While technology has allowed businesses to cut costs in many areas, proper storage of digital information comes at a price. Yet most companies are paying more than they need for data solutions and getting less protection than they need to keep their data—and their business—protected against disaster.

How lack of business continuity and disaster recovery planning can lead to financial disaster

Business continuity and disaster planning is an absolutely essential part of any business operation, yet many give implementation a low priority. In the digital age, information technology is a critical function of all competitive businesses. From technology-driven companies to service companies and e-commerce businesses, information is the backbone that keeps today’s businesses operating competitively and efficiently.

The terms “business continuity and disaster recovery planning” imply the need for these critical business functions. Business owners realize the importance of these terms, but it’s when they understand what’s inside these processes that they realize that business continuity and disaster recovery planning aren’t just “important,” they are essential.

Financial impact of business continuity planning

As a result of government regulations, companies must maintain a business continuity posture, whether they realize it or not. Critical applications must be available continuously or be able to recover quickly on demand. Lack of knowledge or understanding of the laws is not a defense. Non-compliance can lead to lawsuits, infractions and fines that can undermine a business.

Achieving business continuity is not a ‘set it and forget it’ task. The process usually starts with a BIA (business impact analysis), which, among other things, prioritizes different types of data. The BIA dictates what information will be stored, where, and how often it will be backed up.

If a company is to design business continuity structures on its own, it will need significant knowledge and resources to maintain it. However, for companies that aren’t technology-focused or choose not to add in-house IT staff costs, there are practical and affordable outsourcing solutions, more on that later.

Financial Impact of Disaster Recovery Planning

According to a study by the Garner Group, forty percent of businesses that experience a catastrophic data event or significant downtime will never recover. Two out of five businesses that face these situations close their doors permanently. This shocking statistic sheds light on how essential data management is for a business.

What’s even more surprising is that a relatively small amount of effort invested in a BIA along with business continuity and disaster recovery planning could have prevented the problem in the first place. The BIA would have discovered the impact of the process failure on the business and served as a discovery process to implement a plan designed to avoid the risk.

Cost reduction through more efficient energy use

Once a company has addressed business continuity and disaster recovery planning by following the recommendations outlined in a BIA, it has taken the critical step to avoid potential financial devastation. The next step is to reduce the very real ongoing costs associated with data maintenance.

The cost of energy used to maintain data storage systems is quite significant. IT infrastructure not only consumes power, but a significant amount of power is used to maintain a safe climate for systems.

The best way to reduce the cost of maintaining data systems is to share the costs with others. By storing the systems in a data center colocation, you offset the cost of climate control by splitting that cost with others. Because the data center colocation manages climate control to protect your machines and the machines of others, you share a lot of costs that would otherwise be entirely your responsibility if the machines were stored in-house. Not only are energy costs shared, but also the costs associated with human capital – the experts who maintain the data center colocation day in and day out.

Reduction of personnel costs while raising the level of experience

Staffing an IT department is expensive. Employers must not only hire a variety of people, each with various skill sets, but they will also need someone to manage the team. To remain competitive, employers are expected to foot the bill for continuing education and training. And let’s not forget system updates. However, by using managed IT services, companies reduce these capital expenses and pay per subscription for only the percentage they use.

Managed service providers handle a variety of tasks including virtual server hosting, backup, IT infrastructure management, and more. Some vendors will also offer BIA services and the critical business continuity and disaster planning needed to keep data safe and compliant.

The data management landscape has changed dramatically in recent years, not only in the way data is stored, but also in the importance of proper security. Data storage itself has become more critical than in the days of yore, when a simple tape drive was all a business needed. However, cost-sharing options by leveraging outsourced providers have made it easier than ever to obtain high-end data management solutions. Today’s companies don’t have to be experts in BIA or business continuity planning and disaster recovery, they just need to partner with a vendor that is.