The Avoidable Cost of Downtime

Research Report
The Avoidable Cost
of Downtime
The impact of IT downtime on employee productivity
JANUARY 2011
Table of Contents
Executive Summary
Page 3
Further Information
Page 3
Survey Results
Page 4
Productivity
Page 4
Total number of man hours lost per year
Page 4
Average number of man hours lost per company, per year
Page 5
By company size
Page 6
By sector
Page 6
Research Results
Page 7
Impact of downtime on staff productivity
Page 7
Impact of recovery time on staff productivity
Page 8
Number of staff affected
Page 8
Downtime
Page 9
Frequency of IT outages (per year)
Page 10
Departments affected
Page 11
Conclusions
Page 12
Methodology
Page 13
Calculating lost productivity
Page 13
Resources to reduce the impact of IT Downtime
Page 14
Copyright ©2011 CA TECHNOLOGIES. All rights reserved. All trademarks, trade names, service marks and logos referenced herein belong to their respective
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even if CA TECHNOLOGIES is expressly advised in advance of the possibility of such damages.
PAGE 2
Executive Summary
CA Technologies has commissioned independent research* to explore European organisations’ experiences of
IT downtime and data recovery. Data analysis from the 1,808 organisations surveyed across 11 countries has
provided invaluable insights into how organisations are affected by IT downtime.
The survey data is being developed into a series of themed reports. The first phase, the financial impact of IT
downtime and data recovery, was launched in September 2010. This second phase is focusing on the productivity
loss associated with IT downtime.
The research shows that throughout Europe**, IT outages are frequent and lengthy. During these periods,
business critical systems are interrupted, leading to a drop in productivity of the staff affected and consequently
a drop in the amount of work carried out.
THE KEY FINDINGS OF THE RESEARCH ARE:
• European organisations above 50 employees are collectively losing more than 37 million man hours each year through IT
downtime and data recovery. On average, each company loses 552 man hours per year.
•European businesses collectively suffer from almost 1 million hours of IT downtime each year (956,373 hours). That’s an
average of 14 hours per company per year.
•During these periods, when business critical systems are interrupted, companies estimate that their staff can work at less
than 2/3 of their normal productivity (63%).
• Post IT downtime, (i.e. when IT systems are up and running), there’s an additional delay of 9 hours per year at each firm
during which time data is still being recovered. Across Europe, that’s another 628,565 hours when business operations
aren’t fully operational.
•In this post-outage period when data recovery is taking place, staff can still only work at 69% of their normal levels of
productivity.
Much of the impact highlighted in the research can be avoided through better data protection strategies. This will reduce
both the frequency and length of IT outages.
Furthermore, many companies endure longer than necessary interruptions to their IT systems, because their data protection
policies aren’t robust enough. Organisations often focus their efforts on backing up data securely while neglecting to
consider how quickly they can recover their data in the event of a failure. This ‘speed of recovery’ is a good starting point
for businesses planning or re-evaluating their disaster recovery needs.
* Coleman Parkes
** ‘Europe’ for the purposes of the study constitutes the countries surveyed: UK, France, Germany, Spain, Italy, Belgium, Netherlands, Norway, Finland, Sweden and Denmark.
FURTHER INFORMATION
For further information about the Avoidable Cost of Downtime please visit:
http://www.arcserve.com/gb/acd
PAGE 3
Survey Results
Total revenue loss for each
country is as follows:
PRODUCTIVITY
When IT systems fail an organisation’s staff need to find alternative ways to perform their tasks. However, as many business
operations are becoming wholly reliant on the use of IT systems and access to networks, any failure often means staff are
left being unable to perform their duties. Productivity drops, and revenue generation is negatively impacted.
The impact on productivity can be measured by looking at the number of staff affected by an IT outage, multiplying that by
the length and frequency of outages, and considering how much of the affected role is dependent on the failed systems.
Across Europe this produces some interesting and often alarming results.
TOTAL NUMBER OF MAN HOURS LOST PER YEAR
Europe
37,160,146
France
13,881,520
Spain
8,310,721
UK
5,495,623
Germany
4,770,937
Italy
4,189,956
Sweden
1,273,375
Finland
899,780
Denmark
851,398
Netherlands
699,660
Belgium
692,511
Norway
629,806
Total man hours lost per year
The total number of man hours lost per year through IT downtime and data recovery across all organisations in Europe was
calculated as 37,160,146.
