The True Cost of a Poorly Maintained Network

April 27, 2017 | Logical Talk, Helpful Advice

As a direct result of technological failures due to a poorly maintained network, businesses of all sizes encounter these losses every day. No one is exempt from system crashes, network outages and other computer problems.

In an effort to quantify these losses, many businesses turn to industry statistics, but statistics can only give you an average – and no business is average.

Still, no one can deny the fact that such an interruption can cost a considerable amount of money. It doesn’t matter whether the outage is caused by a server crash, hardware failure or some other outside force. If your business has ever come to a screeching halt because of failed technology, you understand this fact all too well.

Need further convincing? Take a look at these statistics:

93% of companies that lost their data center to a disaster for at least 10 days filed for bankruptcy within one year. 50% of businesses that found themselves without data management for this same time period filed for bankruptcy immediately. (Source: National Archives & Records Administration in Washington.)

20% of small to medium-sized businesses will suffer a major disaster that causes critical data loss every 5 years. (Source: Richmond House Group)

In 2010, 40% of small to medium-sized businesses that manage their own network and use Internet for more than email will have their network accessed by a hacker, and more than 50% won’t even know they were attacked. (Source: Gartner Group)

The average company spends between $100,000 and $1,000,000 in total ramifications per year for IT related disasters (both hard and soft costs). (Source: 7th Annual ICSA Lab’s Virus Prevalence Survey, March 2009.)

Of the companies participating in the Contingency Planning & Management Cost of Downtime Survey: 46% said each hour of downtime would cost their companies up to $50,000, 28% said each hour would cost between $51,000 and $250,000, 18% said each hour would cost between $251.000 and $1 million, 8% said it would cost their companies more than $1million per hour. (Source: Cost of Downtime Survey Results, 2010.)

As you can see, losses in productivity can be absolutely devastating. They can ruin an otherwise healthy business. But these aren’t even the only expenses to consider when systems fail. You also have more tangible costs, like labour. Most major network repairs will take a minimum of four to eight hours to complete. Plus, most technicians cannot get onsite to resolve the problem for 24 to 48 hours. That means your network could be down for one to two days.

The average computer consultant charges over $125 per hour, so the average hard cost of one repair will be upwards of $600 to $1,000 including drive time – and that’s just for labour. If your systems fail three times in a year, you’re looking at labour costs from $1,800 to $3,000. If you need any hardware or software, expect to pay more. And if you want know the true cost of this downtime, factor in the labour and lost productivity costs.

While the costs of upgrading and maintaining your network may seem expensive, preventing a devastating loss caused by technological failures is virtually priceless.