could be hours, weeks or minutes. These two objectives along with recovery process data and downtime costs are used to calculate your recovery time.
Soft costs are real costs too
Downtime can result in lost revenue but what about other costs? Some of the soft costs associated with downtime are:
> Damaged reputation
> Lowered employee morale
> Shaken customer loyalty
> Lost opportunity
To get an idea of these costs, businesses will need to ask themselves what is the cost of replacing an employee? Of losing one client? Of repairing their reputation with a marketing and/or PR campaign? For those at enterprise level these costs could also include tangible elements that reflect the costs of reputation impairment like stock downturns, marketing man hours and media dollars required to reboot and polish up an organisation's profile.
¹ Ronni J. Colville and George Spafford Configuration Management for Virtual and Cloud Infrastructures