Countries
France loses the most staff man hours due to IT outages. As phase 1 of the ACD study showed, it also loses the most
revenue-earning capability. This is most likely due to the design and deployment of large applications serving big
populations of users. A single outage affects many people and therefore has a more significant impact on productivity. This
“all eggs in one basket” approach to IT comes with risk, and to help reduce this risk, efficient data protection strategies need
to be employed that facilitate the fast recovery of data and systems.
“The total number of man hours lost per year through IT downtime and data recovery across
all organisations in Europe was calculated as 37,160,146.”
PAGE 4
AVERAGE NUMBER OF MAN HOURS LOST PER COMPANY, PER YEAR
Europe
552
France
1,082
Spain
905
Netherlands
584
Finland
535
Norway
534
UK
502
Denmark
489
Sweden
472
Germany
438
Belgium
300
Italy
223
Average number of man hours lost per company, per year
By country
Countries
“Organisations in France lost the highest number of man hours: 1,082,
and Italy the lowest: 223.”
Across Europe, the average number of man hours lost per company, per year, through avoidable IT downtime is 552.
Organisations in France lost the highest number of man hours: 1,082, and Italy the lowest: 223. One explanation for this may
be that Italy has a larger percentage of small and medium sized companies than the other countries (including France), and
therefore the number of staff affected is likely to be lower.
PAGE 5
Average number of man hours lost per company, per year
BY COMPANY SIZE
Company size
The number of man hours lost on average was lower for medium sized companies (390) than for small (588) or large (630)
organisations. This was due to respondents reporting that staff at medium sized companies were most productive during
periods of downtime and recovery. These companies also had short data recovery time when compared to other organisations.
Although small companies would be expected to lose fewer man hours due to the number of staff in the organisation, when
there was downtime they were found to be far less productive than larger organisations.
Average number of man hours lost per company, per year
BY SECTOR
Sector
The public sector lost significantly more man hours through IT downtime than any other sector (961 hours). The retail sector
lost the fewest as less staff are affected in each period of downtime. These figures illustrate the dependency each vertical
market has on IT systems. A significant percentage of staff in the retail sector can continue their primary tasks even during an
IT outage. This compares with the high impact on the public sector which has a larger proportion of staff being dependent on
IT systems. Another factor would be the governance each sector is exposed to. The finance sector has a large proportion of its
staff dependent on IT systems, however, due to pressure from industry and government legislation, they have deployed data
protection solutions that enhance the speed of recovery and therefore help maximise the availability of systems.
PAGE 6
Research Results
Percentage of staff productivity during downtime
IMPACT OF DOWNTIME ON STAFF PRODUCTIVITY
Countries
IT downtime was found to have a significant effect on staff productivity. Overall in Europe, when business-critical systems are
compromised, staff could only work at less than two thirds (63%) of their usual level.
Across the countries surveyed, organisations in Italy were most productive during periods of downtime (78%) and those in
Spain could work at less than half their normal level of productivity (45%).
Employees in small companies were significantly more affected than those in either medium or large companies by IT
downtime. Staff affected by outages in small companies could only work at 57% of their usual levels, compared with 67% in
medium companies and 66% in large companies.
There was little variation between vertical sectors in the effect of downtime on productivity. The public sector was the most
affected, with employees only working at 59% of their usual level. The finance sector worked at 66% productivity .
“IT downtime was found to have a significant effect on staff productivity. Overall in Europe,
when business-critical systems are compromised, staff could only work at less than two
thirds (63%) of their usual level.”
PAGE 7
Percentage of staff productivity during recovery time
IMPACT OF RECOVERY TIME ON STAFF PRODUCTIVITY
Countries
Whilst data is being recovered following periods of downtime, staff could still not work at their usual levels. Across Europe,
productivity levels only rose by 6%, from 63% during periods of downtime, to 69% when the systems were restored but data
was still being recovered.
Similarly to during downtime, Italian workers were the most productive whilst data was being recovered; they reported
working at 84% of their usual levels. Spanish workers were the least productive at 47% (only 2% more productive than during
the downtime).
During recovery time small businesses were again the least productive: 62% compared with 73% for both medium and large
businesses.
