Sales 0800 188 4767 Support 0161 822 2580

Calculate the cost of downtime to your business

Posted 02 Sep, 2019

Home » Resources » Calculate the cost of downtime to your business

Every second counts

In today’s digitally enabled world, businesses are more technologically dependent than ever before.  Any level of downtime can impact how a business operates – be this sales taking capability, web traffic, customer calls and of course not forgetting the effect to the workforce as the ever-increasing use of cloud-based applications demand greater dependency on resilient internet connections. In fact, Gartner predicts that the average cost of business downtime is approximately £4,400 per minute, the equivalent to £264,000 per hour.

Yet considering that a connectivity failure can stop the day to day in its tracks its quite surprising that only 27% of UK SME’s, and 25% of larger enterprises have business continuity plans in place*.  So if you’ve never considered the true cost of business downtime, don’t worry you’re not alone!  This blog considers the key reasons behind disaster recovery inertia and the compelling reasons why it should be top of the to do list.

You can check out the potential cost to your business of an outage by using our Down Time Calculator, powered by Zerto.

Disaster inertia – why don’t businesses have disaster or back up plans?

It is well known and documented how complex, not to mention time, finance and resource heavy, the process of disaster recovery planning can be. In many organisations, particularly smaller ones, DR often gets pushed down the priority list. The most commonly cited reasons for lack of backup processes and procedures in place are:

  • Complacency: It won’t happen to us!
  • Budget: Cost of outlay v cost of downtime
  • Buy-In: Lack of support from senior management
  • Confusion: What is the right solution?
  • Skills: Lack of skills within the organisation
  • Security: Compliancy concerns
  • Legacy Environments: Limiting options

Calculate your downtime costs

Its fair to say that the impact and losses will vary greatly between  organisations based on size/nature of the business, but costs are not just external / customer facing, the impact of internal costs in terms of delays to projects and critical systems are significant too.

To calculate the estimated costs of an outage there is a complex calculation known as the Disruption Cost Formula, which is as follows:

Cost of Disruption (per hour) = Lost Revenue + Lost Productivity + Recovery Costs + Intangible Costs

For many undertaking this exercise can be eye-opening and makes the cost of Disaster Recovery significantly cheaper – that’s before you consider the impact from loss of critical infrastructure, information, or paying a Ransomware demand.

Boost your business resiliency and minimise your downtime through boosting your business resiliency and having a disaster recovery plan in place.

Adding resilience to your connectivity means you can insure against foreseen events that cause downtime allowing your internet connection to stay intact, meaning productivity will not suffer.

In addition to this a comprehensive disaster recovery plan removes the risk in the simplest way possible. It represent a simple to implement, cost effective solution that takes minimal time to manage, leaving you to concentrate on growing business, delighting customers, and doing what you do best.

M247 offer a range of truly resilient services including wireless leased lines and wired fibre leased lines. Having a connection in the ground and through the air is one of the only ways your businesses connectivity can be truly resilient.  If you would like to discuss your backup, disaster recovery or resilient connection with us, get in touch to see how we can help.

Further reading

Webinar – Avoid a disaster with your disaster recovery plan

Infographic – Think you have Disaster Recovery covered? Think again

*Data from www.tandemsystems.co.uk