“What is the actual cost in $$$$$$ to your business if you were down for a day?”
I get a lot of wild guesses, but very rarely do I get a number back from the audience that is based on actual calculation for their specific business. According to the “Symantec 2011 SMB Disaster Preparedness Survey - Global: January 2011” the average loss in dollars due to downtime for a small business is $3000 per day, and for a medium size business, it is $23,000 per day. This is a pretty significant number and it may be different for your business. The important point is that, there is a definite dollar loss to a business when its normal business processes are disrupted. The downtime is defined as any event, whether natural disaster ( floods, earthquake) or more common ( power outage, internet outage, server down etc), that causes the disruption of normal business workflow. The disruption could be as short as a few minutes or could last for days.
How does one calculate the real cost of business downtime? The dollar loss can be broken down in to 3 major components namely:
- Loss in labor
- Loss in revenue
- Loss in services and goodwill
The Symantec SMB ( small and medium size business) survey also sheds light on three important findings:
1. Despite warnings, most SMBs are still not prepared for disaster
- 50% don’t have a BDR(backup and disaster recovery) plan in place
- 41% never thought about putting a plan in place
2. SMBs are at risk
- 40% said disaster recovery is not a priority
- <50% of SMBs back up their data weekly or more frequently
- 23% back up data daily
3. SMBs do not act until it is too late
- 50% of SMBs that implemented a BDR plan did so after experiencing an
outage and/or data loss
- 28% actually tested their recovery plan
Clearly, the loss in dollars due to business downtime can prove catastrophic for a business. It is critical for a business to understand the value of reduced downtime and take necessary measures to eliminate it. Creating a formal written BDR plan can go a long way in ensuring that your business continues to operate even in the face of unforeseen disruptive events.
There are many technologies available today that not only reduce downtime, but also eliminate it. These are now affordable to small businesses. A good disaster recovery plan should consider the business workflow and then identify appropriate technologies that can address the business needs. Given the limitations of time, money and resources, it can be overwhelming for a small business to research and implement the appropriate BDR technology. Consider enlisting the help of a BDR consultant who can understand your business workflow, and work with you to create a formal, written BDR plan and help you implement policies, processes and technologies that will ensure business continuity.
Please don’t leave your business to chance! Be prepared.