September 23rd, 2019 by admin
Whether it's caused by human error, technical failures, or natural disasters, downtime can happen at any given moment. Your business is then left having to deal with the costs caused by it. But how much are you really losing every time you have to repair, reboot, or recover your systems and infrastructure? The real cost of downtime can be more than most businesses realize.
According to the Ponemon Institute, the average cost of unplanned downtime for the year 2016 was $8,850 per minute. While the average cost hourly of an infrastructure failure is $100,000 per hour and for critical application failure per hour is $500,000 to $1 million. However, these numbers won't apply to every business as this data was collected from Fortune 1000 companies. Luckily ITonDemand a way to calculate the costs for yourself?
Cost of Downtime (per hour) = Lost Revenue + Lost Productivity + Recovery Costs + Intangible Costs
This formula can be broken down into:
- Lost Revenue = Revenue/hr x downtime(hrs) x uptime(%)
- Lost Productivity = Employee Salary/hr x Utilization % x Number of employees (with same Utilization %)
- Recovery Costs – The costs accrued while fixing the issues that caused the down time, such as repair services, replacement parts, and lost data recovery
- Intangible Costs – These are the costs that occur when downtime causes long-term damages, like those that can happen to your reputation or brand.
By using the formula above, you can start to see just how much downtime will not only cost your business but how it can hurt it as well. That's why it is imperative to make sure when your business does suffer from downtime; you spend a minimal amount of time recovering from it. Get managed backup services with Republic Voice & data, and minimize how much downtime will cost you.