The public sector was again the least productive during recovery time, with employees working at 67% productivity. The
finance sector was the most productive: 72%.
NUMBER OF STAFF AFFECTED
Number of staff affected
On average, across
Europe, 68 members of
staff were affected during
each outage. The most
were affected in Spanish
organisations (91 staff
members) and the least in
organisations in the UK (45
staff members).
Countries
PAGE 8
DOWNTIME
Average downtime/recovery time (in hours) in the last outage
- Average downtime in the last outage
Recovery time
Downtime
Countries
Respondents were asked about the length of their most recent IT outage. Across Europe the average was 6.2 hours – the vast
majority of the working day. IT outages lasted the longest in the UK (9.8 hours) whilst companies in Belgium experienced the
shortest period of downtime (average 3.6 hours). It could be argued that the length of the outage does more direct damage to
revenue than the frequency. Short, frequent outages may have a bigger impact on the reputation of an organisation.
There was some variation in the amount of downtime experienced between sectors. Companies in the public sector underwent
the longest outages on average (7.5 hours) whereas the manufacturing sector had the shortest (4.9 hours).
There was little company size variation although small companies experienced slightly longer periods of IT outage than large
companies (6.7 hours compared with 5.7 hours). This reflects the roles that IT staff play within different sized organisations,
and their relative ability to plan for, and react to an IT outage. Large organisations have traditionally employed large IT teams,
with specialist roles focused on availability and data protection. Smaller organisations do not have this luxury, and the IT teams
are usually made up of IT generalists who need to manage all aspects of operations.
Respondents were also asked about the length of time it took between the systems and applications coming back up, and
all data being fully recovered and available. Across Europe the average was 4.1 hours; 2 hours less than the length of the
downtime itself. Data recovery time was longest in France (5.4 hours) and shortest in Denmark (2.0 hours).
Similar to the length of the outage, companies in the public sector took the longest to recover their data (4.7 hours). The retail
sector took the shortest amount of time (3.7 hours). Small companies took significantly longer to recover data after an outage
(5.2 hours) when compared with both medium sized companies (3.2 hours) and large companies (3.7 hours).
To minimise the impact of the post outage data recovery phase, organisations need to look at the design and the granularity of
the backup process. Critical business data should be isolated in the back from less important data, so that the recovery process
can focus on the critical systems first. The key is to bring back only what is needed!
“Companies in the public sector underwent the longest outages on average (7.5 hours)
whereas the manufacturing sector had the shortest (4.9 hours).”
PAGE 9
Average downtime/recovery time (in hours) in the last year
- Average downtime in the last year
Recovery time
Downtime
Countries
Downtime in the last outage and frequency of downtime were multiplied together to calculate the average amount of
downtime per company in the last year.
There were significant differences between the countries surveyed. The UK and France experienced the largest amounts
of downtime in the last year, an average of 27.3 hours for the UK and 23.3 hours for France. There was the least amount of
downtime in Belgium, an average of 7.7 hours.
There were only small differences between the vertical sectors; the public sector experiencing the most downtime with 17.7
hours. Small companies had more outage time than medium or large companies (16.0 hours compared to 13.7 and 12.9 hours).
When looking at the time taken to recover data following IT outages, an additional 9.3 hours per year is added to the downtime
total across Europe. France experienced the longest data recovery times (16.7 hours per year) and Denmark the shortest (3.7
hours per year).
Frequency of outages per year
Frequency of IT outages (per year)
Countries
Avoidable IT outages occurred an average of 2.3 times in the last year across Europe. There was very little difference by country,
although France and the UK experienced the most outages (3.1 and 2.8 respectively).
There was very little difference in the frequency of IT outages between either companies of different sizes or those from
different sectors.
PAGE 10
Percentage of companies affected
DEPARTMENTS AFFECTED
Department
Across Europe the operations department was most affected by IT downtime, with 60% of companies reporting that it was
affected by the most recent outage. The finance (44%) and sales (42%) departments were also highly affected.
Countries overall gave similar responses to this question. However, some countries particularly mentioned the marketing
department (Spain 44%, Netherlands 46%), HR/personnel (Spain 43%, Netherlands 43%, Denmark 42%) and distribution/
logistics (Spain 43%, Netherlands 43%).
PAGE 11
Conclusions
All organizations are dependent to varying degrees on IT systems. When these fail, it results in an alarming drop in employee
productivity.
