Downtime is costly. In short, downtime in IT programs describes anytime an organization cannot access its systems, networks, or machines. Downtime can have a range of potential causes, from a software bug to hardware failure or human error. Regardless of the reason, the consequence is the same: a financial cost.
The losses can be significant, and the cost of downtime is increasing yearly. A survey from Statista found that the average cost of downtime in 2020 is between $301,000 and $400,000. Uptime Institute's 2022 Outage Analysis found that over 60% of failures result in at least $100,000 in total losses, and 15% result in over $1 million.
Costs associated with downtime can include
- Lost sales
- Software costs
- Recovery costs
- Lost data
- Lost productivity
- Lost revenue
- Repair costs
What Is the Opposite of Downtime?
The opposite of downtime is uptime—the measure of system reliability, typically expressed as a percentage of time a machine remains in an available state (99.999% or five nines uptime).
Downtime Costs by Industry
Downtime costs are directly correlated to three things: business size, industry, and duration of downtime.
Understanding the cost of downtime for your organization will make the impact clear. You can estimate the cost of downtime by using the following steps.
- Identify revenue-generating areas
- Calculate revenue by the hour. You can do this by dividing average weekly revenue by forty hours or average monthly revenue by thirty days.
- Determine what percentage of revenue-generating areas rely on uptime. For example, if your organization depends on e-commerce business, 100% is reliant on uptime.
- Calculate the cost of downtime by the hour.
Keep in mind that not every cost can be associated with dollars. Productivity is often one of the areas impacted by downtime. You can also use the following formulas to calculate lost productivity.
- Lost Productivity = (no. of users affected) x (effect on productivity [in percentage]) x (avg. salary per hour) x (duration of downtime)
- Lost Productivity = (no. of users affected) x (effect on productivity [in percentage]) x (avg. profit per employee) x (duration of downtime)
- Lost Productivity = (no. of transactions per hour) x (percentage of affected transactions) x (avg. profit per transaction) x (duration of downtime)
Some other intangibles that are impacted by downtime are
- Damaged reputation
- Lack of confidence
- Security concerns
- Loss of momentum
Downtime Cost Reduction
As we mentioned before, downtime can be unpredictable, but there are ways to prepare for it. To reduce downtime risks and minimize downtime's impact on your business:
- Develop a Disaster Recovery Plan: There needs to be a plan in place should downtime occur.
- Ensure your devices are up to date: Regular updates and patches ensure the stability and security of your devices.
- Test backups regularly: Backups are a last resort during downtime, but you don't want to discover your backups aren't working until it's too late. Regularly testing your backups makes sure the recovery works.
- Monitor devices and networks: Strategies to monitor device health and performance add a layer of protection by enabling you to detect and fix problems early.
- Training: Since human error is a primary cause of downtime, training employees to remain vigilant against cyberattacks can bolster your uptime.
While these tactics are not 100% foolproof, they are ways you can actively prevent downtime.
How Anteris Can Help
Downtime is a significant threat to any organization. Often, downtime is unpredictable, but there are ways to prepare for it and fortify against it.
Downtime can cripple businesses, but Anteris offers solutions to minimize downtime and maximize productivity.
As a security-minded company, we work with our Clients to create the cybersecurity posture that best works for their company.
Since there is no way to predict everything, we also have multiple contingencies in place should downtime occur. Our goal is to keep our Clients up and running no matter what happens.
Let us make your technology freeing, not frustrating.