North American Businesses Lose $26.5 Billion Annually From Avoidable Downtime, According to New CA Technologies Study
Unavailability of IT Systems Reduces Ability to Generate Revenue by 29 Percent
ISLANDIA, N.Y., Dec. 9, 2010 /PRNewswire/ -- CA Technologies (Nasdaq: CA) today announced the results of an independent study revealing that North American businesses are collectively losing $26.5 billion in revenue each year as a result of slow recovery from IT system downtime. In fact, such downtime reduces the average company's ability to generate revenue by 29 percent.
The study quantifies the financial losses that occur when businesses cannot quickly recover from service outages. Based on results from 200 companies across North America, it reveals that the average respondent suffers 10 hours of IT downtime a year—which translates to more than 1.6 million* hours across North America.
During these periods of downtime, respondents estimate that their ability to generate revenue is reduced by nearly a third (29 percent). Even after service is restored to critical systems, businesses experience an additional 7.5 hours of compromised operation because of the time it takes to recover lost data. Across North America as a whole, that amounts to another 1.25 million** total hours of impaired business performance. Respondents estimate that during this post-outage impairment, their ability to generate revenue is still reduced by an average of 17 percent.
The study found that much of this considerable cost to businesses and the economy can be avoided through better data protection strategies that enable more rapid recovery of critical services.
"IT organizations can't always prevent service outages, but they can take the right steps to improve the speed of recovery when outages occur," said Mike Crest, general manager, Data Management, CA Technologies. "This will become even more important as businesses become increasingly dependent on both traditional and cloud IT services for the ongoing generation of revenue."
The study also highlights significant differences across market segments, such as financial services (where companies lost an average of $224,297 per year) and the public sector (with agencies losing only $99,094 per year). This was due to the amount of revenue generated by those respective segments—since the public sector experienced the highest amount of downtime (16.6 hours per year compared to the overall average of 10.0 hours).
Other key findings included:
- 71 percent of companies surveyed said that the IT services affected by outages were mission-critical.
- The departments most likely to experience downtime were operations (62 percent), finance (48 percent) and procurement (39 percent).
- Small companies suffer the most during periods of downtime, showing the least ability to generate revenue (39 percent compared to 19 percent for medium-sized companies and 28 percent for large companies). A similar pattern emerged during recovery time (23 percent for small companies, 11 percent for medium and 18 percent for large).
A parallel study was conducted across 11 European countries in July 2010. A comparison of the two studies shows that on average North American businesses lose less revenue than their European counterparts ($159,331 vs. $349,014 per company). The primary reason for this is that, although the two regions had a similar number of outages per year (2.2 in North America, 2.3 in Europe), the duration of IT outages in Europe was longer. The total downtime per outage (including time taken to recover the data) in Europe was 10.3 hours—compared to 7.9 hours in North America.
For further information and materials from the survey, please visit http://arcserve.com/us/lpg/cost-of-downtime.aspx. For additional information about the CA ARCserve Family of Products, please visit www.ARCserve.com.
* 1,661,321 hours
** 1,255,220 hours
About the study
The study was conducted by an independent research firm, Coleman Parkes. All interviews were undertaken during November 2010. The study was based on a total of 200 online interviews amongst CIOs/IT Directors/IT Managers and a small proportion of COOs/Operations Directors across an even split of small (50-499 employees), medium (500-999 employees) and large (1000+ employees) companies.
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About CA Technologies
CA Technologies (Nasdaq: CA) is an IT management software and solutions company with expertise across all IT environments – from mainframe and distributed, to virtual and cloud. CA Technologies manages and secures IT environments and enables customers to deliver more flexible IT services. CA Technologies innovative products and services provide the insight and control essential for IT organisations to power business agility. The majority of the Global Fortune 500 relies on CA Technologies to manage evolving IT ecosystems. For additional information, visit CA Technologies at www.ca.com.
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