Connection. The backbone of the modern business. It's safe to say that without a reliable connection to your customers, suppliers, and your employees, your business would not survive.
Unfortunately, sourcing a 'reliable' internet connection can often be a painful and expensive issue for many businesses.
An independent XERO survey of more than 1,000 Australian small business owners looked at how phone and internet connectivity affects business productivity, hiring, and growth, finding that:
- 48% of businesses struggled to reach and connect with new customers because of unreliable and patchy phone and internet connections.
- 70% of businesses said poor connectivity was hindering their efficiency and productivity.
- 62% of businesses believed poor internet and phone connections affected their quality of customer service.
In addition to network connectivity issues, there are many factors that can cause IT downtime for your business, and in turn, impact your bottom line.
Gartner previously calculated that the average cost of IT downtime was $5,600 per minute. That calculates to roughly $300,000 per hour!
More recent research raises Gartner’s average from $5,600 per minute to nearly $9,000 per minute...
Do you know the true cost and impact of IT downtime on your business? First, let's look at what IT downtime actually is, and what can cause it.
What is IT downtime?
PC Mags' Encyclopedia defines 'downtime' simply, as "the time during which a computer is not functioning due to hardware, operating system or application program failure." IT downtime can also be extended to include phone systems and networks that stop functioning.
While IT downtime can be planned to complete maintenance and ensure optimal functionality at a time that is most convenient and minimises negative impact for users, unplanned IT downtime can cause disruption to operations at any time of the day or night.
What causes downtime in Australia?
Common causes of IT downtime include:
- Human error
- Internet outages
- Server hardware instability
- Security breaches
- Aged equipment failure
- Software and hardware failures
- Power failures
- Hardware/software incompatibility
- Insufficient cooling
- Natural disasters
The impact of IT downtime
Gadi Oren, Vice President of Technology Evangelism of LogicMonitor says that “IT availability has become one of the business world’s most valuable commodities, but also the most difficult to maintain. Organisations today are increasingly dependent on the availability of their IT infrastructure.”
Oren goes on to say that “a single IT outage can have huge negative business impacts including lost revenue and compliance failure, as well as decreased customer satisfaction and a tarnished brand reputation. Comprehensively monitoring IT infrastructure is key in detecting the early warning signs of impending IT outages and acting in real-time to course-correct before it’s too late.”
Most businesses would think only of the financial costs associated with IT downtime, however, true costs of downtime are much farther reaching, including:
- Financial costs of lost revenue per hour
- Cost of lost productivity
- Cost of diminished reputation amongst customer base
- Cost of internal employee morale
- Cost of recovery from IT downtime
How to calculate the cost of IT downtime
Australian Software Development giant, Atlassian, explains that to get a quick estimate of your company’s probable downtime costs, use the following formula, based on the size of your business and the number of minutes your most recent incident lasted:
Downtime cost = minutes of downtime x cost-per-minute.
And suggests that small businesses use $427 as cost-per-minute, and medium and large, use $9,000.
How to minimise the risk of IT downtime
The figures mentioned above emphasise that minimising downtime should be a priority for all Australian businesses. So, how can business leaders mitigate downtime risks?
- Regularly update and actively monitor your devices
- Monitor the health status of your servers
- Train your employees
- Conduct a risk audit of your facilities
- Test your server backups
- Evaluate your internet and phone service providers
How Diamond IT can support your Technology Infrastructure
Our team are here to ensure your infrastructure meets your strategic business needs and are experts in ensuring your IT investments are fit for purpose secure and support your technology roadmap.
If it's time to put a strategy in place to upgrade your infrastructure to ensure maximum IT uptime, contact our team today on 1300 307 907.