The Avoidable Cost of Downtime research looked into the impact of IT downtime on employee productivity. Not only did it find
that downtime across Europe was frequent and lengthy, but that the effect of this downtime on employee productivity was
significant. Post-recession, staff productivity is a major headache for employers and employees alike. Many companies cut staff
during the economic downturn, leaving the remaining employees busier than ever.
Better data protection measures would have a great impact on improving employee productivity.
Tips and Advice on Avoiding Downtime and Maximising Staff Productivity
• Identify business critical systems and data. The first step in minimising the impact downtime has on the productivity of an
organization is to identify the applications and data that directly drive revenue, and the number of staff an outage would
affect. All too often organizations take a generic approach to data protection, applying the same policy and process to all
data. When a recovery is needed the availability of critical systems is hampered by the need to also recover non-critical data
in a generic process.
•Design the infrastructure to minimize the frequency of IT outages. For critical business applications invest in infrastructure
solutions that provide the highest levels of availability. This will include such technologies as clustered servers replicated
storage.
• Implement a data protection solution to deliver high speed recovery. Replication and disk-based backup technologies allow
faster recovery times. Make sure the solutions in place protect against logical corruption of data as well as physical failure.
Granularity of the backup will drive more granular recovery – meaning focus can be given to critical data first.
•Work with the right partner. No one solution is correct for every business and therefore it is important to work with
specialised data protection partners who can understand the specific needs of an organization and help deliver a complete
solution.
PAGE 12
Methodology
The fieldwork was conducted in July 2010 by Coleman Parkes Research.
1808 online interviews were carefully conducted across the following countries in Europe:
Country
No. of interviews
Country
No. of interviews
UK
200
Netherlands
201
France
201
Norway
100
Germany
202
Finland
102
Spain
200
Sweden
101
Italy
201
Denmark
100
Belgium
200
TOTAL SAMPLE
1808
Fieldwork was conducted in an equal split across the following vertical sectors:
•
•
•
•
Finance
Public sector
Retail
Manufacturing
Fieldwork was also carried out in an even split across companies of the following sizes:
• 50-499 employees (‘small’)
• 500-999 employees (‘medium’)
• 1000+ employees (‘large’).
Online interviews were conducted with CIO/IT directors/IT managers where appropriate across the companies. A small
proportion of finance directors were also interviewed to validate the accuracy of the company revenue figures obtained from
the IT executives. Where significant differences occurred the final IT data was amended accordingly.
Calculating lost productivity
The total number of man hours lost due to avoidable IT outages takes into account the total number of hours of downtime
when systems are offline, the total number of hours between system restoration and recovery of all data, the impact on staff
productivity during both of these periods, the number of staff affected and the overall number of avoidable IT outages a year.
Universal estimates for the three different company size categories were obtained from published sources. This data was used
to gross up the impact on productivity obtained from the survey. Sensitivity checks completed on relevant survey findings
confirmed that it was not necessary to apply company size weights to individual survey records.
*Research carried out by Coleman Parkes Research Ltd
**‘Europe’ for the purposes of the study constitutes the countries surveyed: UK, France, Germany, Spain, Italy, Belgium, Netherlands, Norway, Finland, Sweden and Denmark
PAGE 13
Resources to reduce the impact of IT Downtime
To find out more about how you can reduce IT Downtime
please visit:
http://www.arcserve.com/gb/acd
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About CA www.ca.com
CA Technologies is an IT management software and solutions company with expertise across all IT environments—from
mainframe and physical to virtual and cloud. CA Technologies manages and secures IT environments, enabling our customers to
deliver more flexible IT services.
Our solutions help our customers gain a level of deep insight into and exceptional control over complex, mixed IT environments.
It’s that level of insight and control that enables IT organizations to power business agility.
About Coleman Parkes www.coleman-parkes.co.uk
Coleman Parkes Research was set up over 8 years ago to deliver premium quality, action focused research, specialising in the
business-to-business space. The Company undertakes research for service and product suppliers to all parts of the business
community including Finance, Retail, Government, Services and Manufacturing. The last of these is a specialist area and with
both Directors of the Company having devoted most of their working lives to this sector, the Company is able to offer informed,
incisive manufacturing based research that is without peer.
PAGE 14