Do You Know The True Cost of Downtime?

Most business owners know the feeling… they head into the office early one morning, anxious to get to work on a critical meeting the next day. But when they arrive, they discover that their network is down, their email isn’t working, and the files they need are gone. Then they learn that their network is going to be down for at least a full week – maybe more.
The cause: Their six and a half-year-old server just died.

The Cost of Downtime

Similar stories repeat over and over, every single day. It’s no surprise, since 90% of businesses experience unexpected downtime.
In North America alone, downtime costs businesses a whopping $700 billion per year. What does that mean for small businesses? A study from Acronis suggests that network downtime costs 80% of small to medium-sized businesses at least $20,000 per hour. The other 20% estimated costs at $100,000 or more.

frustrated businessman
Don’t let this be you.


The dollars add up quickly when you consider all the impacts of downtime. The biggest cost is often loss of employee productivity. Think of how much interruption it causes in your day when your email isn’t working or you can’t access the Internet. Then multiply that for all your employees.
Downtime also goes hand-in-hand with data loss. If your server dies or your network is hacked, how much data will you lose, and how long will it take you to recover it? The cost of losing your data are likely greater than the cost of upgrading your hardware or software.
Futhermore, if your business relies on a high volume of transactions like an online retailer or a bank, downtime means significant loss of revenue. Recently, part of Amazon’s cloud-computing services went down, costing companies using the service an estimated $150 million.
Lastly, downtime has a cascading impact, which can cause additional, less tangible costs. If your downtime affects your clients (like we just saw with Amazon), you may face brand reputation damage. During downtime, many employees also admit to using personal email or devices, which may increase your security risks.
Downtime can range from a few hours to a few weeks.  No matter how long your systems are down it’s painful.  Your customers suffer, your employees suffer and your bottom line suffers. One week of downtime for a business that relies on their computer system can cost tens of thousands of dollars.

Causes of Downtime

We all know that natural disasters like floods, hurricanes and tornadoes can cause computer downtime, but they only cause about 5 percent of the incidents. There are other less public issues that cause more devastation.
Hardware failure typically tops the list – from power supplies to hard drives to full servers, hardware loss can cause substantial downtime. Software and network failures are also common, especially when they aren’t properly updated and maintained.
Then there’s the human component. Human error is a constant concern, and incidents like the one with Amazon show the disastrous impact one little typo can have. Even worse, malicious users are always inventing new ways to infect your systems, and hackers, viruses and ransomware can cause huge amounts of damage to your computer systems.

Protecting Yourself Against Disaster

In today’s robust and highly competitive business climate, just backing up your data files does not sufficiently protect your business against prolonged downtime. Businesses must ensure that their data is quickly accessible in the event of an emergency. Furthermore, professional organizations such as medical practices, law firms and CPA’s must guarantee that their data is secure and in many cases encrypted as well.
Basic tape, hard drive, and flash drive backup solutions do not and cannot protect your systems any longer.  You need a business continuity plan so that you do not suffer tens of thousands of dollars of damage from unplanned downtime.
Here is an infographic from Dell on business continuity and disaster recovery that shows the leading causes of data loss and some other startling statistics.

Steps for a Business Continuity Audit

  1. The best thing to do right away is have a trusted and qualified IT firm provide you with a business continuity audit.
  2. Next establish what your RTO (response time objective) and RPO (response point objective) objectives are.
  3. Then review what the ROI would be to meet those objectives with a proper intelligent business continuity plan.

The plan should include both a way to secure and retrieve your system quickly on premise as well as in the cloud.  By doing this, you ensure that no matter what takes your system down, you can be back up and operating as quickly as needed.
It’s not a question of if you experience a significant downtime occurrence. The question is when and will you be prepared to meet the challenge?
If you’d like help assembling your business continuity plan today, contact us for a free consultation.