The Ponemon Institute, an independent research firm that studies IT security and data protection, publishes a report on the cost of data center outages every three years. The institute studies data centers of 2,500 square feet or more to determine what causes unplanned downtime and the impact of downtime on the organization.
The costs have gone up every year. The 2016 Cost of Data Center Outages report found that unplanned downtime costs $8,851 per minute, up from $7,908 in 2013. The average total cost of a data center outage is $740,357, a 38 percent increase since the first study was released in 2010. Maximum outage costs have skyrocketed 81 percent since 2010, and now total $2,409,991.
Those numbers are mind-boggling, certainly. But what on earth does that have to do with your business?
Your data center is probably smaller than 2,500 square feet — most likely a lot smaller. Unplanned downtime isn’t going to cost your organization anywhere near that much. Nevertheless, the analysis behind those costs applies to any business, and can help you understand the impact computer downtime has on your organization.
- Lost productivity. When your computer systems are down, your employees cannot do productive work. Estimate how much each employee depends upon your computer systems and multiply that percentage by the employee’s hourly rate. Calculate the total costs for all employees to determine the cost per hour of lost productivity.
- Lost revenue. If your employees can’t process orders or your customers can’t reach your e-commerce site, you’re losing money every minute. The costs will depend upon how much of your revenue relies upon your computer systems. Estimate that percentage and multiply it by how much revenue you typically generate per hour.
- Recovery costs. These are the hard costs associated with getting your computer systems back online and recovering any data that is lost. It would include the costs of any outside services and replacement equipment.
- Intangible costs. These include damage to your business reputation and lost opportunities. Depending upon your industry, there may also be legal or regulatory consequences.
The costs of computer downtime are a sobering reality, but the good news is that they can be minimized. Let’s take a look at what causes unplanned outages, according to the Ponemon study, from most to least expensive:
- Failure of IT equipment
- Power or cooling system failure
- Human error
There’s not much we can do about the weather, but the top four causes of downtime can be mitigated by proactive IT maintenance. By monitoring systems for potential problems. By keeping systems up-to-date and patched. By following best practices for IT management, security and data protection. Yes, there’s a cost associated with these activities, but the cost of downtime is potentially much, much more.
Unplanned downtime is inevitable — even the largest data centers experience it. And the costs continue to rise as organizations become increasingly dependent upon the availability of their computer systems. That’s why it’s so important to monitor and maintain your computer systems.
At SSD, we are committed to helping organizations like yours maximize productivity and minimize disruptions. Let us show you how our total IT management approach can help keep your computer systems and your business running smoothly.