What are the actual costs of downtime?

 2018-02-16 01:18 PM by
What are the actual costs of downtime?

Downtime is a nightmare. By it’s very nature it arrives unexpectedly and becomes the wake-up call to put contingency plans in place for the future. But downtime can also be seen as an opportunity to test our systems and make sure we can avoid a repeat of the disruption.

 

The disruption begins by not being able to carry on with business as usual, but there’s more to it than that. There are other costs that businesses don’t provide for when planning how they’ll handle a disaster. Once it has happened to you, all the costs become clear. 

Four losses

The most obvious cost of downtime is the operational cost of not being able to deliver the goods, but there are other kinds of loss that are onerous to a business:  

  1. Revenue: lost opportunity and lost revenue from not being able to carry out a future sale
  2. Time: lost productivity and the need to repeat the work already done
  3. Brand credibility: broken trust customer relationships following unfulfilled promises
  4. Legal responsibility: regulatory requirements, such as not being able to report a data breach within the required 72 hours

Downtime is preventable, but it’s not easy, or cost effective, to devise and manage in-house when your staff are busy with core business all day. Think of the hardware and software needed to be able to relocate all operations temporarily to an off-site station so that you can carry on business while you sort the disaster out, and the time it’ll take staff to restore your data.

You also need to simulate your disaster recovery plan a couple of times a year to make sure you’re covered. In other words, managing your own plan takes a lot of time and effort. Luckily there are dedicated services out there that can help.

Downtime vs downtime management

It only takes a quick calculation to work out that the costs of downtime outweigh the costs of downtime management and that it’s more than worth putting a dedicated system in place. With a good disaster management service you can avoid:

  • staff sitting around unable to work while being paid, and worrying about their jobs
  • your cash flow being impacted by goods and services not being delivered, and not knowing who to collect outstanding debt from
  • disruption to your invoicing systems and not knowing who to invoice
  • the cost and effort of having to reinstate your data and services
  • the reputational damage that follows a break in operations
  • losing prospects and clients to competitors

For R1500 per month you could put basic disaster recovery as a service (DRaaS) in place to relieve the stress of having to devise a plan yourself.