We are firmly in the era of the Always-On Business, with users demanding ubiquitous access to data and applications. Yet, it appears that IT is failing to meet users’ demands. With the cost of lost revenue, productivity, opportunity and data exceeding $2 million per year, enterprises need to take control to avoid burning through millions of dollars.
Examples of the Always-On Business are all around us. In retail, we have just witnessed the end of the Black Friday weekend, where online shopping and extended opening hours mean total spending could reach $51 billion. Missing out on a share of this through IT downtime would be a huge blow to any retailer. In finance, the UK’s Royal Bank of Scotland was fined £56 million ($87 million) for 2012 IT outages. This latest fine means a single incident has so far cost RBS over £750 million ($1 billion) in fines, compensation, and making the necessary changes to ensure IT availability.
More than 90 percent of CIOs are now under pressure to meet increased availability requirements. The two most common factors driving the Always-On Business are more frequent, real-time interactions with data and applications, and the need to access applications at anytime and from anywhere – essentially, companies now need to deliver a truly globalized 24/7 user experience, or face either user backlash or penalties through, for example, breached SLAs. So how does one tackle this dilemma?
The effect of the Availability Gap
The major barrier to becoming an Always-On Business is what we call the “Availability Gap”, i.e. the difference between the level of availability an Always-On Business demands and what IT can physically deliver. Currently, 82 percent of CIOs admit they cannot meet the business’ demands. This is having immediate, and costly, consequences. We’ve already seen what an inability to guarantee availability cost RBS. Even a small gap can have an impact – a January 2013 outage lasting just 49 minutes cost Amazon.com more than $4 million.
A focus on these large-scale failures can be dangerous for enterprises – creating the impression that “it couldn’t happen here”. Yet Veeam’s Data Center Availability Report shows that the Availability Gap has a constant cost for enterprises. The guaranteed annual loss of more than $2 million is easily increased if downtime strikes at the wrong time, or lasts longer than expected. For instance, if Amazon.com suffered downtime at the same rate as the average enterprise, it would have lost at least $84 million in 2013.
Bridging the Availability Gap
Modernizing the data center is part of the solution to the Availability Gap, but it has to happen in the right way. There is no use in adding server virtualization, storage and OS upgrades, or cloud services to the infrastructure if you cannot guarantee 24/7 availability. For too long, availability has been seen simply as “backup”, a box to tick as part of any IT modernization strategy. Instead, availability needs to be at the forefront of strategy decisions – not a form of insurance in case the worst happens, but a means to guarantee the level of IT services enterprises need.
For the Always-On Business to work, availability solutions should offer five key capabilities. These are: high-speed recovery, recovering services in 15 minutes or less; data loss avoidance, with backups made at least every 15 minutes; verified protection, meaning failing to recover backups will no longer be an issue; leveraging backups to provide a production-like test environment, so that changes of the type that crippled RBS can be avoided; and complete visibility, so that any potential issues are spotted.
Implementing these capabilities would mean real savings. For instance, with high-speed recovery Amazon’s January 2013 outage would have (potentially) cost $1.2 million – a saving of $2.8 million. For the average enterprise, the maximum annual cost from downtime and data loss would be under $500,000; saving at least $1.5 million a year.
The fact that 78 percent of CIOs plan to change their availability product in the next two years gives hope for the future. If they can implement the capabilities that the Always-On Business needs, then the Availability Gap will start to become a thing of the past. Otherwise, enterprises should resign themselves to throwing away millions in lost revenue each year.
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Veeam Data Center Availability Report – Welcome to the era of the Always-On Business, 4.2 out of 5 based on 11 ratings
Author: Peter Ruchatz
Peter Ruchatz is the Chief Marketing Officer for Veeam Software with 15+ years experience in the IT and consulting industry (Salesforce.com, Microsoft, Boston Consulting Group and other.) Peter is responsible for Veeam's global marketing and communication strategies and efforts, including positioning and messaging, product strategy,... More