As an IT manager, you’ve got a lot keeping you up nights due to an outage:
- Is my company’s data securely backed up, preferably to the cloud?
- Are we prepared for an unexpected power outage?
- Is there a battery or generator backup in the event of a power outage?
- Am I doing all I can to ensure our network stays up and running when—not if—that outage occurs?
- How much is that outage going to cost us?
If these questions aren’t top of mind for you right now, we’ve got one word for you: Texas. The recent unprecedented weather-driven disaster darkened the Texas power grid for the state’s 26 million customers and will cost the economy upwards of $20 billion. Overall, outages cost an average of about $18–$33 billion per year in the United States.
Let’s put that in perspective and bring it closer to home. According to Information Technology Intelligence Consulting’s (ITIC) Hourly Cost of Downtime Survey, 40% of enterprise organizations peg the cost of a single hour of downtime at $1–$5+ million. Small and mid-sized businesses don’t escape the pain, either. One hour of downtime costing $10,000 equates to $167 per minute per server, while $25,000 in hourly costs adds up to $417 per minute /per server. Ask any SMB owner and those numbers resonate—and they don’t factor in lost, damaged, stolen, destroyed or changed data, nor the potential for lost business, equipment failure and damage to their reputation.
Of course, these are variables — but you can approximate your business’s hourly outage cost for yourself in three different ways, and it’s a smart idea to do this before disaster strikes.
- Multiply your number of employees by their average hourly wage
- Divide your average daily sales by the number of operating hours you have each day
- Add your labor costs per hour to your revenue lost per hour
If you’re even more invested in determining your power outage costs, check out the online Interruption Cost Estimation (ICE) Calculator, funded by the U.S. Department of Energy Office of Electricity, which estimates the cost of power interruptions and the benefits of reliability improvements.
Of course, you can lose more than money, including these valuable resources that can be wiped out in a power outage:
- Lost customers and revenue, and the attendant costs of trying to win them back
- Lost stored computer data, because improper, unexpected shut downs can result in lost or corrupted files and damage to your hard drives.
- Inventory disruptions, since downtime due to an outage decreases the speed at which you can sell your inventory and increases your unturned inventory.
- Employee productivity issues, including increases in IT employee overtime expenses to resolve problems as well as the cost of hiring additional skilled professionals to help recover lost data and get systems running again.
- Long-term equipment damage, because the greatest cause of equipment damage from power outages is the electrical surges that occur when the power is restored.
Weather—wind, heat, ice and snow—is the most common cause and accounts for 80% of widespread power outages. Unfortunately, those circumstances are all pretty much out of your control. And your organization probably has little or no influence over your region’s power grid nor the amount of power allocated to it. So here are some precautions you can take in the event that you are faced with an outage:
- Develop a Business Continuity Plan.
It’s the single most important asset your company can have to outline how to continue to deliver products and services to your customers regardless of any internal operational problems that may occur because of outages.
- Conduct Emergency Response Training
Once you’ve created your plan, educate your employees and test their emergency response with drills.
- Install a UPS Device
One way to help prevent your company’s computers from being damaged or losing data stored in RAM is to use an uninterruptible power supply (UPS) device. UPS devices help equipment to stay on temporarily when a power outage occurs. These devices allow equipment time to shut down properly.
- Invest in a Backup Generator
Having an onsite backup generator is a simple way to prevent unplanned downtime from power outages, by reducing the need for dependency on the grid and providing power in the event of a brownout or blackout. And don’t forget to monitor the levels and quality of your emergency backup fuel!
- Perform Regular Backups
Be vigilant in backing up data to the cloud or to an external hard drive. Additionally, following the 3-2-1 Backup Rule will ensure that your data is saved in multiple locations so you always have a copy.
- Know what’s in the fine-print of your business interruption insurance policy.
This is a tricky one, since insurance claims—at least because of the Texas outages—can well exceed $19 billion. And since the most common source of insurance coverage for businesses facing losses is your property insurance policy, it’s imperative to understand what you are, and aren’t, covered for.
So, want to sleep easier? Plan well in advance of when you’ll need it. And contact the experts at TAG Solutions today for the customized help you need before it’s too late.