Archive for June, 2009
Calculating The Cost Of A Data Disaster
Data loss emergencies can hit any business without any prior indication of a potential problem. Sometimes data loss issues can be nothing more than a business hiccup and not to much data is lost, or the lost data can quickly be reworked to get the situation back to normal. Conversely though large data loss scenarios can have an devastating effect on a business and the more employees they have or the more reliant they are on their IT infrastructure, then the bigger the problem.
A typical example of a large data problem would be perhaps a failed disk or raid array on a Microsoft exchange server. E-mail is becoming the life blood of many organisations and without it effective client and supplier communications can quite literally cease.
The effect will of course impact larger companies more than smaller organisations but the effect of data loss can still be quite devastating none the less.
With the ever increasing reliance on IT most business owners will have started to become reasonably educated about the need for a disaster recovery plan for their business, and plans may have already been put in place but this does not make the system infallible as if the plan has note yet been tested, or has not been implemented which often happens if a business waits for suitable window if a server needs upgrading for example, then the company will still be open to risk.
The net effect of a data loss emergency can simply cost thousands and for large corporations tens and sometimes hundreds of thousands. The actual cost will course depend on the type of business involved and costs can be both tangible or intangible for example: the cost of lost sales can be easily measured by comparing a previous days trading.
This can be a useful yard stick to justify the return of investment in a business continuity plan so for example if a business was clearing only 2k in sales per hour then a days downtime could result in a gross loss of 16k in sales alone.
Obviously this would scale up or down depending on the business affected. Other costs that can be factored in could also include the actual cost of recovery, legislative fines due to failure to hold critical business data and of course future sales if essential client records have been lost.
As well as measurable costs a company also need to factor intangibles into any return on investment or risk reduction calculation. Typical factors here could include activities such as re-population of customer CRM systems, additional management costs and business costs of running temporary as opposed to automated IT systems etc.
Another critical factor that should never be overlooked in the event of a data emergency is the restoration of the data. In many cases data can be irrevocably lost due to bungled attempts at recovery by inexperienced IT technicians.
Also if you are employing the services of one of the data recovery companies you need to check their potential methodology and ensure they will not work on the actual donor disks as it is crucial to keep the main data source intact at all times.
Specialist business continuity providers will have strict protocols in place to ensure the absolute integrity of the source data. Working on the original data hard drives should simply not be an option because if the file structure or data is compromised in any way then your business could experience total data loss.
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